What is Organizational Culture?
"Culture eats strategy for breakfast, operational excellence for lunch, and everything else for dinner.”
Organizational culture is the unique way that an organization forms and defines itself in terms of its shared values, worldviews, principles, traditions, customs, rituals, stories, practices and unwritten rules that distinguish it from other organizations. This includes the ways the organization conducts its business, treats it employees, customers and the community of which it is a part. Its culture affects its productivity, customer service, marketing and advertising practices, HR policies and capacity for innovation. Increasingly, it also includes its environmental and social responsibility practices. Organizational culture is unique for every organization and is one of the hardest things to change. It is influenced by national culture as well. It is also well established that organizational culture is a significant barrier to successful mergers and acquisitions. Most mergers fail due to cultural incompatibilities. A 2015 KPMG study indicates that 83% of merger deals do not boost shareholder returns because of the failure to manage cultural issues.
Organizational Values Tracks
Organizational Culture may be also understood as an emergent property of its Values System and is measured and profiled through analysing how the values combine to work together as Values Tracks or themes that illustrate the shared beliefs about “how things should be done around here”.
Each organizational Values Track contains multiple values that are profiled in our Organizational Culture Values Inventory report. This report identifies the primary Values Tracks for a group, team or an entire organization and can help to determine which types and combinations of group values, and their priorities comprise its culture. The chart below illustrates an example of the combination of values and their measured priorities for the Values Tracks of Customer Focus and Learning & Innovation for a senior team within the Minessence International COOP.
Example Values Tracks and Their Values
Organizational Values Tracks as a Strange Attractor
The diagram below shows three other example Values Tracks which relate the values and beliefs of people in an organization to how they act (Action), how they create organizational structure (Order) and whether they are doing things primarily for their own benefit or to add value to their clients (Share).
Values are both primary individual and group motivators. Values Tracks which coalesce within an organization become a collective pattern which motivate group behaviours and can profile organizational culture. These patterns are called Strange Attractors.
Strange Attractors create a certain form of order within any complex non-linear system be it the weather, a bushfire, the stock market, societal cultures, an organization, a team or an individual person. For living entities, their values system is their Strange Attractor.
Why do we use the term Strange Attractor instead of simply referring to values as attractors?
The term Strange Attractor comes from the study of complex systems which exhibit "order within chaos". Chaos Theory and non-linear system researchers discovered that certain entities behaved in strange ways yet their behaviours were obviously being influenced by a strong attraction to something. Attractors which led to entities behaving in strange and not entirely predictable ways became known as Strange Attractors. Attractors which lead to predicable behaviours are termed ordinary attractors. Gravity is an example of an ordinary attractor. With ordinary attractors such as gravity, one can mathematically compute exactly what will happen in the future. For example, if a person drops a ball from 1-meter height, it can be calculated precisely when that ball will land. When an entity's behavior (motion, actions, path, etc.) is governed instead by a Strange Attractor, one cannot predict what will happen in the future, however, one can predict the general form or nature of what will unfold.
For example, a person with priority values of achievement, competition, work, financial success, and duty will be attracted by these values to behave in a completely different way to someone who has priority values of expressiveness/freedom, play, intimacy, search/meaning, service, equity/rights. Clearly in both these examples you cannot know what each person will do moment to moment, however, you will know with a fair degree of certainty the general nature of how they will behave as their life unfolds. For each person, their values-system (in its role as a Strange Attractor) gives a sense of order to their life. So it is with teams, organizations and different cultural groups.
One explanation of the way Strange Attractors work is to consider fish in an ocean. As the water moves in synchronism with the current or swell, the fish all appear to move together from side to side or up and down as though connected by some invisible connector-- of course, we know that it is the water of the ocean. A similar phenomenon is seen in flight patterns of birds. Strange Attractors behave the same way: we cannot see them and they (unlike the water of the ocean) have no material substance, yet, they link all material objects. In Newtonian Physics physical reality is considered to be solely a material reality. The existence of Strange Attractors has caused us to change our notion of reality since no one will dispute that they are real, but they have no material substance. This is a working assumption of Quantum Physics.
Translated into our understanding of modern organizations, we can differentiate a Newtonian Science Organization from a Quantum Science Organization.
The Newtonian Science Organization
The Quantum Science Organization
An organization is a collection of choices looking for problems, issues and feelings looking for decision situations in which they might be aired, solutions looking for issues to which there might be an answer, and decision makers looking for work.
Organizational order is provided through motivational energy ordered by Strange Attractors. Order is thus created and maintained through conceptual controls–people's values, ideas and beliefs are creating the order, not some manager with authority. The strongest motivational energy emanates from shared meaning–the source of the organization’s values-system–the Strange Attractors which create and maintains its culture.
Organizational Culture Values Tracks
The example above looked at how values may coalesce to form a Strange Attractor along just three dimensions or tracks: Action, Order & Sharing. The Minessence Values Framework typically uses eight Values Tracks to analyze the Strange Attractor(s) shaping an organization’s culture:
- Creating Value (multiple bottom lines)
- Customer Focus
- Learning & Innovation
- Respect, Trust & Openness
- Team Work & Collaboration
- Organizing/Creating Order
- Resilience & Renewal
- Social & Environmental Responsibility
The following diagram illustrates the pattern of Values Tracks (motivational energy) which emerges from the coalescence of values priorities of a senior team within our own Minessence International COOP organization.