A company’s culture is defined as “shared and trusted values that enable employees to understand their roles and company norms” (1). Additionally, they share habits, codes of conduct, traditions, experiences, and objectives within the company. Studying the culture of a company allows knowing its nature, characteristics, and personality. Without them, it would not be the company it is.
Corporate culture is something that the company defines in advance and the employees reflect. This essence is important for customers, talent, and future employees. In addition, a company’s culture facilitates decision-making, and promotes cooperation, motivation, and commitment to the company’s goals. Here’s everything you need to know about company culture types, and how to assess your company’s culture.
Summary
- Corporate culture is defined as shared values, habits, customs, behavior, norms, traditions and goals within a company. These can be transmitted from one generation to the next, depending on the company.
- A company’s culture is relevant because it defines the nature and personality of a company. This essence differentiates companies within their community or market. It also helps to understand how the company will act in different circumstances.
- Today, there are several types of company culture. We share with you everything you need to know about its 8 types.
8 types of company culture
Stephen Robbins, an expert in company culture, assures that there are only two types of company culture. The strong one, with strong and respected values. The other, weak, which is not well-defined and needs to improve various aspects of the organization. On the other hand, Cameron and Quinn’s model of corporate cultures explains that there are several types, and they all have different purposes. Here are the 8 types of the corporate culture:
1. Clan culture
The clan or collaborative culture is characterized by family values and encourages teamwork. You have probably heard people refer to their coworkers as family. This indicates that they are working in a clan culture. This culture seeks to build its culture in the same way that a family nucleus does.
Advantages
The clan culture is a happy working team and they genuinely enjoy working together. Communication within the team is very good.
Disadvantages
This culture can make the work environment feel very relaxed. As a result, it can reduce productivity, and lead to too much collaboration, or unnecessary chatter.
Example of this type of culture
The shoe and apparel brand Zappos prides itself on having a positive culture. So much so, that the founder wrote a book about their positive culture. Their values of positive team building and family spirit fit perfectly into this type of company culture.
2. Adhocratic culture
The adhocratic culture is characterized by a focus on innovation and not being afraid to take risks. Workers with this type of culture challenge the status quo and constantly look for ways to improve, innovate, and develop new services and products.
Advantages
This culture motivates employees to constantly innovate. This makes the company scale and excel in its market.
Disadvantages
Constant innovation makes it difficult for employees to focus on one thing at a time. Also, this culture can be intimidating for new employees, as it is too fast-paced.
Example of this type of culture
Google is well known for having precisely this type of culture. The company excels at constantly innovating to improve its products and launch new ones. Other companies that fit this type of culture are Facebook and Apple.
3. Market-oriented culture
Market-oriented culture is characterized by a focus on results. In this type of culture, people want to win and achieve what they set out to do. So employees focus on their goals and leaders take success metrics very seriously.
Advantages
Employees are proactive and motivated to achieve their goals. This culture improves company performance because all employees are committed to success.
Disadvantages
Constantly encouraging competition can lead to a toxic environment. Also, it can cause employees stress and burnout from so much pressure.
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Example of this type of culture
Amazon is an example of a market-driven culture. One of its leadership principles is to “deliver results.” In fact, some employees have been outspoken about the fact that the company expects them to deliver results and do their best, regardless of the personal cost. The company’s success proves it.
4. Hierarchical culture
Hierarchical culture, also known as control culture, is a work environment that is more structured and process-oriented. Activities and decisions in this culture are dictated by existing procedures. Everything and everyone has a clear role and purpose, in order to keep everything organized.
Example of this type of culture
This type of culture is commonly found in high-risk industries. For example, financial institutions such as Wells Fargo and Goldman Sachs. Health care, such as Cross Blue Shield. Finally, the oil and gas industry, such as Chevron and Shell.
5. Customer-centric culture
A customer-centric culture is characterized by prioritizing the customer experience. Employees have the tools and autonomy to put the customer first at all times. Its purpose is to make the customer experience positive and as a result, create loyalty. In doing so, it produces a sense of pride in the company and therefore success.
Advantages
This culture allows employees to make decisions and do what it takes to make people happy. Happy customers always come back to buy more. In addition, companies differentiate themselves from their competitors and are preferred by consumers.
Disadvantages
In this case, customers are the focus of attention, so employees can often feel less important. An unmotivated or neglected employee will not perform well.
