Organizational culture is important to the success and overall health of your organization, your people, and your customers. So it’s helpful to spend time considering why your organization’s culture is the way it is and whether it needs to change.
This section will help you identify what your culture is and provide tips to make sure it’s appropriate for your organization’s goals.
Definition and Implications
Culture is at the core of an organization. It guides actions and sets the tone for how work is done and how people interact with one another within the organization and externally.1 It has also been defined as the process of “sense-making” that provides a basis for purpose alignment and shared action. In response to external and internal changes, cultures are dynamic. When trying to assess your organizational culture, it’s important to understand that it is a moving target that is better managed as a continuous process rather than a stable organizational trait.
Culture is powerfully shaped by incentives. The best predictor of what people will do is what they are incentivized to do. While monetary rewards are a strong incentive, so is creating a culture in which people feel recognized for their efforts. For instance, incentives can include job title promotions, awards that highlight outstanding contributions, and sponsorships to attend professional conferences or training programs.2
There is no “best” organizational culture because it is always contextual. Different people in the same organization can have different perceptions of the culture of the organization. These differences are especially noticeable when looking at the top and bottom levels of the organization or at various teams within an organization, such as the finance and development teams.
Roles: Pirates, Privateers, and Petty Officers
As your organization starts to take shape and mature, what is required of your team and organization staff will evolve. For example, you may have started out with a small group of people working on the prototype for your digital solution, and those people were likely innovative and interested in driving transformational changes in the sector. But as your organization grows, these individuals might not have the skills needed to run multiple pilots in different contexts. They might struggle to make the transition to sustainability and scale, where systems, processes, administration, and bureaucracy tend to grow.
The early days of developing prototypes are generally initiated by and attractive for pirates, who are inventive, innovative, disruptive, and slightly rebellious. Your digital solution would never have gotten off the ground without them.
Mature organizations have developed administrative systems, policies, and procedures and are generally looking for incremental improvements to their products, services, and systems. They are usually staffed with petty officers, who follow standard operating procedures, systems, and processes.
The transition from a start-up pirate ship to a mature navy with petty officers is often a difficult one and doesn’t happen overnight. Petty officers and pirates generally want very different things from their work environment. But the difficulties of this transition from a small team to a mature organization can be eased with privateers, who are pirates that have developed the skill of working within the navy. Privateers are also crucial for growing digital solutions in established organizations. It is critical to have privateers on the team from the start, as you will be developing your digital solution in an organization that already has policies, systems and procedures that will need to be adhered to.
Being able to identify how many pirates, privateers, and petty officers you have on the team and whether you need to change the balance of roles to reach sustainability and the appropriate level of scale is a critical skill to develop.3
When an organization is growing, it can become trapped in the need for structure and discipline, which can hinder the culture of creativity that is so vital to future success. Culture has an enormous influence on facilitating or retaining innovation. As teams and organizations mature and build policies, procedures, and processes, work often becomes more efficient, and it can provide confidence for investors and funders. However, it is also the road to becoming bureaucratic. Therefore, you should have a few pirates and a lot of privateers around to ensure this doesn’t happen.
Another way of retaining an entrepreneurial culture is to engrain the following four elements into your culture:
- Openness: Be open to sharing information and lessons learned from success as well as failure.
- Adaptability: Monitor and seek feedback and use the results to identify possibilities for change and improvement.
- Results and rewards: Be dedicated to tracking outcomes and impact but also rewarding the right behaviors, including organizational citizenship.
- Learning organization: Encourage employees to grow and learn.
Diversity, Equity, and Inclusion (DEI)
As mentioned previously, organizational culture is important to the success of your organization, your people, and your customers. How your organization fosters a diverse, inclusive, and equitable organization is a critical component of an organizational culture. An inclusive culture has positive ripple effects across all major aspects of organizational growth, from recruitment to talent management and retention, productivity and financial growth. Organizations who are committed to DEI are constantly evolving and growing based on the needs, challenges and discussions that arise from embracing commitments to a DEI culture.
