Corporate Culture - Classification of company cultures - 3.4.2
Role culture - A business where power depends on the person's status or role in within the business; normally businesses with a high level of detailed rules on how people should interact. Clear rules and procedures result in a clear hierarchy (Bureaucratic relationship) where the organisation functions based on each individuals role within a clearly defined structure. The organisation has a tall structure with long chains of command. Personal power is frowned upon, with allocation of work and responsibility more important than individuals personalities.
Benefits include offering employees security and the opportunity to acquire specialist skills, and good employee performance yields appropriate pay and promotion rewards. Drawbacks include the culture being frustrating for ambitious employees and it is overly bureaucratic, which leads to slow-decision making.
Power culture - Usually a strong culture in a business that comes from the center and concentrates power among a small number of people (Centralised decision making and Autocratic leadership) whose influence spreads through the business. There are few rules as those with power decide the rules. Employees are judged by what they achieve rather than how they do their jobs. Decision can be taken quickly through leadership can become very toxic.
Benefits include quick decision making, few rules and bureaucracy, and if the business gets the culture right then employees have high levels of satisfaction and commitment to corporate objectives. Drawbacks are that it can lead to high levels of employee dissatisfaction if employees do not learn and meet the needs of the business and it can quickly become a hostile place to work if things go wrong.
Task culture - When a business creates teams (delegation) to resolve specific issues or projects and power then shifts to team members (Matrix structure). Emphasis on achieving set outcomes through cooperation and teamwork. The success of this culture depends on the team dynamics, including the mix of skills, personalities and leadership qualities. There will be no single power source, with teams developing their own objectives.
Benefits include the organisation being very flexible and sensitive to the market environment, it can be a highly creative experience for staff, and it is particularly suited to short product life cycles and dynamic markets as there is rapid reaction to changing competitive markets. Drawbacks include problems in achieving economies of scale or depth of expertise, and controlling the organisation is difficult as senior managers may concentrate on allocating projects rather than day-today control of teams.
Person/Entrepreneurial culture - A business which is only there to support and help individual employees who perceive themselves as unique or superior (decentralised decision making) and have power over it (democratic leadership); often consists of independent professionals such as doctors or lawyers with similar levels of training and expertise. Risk taking and innovation are actively encouraged and rewarded, whilst failure is not criticised.
Benefits include the organisation being highly creative and individual, with a strong emphasis on customer wants and needs. It is also very quick to deal with the changing needs of the market. Drawbacks include staff are difficult to manage, staff are in demand so turnover can be high, staff are difficult to influence, and corporate objectives are difficult to achieve if they are at odds with individual goals.
Benefits include offering employees security and the opportunity to acquire specialist skills, and good employee performance yields appropriate pay and promotion rewards. Drawbacks include the culture being frustrating for ambitious employees and it is overly bureaucratic, which leads to slow-decision making.
Power culture - Usually a strong culture in a business that comes from the center and concentrates power among a small number of people (Centralised decision making and Autocratic leadership) whose influence spreads through the business. There are few rules as those with power decide the rules. Employees are judged by what they achieve rather than how they do their jobs. Decision can be taken quickly through leadership can become very toxic.
Benefits include quick decision making, few rules and bureaucracy, and if the business gets the culture right then employees have high levels of satisfaction and commitment to corporate objectives. Drawbacks are that it can lead to high levels of employee dissatisfaction if employees do not learn and meet the needs of the business and it can quickly become a hostile place to work if things go wrong.
Task culture - When a business creates teams (delegation) to resolve specific issues or projects and power then shifts to team members (Matrix structure). Emphasis on achieving set outcomes through cooperation and teamwork. The success of this culture depends on the team dynamics, including the mix of skills, personalities and leadership qualities. There will be no single power source, with teams developing their own objectives.
Benefits include the organisation being very flexible and sensitive to the market environment, it can be a highly creative experience for staff, and it is particularly suited to short product life cycles and dynamic markets as there is rapid reaction to changing competitive markets. Drawbacks include problems in achieving economies of scale or depth of expertise, and controlling the organisation is difficult as senior managers may concentrate on allocating projects rather than day-today control of teams.
Person/Entrepreneurial culture - A business which is only there to support and help individual employees who perceive themselves as unique or superior (decentralised decision making) and have power over it (democratic leadership); often consists of independent professionals such as doctors or lawyers with similar levels of training and expertise. Risk taking and innovation are actively encouraged and rewarded, whilst failure is not criticised.
Benefits include the organisation being highly creative and individual, with a strong emphasis on customer wants and needs. It is also very quick to deal with the changing needs of the market. Drawbacks include staff are difficult to manage, staff are in demand so turnover can be high, staff are difficult to influence, and corporate objectives are difficult to achieve if they are at odds with individual goals.
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