Corporate Culture in Business Management


C. Loganathan
MBA Department
SSM College of Engineering
Komarapalayam-638 183, Namakkal District


The culture of an organization is often expressed as "the way we do things around here" and consists of largely unspoken values, norms, and behaviors that become the natural way of doing things. An organization's culture may be more apparent to an external observer than an internal practitioner.

The corporate culture energy field determines a company's dress code, work environment, work hours, rules for getting ahead and getting promoted, how the business world is viewed, what is valued, who is valued, and much more.

Every company or organisation has numerous corporate cultures. For example, the marketing department and the engineering department may have very different corporate cultures which are both influenced by the overall organizational corporate culture. Many times these two sub-cultures clash.

Culture shows up in both visible and invisible ways. Some expressions of corporate culture are easy to observe. You can see the dress code, work environment, perks, and titles in a company. This is the surface layer of culture. These are only some of the visible manifestations of a culture.

Business leaders often assume that their company's vision, values, and strategic priorities are synonymous with their company's culture. Unfortunately, too often, the vision, values, and strategic priorities may only be words hanging on a plaque on the wall.

Corporate culture is actually the container for the vision, mission and values. It is not synonymous with them. In a thriving profitable company, employees will embody the values, vision, and strategic priorities of their company.

What creates this embodiment (or lack of embodiment) is the corporate culture energy field that permeates the employees' psyches, bodies, conversations, and actions. Companies need a good definition of corporate culture before they can begin to understand how to change the corporate culture.


Many books have been written in recent years about culture in organizations, usually referred to as "Corporate Culture." The dictionary defines culture as "the act of developing intellectual and moral faculties, especially through education." This writing will use a slightly different definition of culture: "the moral, social, and behavioral norms of an organization based on the beliefs, attitudes, and priorities of its members

"A common perception held by the organaisation's members, a system of shared meaning"

Corporate culture is not something that can be defined. It's intangible: a state of mind, a feeling, a collective consciousness that is infused in a business and its employees. Ask 20 business owners to define their corporate culture, and you will get 20 different responses. Nevertheless, defining a company's corporate culture is not as important as the way a company works to establish it. Many businesses lose sight of the importance of a coherent and positive corporate culture, or they have limited knowledge about how to develop it. Many of these companies will concentrate on business disciplines that are directly connected to their profit margins and neglect the emotional health of their employees when, in fact, the two are closely related.

Every organization has its own unique culture or value set. Most organizations don't consciously try to create a certain culture. The culture of the organization is typically created unconsciously, based on the values of the top management or the founders of an organization.

"Another important thing is to spend a lot of time with your people and to communicate with them in a variety of ways. And a large part of it is demeanor. Sometimes we tend to lose sight of the fact that demeanor - the way you appear and the way you act - is a form of communication. We want our people to feel fulfilled and to be happy, and we want our management to radiate the demeanor that we are proud of our people, we are interested in them as individuals and we are interested in them outside the work force, including the good and bad things that happen to them as individuals."

There's some debate over whether companies should design their personnel policies and reward systems around cultural values. Currently companies tend not to, because of the concern about stereotyping certain cultures.

A popular trend is for companies to "reengineer" themselves, which involves an attempt to change their culture, usually to a team orientation. Following are necessary for a company to change to a "team culture:"

  • Common and consistent goals
  • Organizational commitment
  • Role clarity among team members
  • Team leadership
  • Mutual accountability with the team
  • Complementary knowledge and skills
  • Reinforcement of required behavioral competencies
  • Power (real and perceived)
  • Shared rewards

Managing a Multi-cultural Team

"Culture is central to what we see, how we make sense of what we see, and how we express ourselves." And when you are managing a multicultural team, you are working with people who are different in what they see, how they make sense of what they see and how they express. This is indeed a challenging situation. But don't take your step backward, because the future is with global business.

You might be working with a team which consists of Americans, Indians, Chinese and Europeans. What diversity! Now let us see what challenges you will have to face and how to handle them efficiently.

1. What are the challenges?

  • Cultural differences and mutual understanding
  • Geographical distance causing absence of face to face contact
  • Miscommunications due to language and cultural barriers
  • Difficulties in meeting motivational needs
  • Differences in work style, speed of work and quality standards
  • Different perceptions on ethics
  • Time zone differences and work co-ordination

2. How to handle cultural differences?

The first and the most important task in your hand is to prepare your team for a culturally different work experience. Prepare their mindset to accept differences and be open to each other.

  • Facilitate open discussions among the team on their cultural differences to help in creating a conducive environment to understand each other
  • Provide orientation and mentoring about how to communicate to a culturally different counterpart
  • Develop a concept of cultural synergy
  • Research and learn about other cultures
  • Respect and appreciate each other's differences and work together
  • Draw out a common approach towards project completion
  • Encourage a flexible environment
  • Assign project managers who can efficiently handle multi-cultural teams

3. How to handle communication challenges?

Communication is a complicated phenomenon on it own. A North American and a South American speaks different. There are researchers who study communication differences which arise from one street to another. So a common ground is what we are all looking for. A perfect common ground is impossible but you can train yourself and your team to attain acceptable international standards of communication. Moreover, country specific communication training will help bridge those gaps.

4. How to co-ordinate time zone differences?

Time zone difference is a major factor which will influence your team. The problem that you will face here is that of proper work co-ordination. But this is to some extent reduced by night time shifts. For example, you can have a team in India which works night shifts while your team works day shifts. This makes sure that work is carried out simultaneously.

