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What is organizational culture?

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Although all companies have an organizational culture, only some of them strive to develop a specific culture plan or code that is distinctive of their employer brand or “Employer Branding“. The difference between those that strive and those that do not, lies in that the first ones seek to improve while the latter tend to remain static. A solid organizational culture helps to increase employee engagement and the lack of a proposal can have negative financial consequences for companies due to the lack of a coherent mission and trust-based working relationships.

The importance of having a solid organizational culture in Human Resources lies in its ability to attract new talent. Organizational culture refers to the principles that define a company’s personality and establish the foundations for its processes and attitudes. Each company has its own organizational culture. It is essential to define it correctly to achieve proper management of human talent.

What is organizational culture?

Organizational culture refers to the norms and values that guide the conduct of a company. It relates to the structure of the company, the methods of work performance and the way employees interact with each other. It is essentially the “psychology” of the organization, its core.

It is composed of a system of values, beliefs and assumptions that determine how people should behave and interact, how decisions should be made and how work tasks should be carried out. Leaders establish the organizational culture and then communicate and reinforce it through different methods, which helps to form employees’ perceptions, behaviors, and understanding, and define the correct way to behave within the organization.

Organizational culture or work culture is what guides and informs the actions of all team members as to how decisions should be made and how work activities should be carried out. Although it affects all the behaviors, thoughts and patterns of behavior of employees, people are usually more aware of the culture of their organization when they have the opportunity to compare it with other organizations.

Characteristics of organizational culture.

Organizational culture is composed of several important aspects, some of which are:

  1. Shared values: At the heart of organizational culture are shared values. There are no right or wrong values, but organizations must decide which values to emphasize to promote harmony in organizational citizenship.

Here it is evident how corporate values are the key to good leadership and excellent talent management within an organization.

  1. Hierarchy levels: Hierarchy levels are the measure by which the organization establishes and reinforces authority among different areas and departments. The three hierarchy levels are:
  • High: Involves having a well-defined organizational structure and expecting people to work through official channels.
  • Moderate: Having a defined structure but allowing people to often work outside of formal channels.
  • Low: Involves having poorly defined job descriptions and allowing people to challenge authority boundaries.

2. Quick decision-making: The speed at which the company makes decisions that can cause a big change in the organization and foster innovation is related to the level of urgency. Some organizations can control their decision-making speed, while others are determined by the market.

3. Functional focus: Each company focuses on specific areas, which can make employees from different functions think that their areas are the ones driving the organization. Leaders must understand how employees perceive the company’s functional focus in order to drive all areas in an integrated way.

  1. Subcultures: Any organization can have a mix of subcultures in addition to the dominant culture. These subcultures exist among groups or individuals who may have their own rituals and traditions, which although not shared by the entire company, can reinforce the fundamental values of the organization.

how to establish organizational culture?

To establish a solid and fixed organizational culture, it is necessary to follow certain steps:

  1. It is important to create and communicate meaningful values that guide the behavior and interactions among members of the organization, customers and the community. Leaders must ensure that the expected behaviors associated with each value are understood. Encouraging proper leadership is one of the main concerns of the company. This affects not only the work but also the motivation and well-being of the employees. That’s why new terms appear in human talent management, such as “neuroleadership“, a key factor to create values and communicate them properly among members of an organization.
  2. It is relevant to select the right staff, ensuring that candidates fit with the values and organizational culture of the company. This can be achieved by using interview questions adapted to the fundamental values of the company, or by using a behavioral interview approach in which candidates have to participate in an activity as part of the selection process.
  3. Improve orientation and incorporation of new employees. It is essential to provide an effective and attractive incorporation process for new employees during their first weeks on the job, with a well-structured program covering the first 90 days of work. This will help new employees prepare to be successful in the company and feel connected to their work, team, and organization.
  4. Show concern for employees. It is important to show employees that they are valued as individuals and that efforts are being made to improve the company’s organizational culture. One way to do this is through a continuous workplace culture monitoring program, in which the needs of employees are heard and acted upon. It is important to pay attention and listen empathically, show respect and appreciation for employees, get to know them and understand their concerns, and be honest and open in communication to establish trust.
  5. Leaders should involve employees throughout the year to align them with the company’s mission and goals. This is achieved by communicating the purpose of the company, annual goals, and action plans. It is important to keep employees informed about the company’s results and progress towards goals, and involve them in developing plans to improve the company. This will lead to a better understanding of the organizational culture, increased employee engagement, and an appropriate work environment.

As it can be seen, organizational culture is essential for the success of any company or institution, as it is the foundation that binds employees together and allows leaders to achieve overall goals. It is one of the most important elements for the growth of an organization.