Tom Peters and other organization development luminaries consider culture a key element in sustainability and success. There are many studies and books seeking to understand and provide models for organizational culture. Most are based on the analysis of successful organizations, like Apple and Google, extracting characteristics that might have contributed to their success. In their book In Search of Excellence, Peters and Robert Waterman define eight characteristics of successful organizations and their cultures. The point that these authors make (and miss at the same time) is that there is a “right” way for an organization to operate and, by implication, all others are incorrect.
Is there an approach to understanding organizational culture that looks at its underpinnings without judging what culture is better than another? Between 1985 and 1987, the Institute of Research and Intercultural Cooperation (or IRIC) conducted a study with 20 organizational units across two countries that resulted in the definition of six dimensions of organizational culture. These are not characteristics that determine how lasting or successful an organization is or will be. Rather, they are the components that define the culture of an organization with the sole purpose of understanding it and determining how it responds to its environment.
Before we explore the six dimensions or organizational culture, let’s consider the broader subject of culture. Based on most definitions, culture is the “shared values and beliefs that provide common meaning to a social group.” According to Geert Hofstede, renowned sociologist, the deepest level of culture is gender, followed by nationality, social class, occupation, industry and organization. During the first 10 years of our lives, we develop a sense of gender and our national culture, according to Hofstede. It is in the family unit (or its surrogate) where we assimilate most of our individual values. During this period, we form our basic worldview and our underlying assumptions for how life works.
Our social class or regional culture matures during our teenage years as we expand our relational circle. Additional values and beliefs are factored in during this time too.
By our late teens and early 20s, we typically select an occupation. This choice brings education and practices into our personal knowledgebase. It also brings additional values and beliefs associated with the occupation. A pediatrician, for example, has a set of values and a knowledge base that is quite different than that of a math teacher. As we venture into the workplace, we encounter industry cultures in our chosen field of study, including organizational workplace cultures at companies, like IBM. These cultures are less about values and more about practices. As we join organizations, we retain our values but we embrace practices that have unique sets of underlying assumptions and “perceived” values. Organizational leaders drive the practices that are accepted and fostered as well as the ones that are frowned upon. When an organization makes its number one value customer satisfaction, this means its practices concerning customer satisfaction are the most valuable.
The six dimensions of organizational culture outlined by the IRIC study are:
- Process-oriented versus results-oriented;
- Employee-oriented versus job-oriented;
- Parochial versus professional;
- Open versus closed system;
- Loose versus tight control; and
- Normative versus pragmatic.
Each of these dimensions manifest along a continuum. For instance, there is no organization that would be exclusively process-oriented in all of its internal units. Some units will be very process-oriented while others operate in a results-oriented manner. These dimensional differences constitute organizational subcultures. For instance, a manufacturing unit would most likely exhibit a process orientation while sales would most likely exhibit a results orientation.
Process-oriented cultures are concerned with the means of getting work done, are typically risk adverse, and their fundamental product or service comes from repetitive tasks. Manufacturers of high volume goods have process-oriented cultures. By contrast, results-oriented cultures work on a variety of tasks, are comfortable in taking risks, and focus on reaching targeted goals. A marketing-driven company of complex products would be a good example of a results-oriented culture. Process-oriented companies are typically associated with conventional technologies while results-oriented organizations are more concerned with cutting-edge, high tech. High educational levels are typically associated with results-orientation.
Employee-oriented cultures exhibit great care for their employees, including their wellbeing. In these organizations, decisions are typically made by groups. Job-oriented cultures, by contrast, care more about the tasks being completed than the wellbeing of the people. In these cultures, decisions tend to be made by individuals. A key determinant of the orientation for this dimension is how the leader of the organization is measured. Financially-measured leaders tend to foster job-oriented cultures while performance measurements allow employees greater freedom and tend to be more caring.
A parochial culture is paternalist and its members assume that their personal lives are intermingled with their work life. Individuals in this culture assume that the future will be addressed by the organization. A strong personal identity driven by belonging to the organization is part of a parochial culture. Professional cultures, on the other hand, see personal and work lives as separate. People in these cultures assume that their contribution directly affects the future of the organization. In a professional culture, an employee’s identity comes from the work that he or she performs and not the organization. The level of education and specialization in an organization is a key determinant of parochial versus professional cultural continuum.
Open-system cultures welcome newcomers who can adapt in a matter of days. The opposite occurs in closed-system cultures where onboarding can take a long time and be measured in months and years. In closed systems, the leaders of the cultures act as the approvers of who can progress into the inner circle. “Good old boy” cultures are a great example closed systems. The IRIC study concluded that organizations with a balanced number of women and a representative number of women managers tend to be more open.
Loose control cultures have little regard for cost controls and punctuality. These cultures also exhibit a larger than usual level of internal sarcasm about the organization. The opposite is true for the tightly control cultures. In this dimension, the size of the organization matters. Larger organizations tend to be managed more tightly. Also, the growth of the organization can affect the level of controls. A growing organization, like a startup, could be a lot looser than a compressing one, such as an organization experiencing layoffs.
The final dimension—normative versus pragmatic—is driven by customer-orientation. Public sector organizations, such as the FDA, have normative cultures, which are procedure- and standard-focused. Unlike the normative culture, an organization with a pragmatic culture would emphasize ethics and a high level of quality, always doing what is right for the customer.
The IRIC study provides a useful cultural lens for organizations. The six dimensions presented here apply to any organization and its units. The study did not investigate success and sustainability as a function of culture; however, Hofstede, who lead the IRIC study, concluded that the alignment of the six dimensions of organizational culture with the needs of the environment where the organization operates has considerable impact on how successful an organization will be.