Another option is to organize your work in such a manner that work assigned to one team in a zone will be finished by the time other team gets to work. This can add to your benefit as your work is getting round the clock.

5. What benefits can you leverage from a culturally different team?  

Once you can reach a common ground of understanding for each other, what results is a highly potential multi-cultural team which can serve you with:

  • Variety of ideas
  • A global perspective of business
  • Efficient time management
  • Different problem solving approaches

Creating a Positive Corporate Culture

Establishing a positive corporate culture is likely one of the most misunderstood business principles. Whether or not your business has attempted to create a 'culture', every company has one. Whether positive or negative, corporate culture is something that requires systematic effort over time.

Key Ingredients to Creating a Positive Corporate Culture

Consider the following tips in the areas of recruitment, orientation, training, communication and recognition when working towards establishing or maintaining a positive corporate culture:

1. Recruitment

Creating a positive culture within an organization begins with an effective recruitment program. The manner in which a company recruits and chooses its employees is dependant on how it develops and maintains its company culture. Properly screening and evaluating candidates is a must. With the high cost of turnover, it is especially important to be sure you make the correct positioning choice for the employee. Use skilled interviewers to assess the candidate's skills and commitment, his ability to relate to others, to listen, to assume and/or delegate responsibility, and to be enthusiastic.

2. Orientation

After a company has chosen the correct candidate for a position, orientation of that individual becomes one of the most critical factors for a company. The key to a successful orientation is to be sure that the new employee has a "great" first day. In order for a new employee to feel comfortable and fit in with their new environment, it is imperative that they be introduced to key players and exposed to existing policies and procedures. In addition, allowing for periodic feedback during the early stage of employment is also essential.

3. Training

Significant time, sufficient energy and support should be given to everyone who enters a company. Any offered or required training programs should be motivational, as well as informative, whether in a classroom setting or on the job. Offering the option for additional training also illustrates to employees that the company cares about their professional growth.

4. Communication

Clear and consistent communication is one of the most important ingredients to a positive corporate culture. In addition, the most effective communication requires feedback and follow-up. Everyone should be encouraged to speak up, ask questions and seek clarification of issues to avoid misunderstandings. In a positive culture, everyone enjoys a sense of belonging and involvement.

The ability to delegate responsibility is yet another important form of communication and a great way to inform and involve other employees in a specific operation. Having an "open door" policy to review goals, problems and opportunities is a great way for a manager to communicate to their employees, developing an open and trusting relationship with them.

5. Recognition and Reward

Although this subject has been covered in previous articles, recognizing both positive and negative behavior, and achievement of various goals, are critical factors in establishing a positive corporate culture. Each employee should have a set of goals and objectives. In a positive corporate culture, praise, recognition and encouragement should be constant. Incentive programs, whether cash bonuses, trips or other rewards are always a good idea when recognizing an employee.

Driving Corporate Culture for Business Success

A detailed blueprint for transforming corporate culture, this Report reveals the critical success factors in creating a strategically focused corporate culture.

You will learn how to:

  • Align culture change with strategic objectives.
  • Create a winning culture, not a strong culture.
  • Get 100 per cent commitment from the CEO and senior management team.
  • Use value statements, visions and missions as culture change drivers.
  • Get culture change buy-in from the whole organization.
  • Ensure HR systems support the new culture.
  • Communicate, communicate, communicate…

Some things to consider when defining the type of culture you want to create would include:

  • How do you and how much do you empower your employees to make decisions?
  • Do you delegate and what do you delegate?
  • How open you are to accepting input for others (employees, clients, suppliers) and how do you act on that information?
  • What types of employees do you want to hire (the best and the brightest or people who are expected to leave their heads at home?)
  • What are the values you want to embrace and promote to your customers, employees and suppliers (fairness, honesty or just meet the numbers?)
  • What kinds of behaviors do you want to measure and reinforce (behaviors that create long term relationships or just make the sale and move to the next opportunity?)

Many companies do not give much attention to their corporate culture. It just evolves through the people they hire. It is usually driven by the attitude and behaviors or the company president and is passed along unconsciously.

When you take the time to define and create your corporate culture you are telling others what kinds of people will flourish in your company; it tells tell the market the companies you want to business with, it defines the behaviors that will be accepted in your organization.

Creating a specific company culture is just as important to the success of an organization as a sound business plan. In fact, the definition of how you want your corporate culture to perform should be a part of your business plan.

Of all the companies I studied, the most successful in the long term, were very clear in what their corporate culture would look like and they took action to see that is was implemented.


If your company's culture is not quite what you'd dreamed it would be, you have the ability to change it. Companies should make developing a positive corporate culture one of the top five goals for the business. Building the culture on clear vision, attainable goals, a genuine concern for the employees' professional growth, and an appreciation of their contributions to the success of the business will create a positive atmosphere and working environment. A corporate culture often happens by default instead of design. But companies that purposefully set up their culture are far more successful than companies that have a culture that exists by default.






5. Organisational behaviour, stephen p. Robbins,9th edition,Prentice hall of India, New delhi

6. Organisational culture,Nasreen Taher,2005 edition ICFAI University Press, Hyderabad.

C. Loganathan
MBA Department
SSM College of Engineering
Komarapalayam-638 183, Namakkal District

Source: E-mail October 12, 2007


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