What is Business Culture?
Business culture is not just how the individuals within an organisation understand it, but also how others perceive a business.
It is easy to see that one business is different from another. however, it is also possible to ‘feel’ how a business is different, and that involves more than just how it presents itself to the outside world.
‘Culture’ can be used to explore the identity of a business. It offers a powerful insight into the business and what it is like to work there or do business with the organisation.
Definition of Business Culture
‘Culture’ is the beliefs and expectations shared by members of an organisation that produce norms that powerfully shape the behaviour of individuals and groups within that organisation’.
Factors Influencing Business Culture
Where the culture originates, and how it develops, is often due to the influence of a dominant leader.
The vision, values, management style and personality of the founder or leader will have a significant influence on the culture of that business.
Other factors that can also influence the culture of a business are:
- the history and tradition of the business – how things have always been done (and why);
- the customers of the business – who they are and what they expect;
- type of business and legal requirements of that business;
- the systems and processes within the business;
- the reward systems and the measurement of performance;
The culture of a business has to be learnt by newcomers and it takes time to understand. New employees learn what is acceptable and what is not from their peers. These less obvious rules may not be written anywhere but are understood within the organisation. It is simply how things are done there.
They are often communicated through:
- These are the rites, rituals and ceremonies of the business. These can take many forms such as the annual Christmas party, or meetings and reviews.
- These are the stories, myths and slogans that are circulated in the business. Stories about notable events in the past tend to become part of the culture of the business and can influence behaviour. How the business started, for example, or a period of particular success that became the new target to aim for.
- Physical forms
- These include the location and appearance of the business. The physical impression of uniforms, cleanliness, state of repair all suggests something about the business and the culture within.
- A common language
- Jargon is common to many businesses. It is a convenient shorthand form of communication, but it also affects behaviour. McDonald’s employees are ‘crew members’ which infers teamwork and cooperation.
Culture is the very essence of the organisation, it defines how things are done and what is expected. Therefore, culture is an extremely powerful force within any organisation.
Peter Drucker said ‘‘culture eats strategy for breakfast”. However, too many businesses do not spend enough time considering their culture.
If the business strategy and culture is not aligned, the resulting conflict will almost certainly lead to confusion for both staff and customers alike.