Example of this type of culture
Airlines and hotels are good examples of organizations with a customer-centric culture. For example, American Airlines and Hilton. These companies care about every interaction with their customers and that they have the best experience. They often demonstrate this by listening to customer feedback through surveys, reviews, and social media.
6. Culture of purpose
This type of culture is characterized by having a clear and strong purpose. The corporate culture is built around a defined purpose and a shared reason for being. This culture attracts employees, consumers, and partners who share its purpose. At the same time, they prioritize serving their community over their profits.
Advantages
This type of culture gives back to their communities or causes that they believe are fundamental. Serving others makes this type of company culture desirable to prospective employees. It also increases employee retention rates.
Disadvantages
Companies with this type of culture prioritize serving others over their direct profit margins. As a result, they tend to make less money than they would normally make.
Example of this type of culture
An example of a purpose-driven culture is the shoe brand, Toms. The brand constantly devotes time and money to charities in different countries. As well as helping local communities with shoes or money to improve living conditions.
7. Innovative culture
The innovative culture focuses on constantly generating the latest and best ideas. In order to improve processes and improve their services to meet the needs of consumers. Companies with an innovative culture are always looking for ways to leverage technology and create solutions. Employees put conventional thinking and methods aside and prioritize new ideas.
Advantages
Innovative culture gives employees the freedom to experiment. This brings many ideas and good solutions. Sometimes ideas that they would not have in another environment because they are considered inefficient.
Disadvantages
Constantly pushing employees with new ideas can result in burnout. Some ideas or experiments may not result in success. Also, technology may fail or not be approved due to cost.
Example of this type of culture
Pixar and Disney Imagineering are companies with innovative cultures. These companies promote new ideas, challenge the status quo, and seek new ways of doing things. In fact, their products and content have notably left traditional culture behind and prioritized innovative culture.
8. Creative culture
Creative culture is characterized by creating new products, services, and stories every day. This culture is focused on the company’s goals, and employees do everything they can to make their visions a reality. Usually, employees work in teams and collaborate with each other on ideas to bring new experiences to the world.
Advantages
A creative culture encourages employees to work together. This way, they support and enhance each other’s creativity on every project. This produces stronger working relationships and reduces downtime.
Disadvantages
Demanding creativity from employees can put a lot of pressure. Reduce productivity and inspiration. Also, leave them worried about not meeting the expectations of their culture.
Example of this type of culture
Companies with creative cultures are those in the entertainment industry. For example, companies like Disney Film, Paramount, Warner Bros, and HBO. All of these companies fit into the creative culture. They stand out for their innovative ideas and stories that people love.
Like knowing your own company culture?
You might wonder how you can learn more about your company, or how to assess your own culture. There are several questions you can ask yourself to better understand your company’s values and culture. You can start by following these tips:
- Get to know your work team. First, observe and analyze the people you work with or collaborate with. Answer these questions: What are their conversations like, what do they say about your work, what do they think about their leader, and about the company in general?
- Motivation: What is the reaction of the employees when new projects or initiatives are announced? Are they happy or are they against some issues?
- Company image. Observe and analyze the company’s image, i.e., the design of the facilities, building, and decorations. Are they maintained, do they look tidy, do they care about the health of the employees, do they care about the health of the employees?
- Employee opinion. Another way to evaluate the culture of a company is to know the opinion of the employees directly. You can do this through employee surveys, interviews, or focus groups. Not only will you get to know the atmosphere of your company, but also the principles and experience of each employee.
Conclusion
In summary, a company’s culture is defined as shared values, but also shared beliefs, attitudes, and experiences. Knowing or studying a company’s culture is important for both image, consumers, and future employees. It helps to understand the company’s nature and environment. In addition, it facilitates decision-making, and promotes cooperation, motivation, and commitment to company goals.
There are several types of the corporate culture. Previously, we shared with you the characteristics of each type of culture, advantages, disadvantages, and examples of companies that fit perfectly. Finally, we share tips to evaluate your company and identify your own culture type. Alternatively, you can answer a questionnaire, with your co-workers, to make the process more interactive and effective.
References
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3. Rodriguez Urrego L, Valderrama Mendoza M. Intelligent Management System for Sustainability [Internet]. ResearchGate. 2018 [cited 2022].
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4. Zalpa G. Studies on Contemporary Cultures [Internet]. Redalyc. Colima, Mexico: Universidad de Colima; 2022 [cited 2022].
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5. Pheysey DC. Organizational cultures types and transformations. London, England: Taylor and Francis; 2003.
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