Influence of culture on business performance: Identifying the impact of culture on business performance

🌐 Understanding Organisational Culture

Organisational culture is a system of shared assumptions, values, and beliefs, which governs how people behave in organisations. These shared values have a strong influence on the people in the organisation and dictate how they dress, act, and perform their jobs.

📚 Different Theories of Organisational Culture

There are several theories that attempt to explain what organisational culture is and how it influences the workplace. Some of these include:

• Hofstede's Cultural Dimensions Theory: This theory suggests that people's values in the workplace are influenced by culture. Hofstede identified six dimensions of culture that can be used to differentiate cultures.

• Schein's Three Levels of Culture: This theory suggests that culture operates at three levels: artifacts (visible organizational structures and processes), espoused values (strategies, goals, philosophies), and basic underlying assumptions (unconscious, taken-for-granted beliefs).

• Deal and Kennedy's Cultural Model: This model suggests that the business environment, values, heroes, rites and rituals, and cultural network together form the corporate culture.

📊 Different Types of Organisational Cultures

Organisational cultures can be classified into four main types:

• Power Culture: Power is concentrated among a few with little bureaucracy. Decision-making can be swift.

• Role Culture: Power is determined by a person's role and position in the organisational hierarchy. It is a stable culture with clearly defined responsibilities.

• Task Culture: Power is derived from a team with expertise and skills. It is a flexible and adaptable culture.

• Person Culture: Power is distributed evenly as individuals are seen as unique. It is a culture that values individuality.

🏢 Manifestation of Culture within an Organisation

Culture is manifested within an organisation through various elements such as:

• Symbols: These are the visible representations of the culture including logos, how plush the offices are, and the formal or informal dress codes.

• Language: The jargon, slang or language used within the organisation.

• Rituals and Routines: The daily routines and rituals that staff engage in.

• Stories and Myths: These are the tales told about the organisation and its history.

• Control Systems: The ways that the organisation is controlled.

• Organisational Structures: The hierarchical setup or the flow of power within the organisation.

• Power Structures: Who makes the decisions, how widely spread is power, and on what is power based.

📈 Influence of Culture on Business Performance

Organisational culture significantly impacts business performance. A positive culture can lead to increased productivity, employee satisfaction, and bottom-line performance. On the other hand, a negative culture can lead to low morale, poor performance, and high turnover.

🎯 Cultural Values in Operation in an Organisation

Cultural values are the core principles and ideals upon which an entire community exists. This applies in the business world as well. The cultural values in operation in an organisation can be identified through the behaviours, conversations, and physical environment including the office setup and dress code.

🎩 Influence of Cultural Values on Leadership Styles and Business Structures

Cultural values play a significant role in determining leadership styles and business structures. For instance, a culture that values teamwork and collaboration may have a participative leadership style and a flat organisational structure. On the other hand, a culture that values individual achievement may have an autocratic leadership style and a hierarchical structure.

📊 Influence of Cultural Values on Productivity

Cultural values also impact productivity. A culture that values hard work and high standards will likely have high productivity. Conversely, a culture that values bureaucracy and complacency may struggle with low productivity.

🎯 Impact of Organisational Culture

Organisational culture has a profound impact on the business. It affects every aspect of the business from decision-making to employee engagement and productivity.

🌍 Effect of Organisational Culture on Business

The effect of organisational culture on business can be seen in various ways. For instance, a positive and strong culture can attract and retain talented employees, promote a high level of service and customer satisfaction, and drive robust financial performance.

🔄 Management Style in Different Cultures

The management style would vary in a power, role, task, and person culture. In a power culture, the management style is autocratic, in a role culture, it is bureaucratic, in a task culture, it is democratic, and in a person culture, it is laissez-faire.

🏆 Preferred Organisational Culture

The type of organisational culture one would prefer to work in depends on their personal values, work style, and career goals. Some may prefer a power culture where they can take charge, while others may prefer a role culture where they have a clear set of responsibilities.

🎁 Benefits to Organisations

A positive organisational culture brings numerous benefits to organisations. It can lead to increased productivity, employee satisfaction, improved reputation, and ultimately, better financial performance.