Diversity, equity, and inclusion are each vital that must work together to fully benefit an organization. Each organization should define and commit to each of these three components as a first step in inculcating a DEI culture:
- Diversity: A wide range of national, ethnic, racial and other backgrounds existing within a culture and is often used to include aspects of race, ethnicity, gender, sexual orientation, class and much more.4
- Equity: Providing access to opportunities across an organization regardless of identity or group memberships taking into consideration historical and contemporary conditions that may create different starting points.5
- Inclusion: Inclusion authentically brings traditionally excluded individuals and/or groups into processes, activities and decision/policy making.6
Having a diverse workforce accentuates the need to ensure psychological safety at work. Project Aristotle, a research project conducted at Google in 2012, found that psychological safety was the number one priority for team members. Psychological safety is when people feel that they will not be punished or humiliated for speaking up with their ideas, making mistakes, or holding an alternative worldview. There are four stages of psychological safety, according to Dr. Timothy Clark:
- Stage 1 – Inclusion safety: Inclusion safety satisfies the basic human need to connect and belong. In this stage, you feel safe to be yourself and are accepted for who you are, including your unique attributes and defining characteristics.
- Stage 2 – Learner safety: Learner safety satisfies the need to learn and grow. In this stage, you feel safe to exchange in the learning process by asking questions, giving and receiving feedback, experimenting, and making mistakes.
- Stage 3 – Contributor safety: Contributor safety satisfies the need to make a difference. You feel safe to use your skills and abilities to make a meaningful contribution.
- Stage 4 – Challenger safety: Challenger safety satisfies the need to make things better. You feel safe to speak up and challenge the status quo when you think there’s an opportunity to change or improve.
There are five steps that help nurture psychological safety:7
- Make it an explicit priority
- Facilitate everyone speaking up
- Establish norms for how failure is handled
- Create space for new ideas
- Embrace productive conflict
Mapping and Building Culture
Although established in the first stages of a new team or organization and considered the most significant aspect of any organization, culture is not permanent. It can be changed, but it’s hard to do. As Peter Drucker said, “Culture eats strategy for breakfast.” Your organizational culture can be your most important asset or your biggest deficit when it comes to sustainability. Therefore, it is critical that culture be developed deliberately.
If your team or organization is older than a couple of months, it has already developed a culture. So the first stage in thinking about developing your culture is to baseline it. Ask the question: What is your culture today? Use the Culture Web exercise discussed below to help map your culture.
- Stories: How an organization understands and explains itself
- Rituals and routines: The accepted norms and practices
- Symbols: The physical artifacts or the unofficial and official representations of culture
- Organizational structures: The formal structures and hierarchy, as well as the informal routes of power and influence
- Power structures: The people and systems that have the power to get things done
- Control systems: How an organization controls how things are done
Steps to mapping and building culture:
Step 1: Identify the key features in each of the six elements and discuss which features are having a positive impact on your culture, and discuss how to retain them. Then assess which aspects are having a negative impact on your culture and are holding your organization back. Decide how you are going to eliminate them from your culture.
Step 2: Develop a culture statement of what you aspire to be as a team or organization. This should not be a bunch of aspirational words, but rather a well-thought-out statement that articulates what your unique culture is going to look like. It should be one sentence. This will be the paradigm for the center of your culture web. The shorter the better!
Step 3: Create a new culture map by capturing what features you want to have in each of the six elements. This can be done by remembering stories from the past that highlight the culture you want to build; developing new rituals, routines, and symbols; or highlighting changes that need to occur in your organizational and power structures and control systems.
Step 4: Have a culture meeting at least once a quarter to monitor how your cultural changes are being rolled out and what effect they are having on your organization.
Culture isn’t static or passive. It is something that you need to keep consciously developing. Key points to consider are:
Organizational culture is very important to the success and overall health of your organization and its sustainability.
Ensure that you have the right mix of pirates, privateers, and petty officers for the maturity of your team or organization and the culture you are trying to build.
Building an inclusive culture that enhances psychological safety is something that you need to commit to and proactively manage.
Map your culture with your team and collectively identify areas for improvement.
Complete the following in your Business Model Sustainability Canvas:
- Insert the brief culture statement that you have created in the culture web exercise.
- Corporate culture and performance: relating concepts and outcomes↩
- Beyond scale, p210↩
- Humanitarian Innovation Guide↩
- Institute for Democratic Renewal and Project Change Anti-Racism Initiative. A Community Builder's Tool Kit↩
- National Alliance for Partnership in Equity: Glossary↩
- Crossroads Charlotte Individual Initiative Scorecard for Organizations Scorecard Overview, revised 3/12/07↩
- Center for Creative Leadership↩
- Cultural Web↩