3 minute read 19 Jul 2021
Three women having a conversation in the office breakout area

How leaders can master the art of culture change

By Amy Walters

Manager, EY Lane4, EY Professional Services Limited

Specialises in human performance with a focus on applied psychology. Translates academic thinking and research into practical solutions for business. Visiting lecturer at Bath University.

Contributors
3 minute read 19 Jul 2021
Related topics Workforce Corporate culture

Understanding organisational culture is essential when trying to make change a success and driving business performance.

In brief

  • Identifying the values, behaviours and beliefs that are unique to your organisation’s culture is key when initiating change.
  • By adopting a multi-faceted approach to culture, leaders can develop effective change management strategies.
  • Organisational culture can be leveraged as a tool to drive performance.

Organisational culture has an undeniable impact on performance. Yet, despite decades of academic research exploring the topic, many business leaders remain baffled by what it is, what it does and how to change it. This report draws on a range of psychological and occupational research on organisational culture to present a clear view that leaders can understand, adapt and execute in their own organisation.

Understanding organisational culture

Organisational culture can be a complex concept, it best understood as being comprised of three parts: a social phenomenon, a multi-layered experience and comprised of both an overarching unified culture and subcultures.

  • Culture, as a dynamic social phenomenon: By this we mean that an organisation’s culture is engineered by its people. It constantly evolves, as employees interact with each other, and they make sense of these interactions. As such we take the perspective that culture is not just a fixed, clearly defined entity that is obtained upon joining an organisation. Rather, it is intricate and is only made more complex by its fluidity.
  • A multi-layered experience: In line with the organisational culture literature, we also take the perspective that organisational culture is multi-layered.There are elements of a company’s culture that are explicit, such as what is formally articulated and the parts of the culture that are experienced on a day-to-day basis. There is also the implicit, shadow side or culture known as a 'deep culture' which is comprised of the unquestioned suppositions and beliefs that steer the culture that is lived. 
  • Comprised of many subcultures: An organisation may have a dominant culture. One that is overarching or shared across various business units and typically based around embedded or core values. However, differences such as department or function and geographic location gives rise to smaller subcultures. Whilst it can be helpful to have a shared culture across an organisation to unify your people around core values, these diverse subcultures can be highly beneficial to an organisation. For example, our research posits that a major benefit of having subcultures is that they enable the flexibility for hubs across the organisation to promote innovation.

In understanding organisational culture as a fluid social phenomenon — determined by the salient values, behaviours and beliefs which mould people’s experience within a company — you will be in the best position to identify how you can improve and change your company’s unique culture.

Register to download the full report: The art of culture change (PDF, 1.7MB)

Why is organisational culture important?

Whilst organisational culture may seem like an elusive concept, business leaders should not ignore the massive impact it can have on their organisation.2 From an increase in organisational performance, such as boosting employee engagement and retention to increasing market share, there is an undeniable competitive advantage in valuing organisational culture. Moreover, organisational culture and the success of business strategy are linked.3 Research, suggests that without a healthy culture investment into business strategies are likely to be done in vain or at the very least will have to reduce the impact.4

Successfully transforming culture

Erroneous ways of thinking about culture can hinder your organisation from developing a culture that allows your team to thrive. In this whitepaper, we have dispelled four myths that are often held about organisational culture which can derail culture change:

  • Leaders are the sole agents of culture change.
  • There’s a universal recipe for good culture.
  • A strong culture is always better than a weak one.
  • Culture change takes ages.

There is often a misconception that because culture is entrenched within an organisation there must be drastic and complex action, to execute a successful culture change. However, our research confirms that this is not the case. For effective culture change, you need to have a comprehensive understanding of your current cultural context and your organisations' cultural blind spots. Instead of making radical changes, take the time to do your due diligence to identify the specific changes that will result in a major positive difference. From how to use behavioural triggers to supporting culture change champions the report delves into insights that will enable you to shift your culture to a high-performing one.

  • Show article references#Hide article references

    1. C. Rodgers, “Informal coalitions: Mastering the Hidden Dynamics of Organizational Change”, Human Resource Management International Digest, 2008.

    2. C.A. Hartnell, A.Y. Ou, & A. Kinicki,“Organizational culture and organizational effectiveness: a meta-analytic investigation of the competing values framework’s theoretical suppositions”, Journal of Applied Psychology, 2011.  

    3. D.R. Denison & A.K. Mishra, “Toward a Theory of Organisational Culture and Effectiveness.”, Organisation Science Corporate Culture and Performance, 1995.

    4. Y. Wei, S. Samiee, & R.P. Lee, “The influence of organic organizational cultures, market responsiveness, and product strategy on firm performance in an emerging market”, Journal of the Academy of Marketing Science, 2013.

Summary

Organisational culture has been long be viewed as a phenomenon shrouded in mystery. Business leaders must see it as a tool to drive performance. This can only be done when you understand the art of culture change.

About this article

By Amy Walters

Manager, EY Lane4, EY Professional Services Limited

Specialises in human performance with a focus on applied psychology. Translates academic thinking and research into practical solutions for business. Visiting lecturer at Bath University.

Contributors
Related topics Workforce Corporate culture