Corporate Culture Overview

Study Notes

Corporate Culture

Definition: Corporate culture is "the way we do things round here" as described by Charles Handy. It encompasses the values, beliefs, and norms of a company.
Strong vs. Weak Culture:
- Strong Culture: Possesses clear communication, a focus on core values, and a recruitment process to find individuals aligned with the business culture. Often built upon history, tradition, and the influence of founders.
- Weak Culture: Often leads to business failure, demonstrates a demotivated workforce, inconsistent customer service, poor management, bureaucracy, and lacks flexibility to respond to dynamic markets.
Company Culture Classification (Handy):
- Power Culture: Centralized power structure with a strong leader at the core of the business, making most decisions.
- Role Culture: Hierarchical structure with clear roles and responsibilities. Decision-making follows established lines of authority.
- Task Culture: Focuses on completing tasks efficiently and effectively. Teams are formed to address specific projects.
- Person Culture: Emphasizes individual expertise and knowledge. Experts work together on a client-by-client basis.
How Culture Is Formed:
- Influenced by key factors:
  - The founders' or owners' ethos and influence
  - The nature and products of the business
  - The degree of change in the products offered
  - The business environment at its inception
  - Recruitment and key staff appointment practices
  - Working hours
  - Attitude towards customer service
Difficulties in Changing Established Culture:
- Strong cultures are hard to change due to the interconnected nature of its components (goals, roles, processes, values, communication practices, attitudes, and assumptions).