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11 types of organizational culture — and choosing the best one

October 31, 2022 - 18 min read
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    Your organizational culture plays a huge role in your ability to attract and retain top talent. With the right culture, employees will flock to your company — and stay there. But if talent here’s that your company has an unsupportive or toxic culture, you’ll have a hard time building a team.

    But what makes for a good culture — and how can you choose the best culture for your team and organization?

    Let’s take a look at the different types of organizational culture — and how to choose a culture that empowers your team’s best work.

    What is organizational culture?

    First things first. Before we jump into the different types of organizational culture (and which might be the best for your team)? Let’s quickly touch on what, exactly, organizational culture is.

    Organizational culture is generally set by organizational leadership and business leaders. From there, it trickles down through the organization. Ultimately, it influences how other employees behave and interact. It also determines whether an employee feels like the organization is a good fit for their goals and personality. (That’s where the term “culture fit” comes from).

    Organizational culture dictates how — and how successfully — things are done within a company. That includes wide-reaching tasks (like hitting a major strategic goal). It also includes more one-on-one interactions (like how employees speak to each other).

    Organizational culture has a major impact on how a company operates. As such, it typically impacts just about every facet of a business. This includes everything from employee retention to productivity to work-life balance.

    Organizational culture is a commonly used term. But it's not the only term used to describe culture. Alternate terms include workplace culture, company culture, or corporate culture.


    4 types of organizational culture

    Now that you understand what organizational culture is, let’s take a look at the different organizational culture types.

    One of the most commonly used frameworks for understanding workplace culture is the Competing Values Framework. Developed by Robert E. Quinn and Kim S. Cameron of the University of Michigan’s Ross Business School, the Competing Values Framework outlines four different types of corporate culture:

    Clan culture

    As the name suggests, clan culture is all about the “clan.” Or, in other words, the people that work for an organization.

    In a clan culture, collaboration and teamwork are the foundational company values. Employees are valued above all — and in general, there’s a “we’re a family” attitude that permeates how people interact within the company. There is also typically a “hands-on” approach to people management. In this type of culture, leaders take an active interest in mentoring and developing their team.

    A clan culture can lead to a variety of positive outcomes. This includes better employee retention, higher employee engagement, and a more positive employee experience.

    Putting employees first can also have a ripple effect that spreads to customers. When employees are happy, engaged, and feel taken care of at work, they then treat customers with the same level of care and respect. This can lead to higher levels of customer satisfaction and a better overall customer experience.

    Clan culture offers a number of benefits. But it also presents some challenges. This kind of organizational culture can be hard to maintain as an organization grows. That’s why, out of all of the types of company culture, this one is best suited to start-ups and smaller companies.

    Adhocracy culture

    If you’re a company that’s looking to change and innovate — and you aren’t afraid to take risks to do so? Chances are, you’re embracing adhocracy culture.

    Organizations with an adhocracy culture value innovation, risk-taking, and pushing boundaries. They know that in order to really change things, they need to be willing to do things that have never been done. That rings true whether they're developing a new technology or disrupting their industry.

    And sometimes, innovating means failing, reevaluating, and changing course. Which is why adaptability is another foundational aspect of adhocracy culture.

    While adhocracy cultures embrace failing and changing course, it’s also a results-oriented culture. New ideas are encouraged — but those ideas need to be tied to the organization’s growth and success.

    In an adhocracy culture, employees are encouraged to “think outside of the box” and come up with innovative solutions to problems. This can lead to higher levels of creativity and engagement.

    But adhocracy culture also has some definitely drawbacks. For example, constantly needing to come up with new, innovative ideas isn’t the right environment for every kind of employee. In fact, for some, it can lead to higher levels of burnout. And while adhocracy culture embraces risks, it’s important to remember that not every risk will turn out in the company’s favor. This can lead to spending a lot of time and energy on ultimately unsuccessful projects or ideas.

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    Market culture

    Some companies care about success, profit margins, and their bottom line above all else. And those companies? Their culture is what’s known as a market culture.

    With a market culture, everything is results-driven and ties back to the company’s financial performance and success. Quotas, metrics, and financial data are held in high regard. Every decision made for and within the company is looked at through a financial lens. That includes decisions directly related to company performance. (Think new product launches or sales strategies). It also includes things that are indirectly related (like employee benefits or wellness programs).

    Unlike clan culture, which often has business leaders working directly with employees, market culture usually has multiple established levels of leadership and management. And there's generally separation between the levels. (So, a lower-level employee isn't likely to be mentored by a company leader).

    The main benefit of a market culture? Results. Because market cultures prioritize profits over everything else, they’re generally profitable. But the major drawback? In this kind of culture, it’s easy for employees to feel like they’re just another cog in the wheel, which can lower engagement. In this results-driven environment, there’s also a much higher risk of burnout, which can lead to high turnover.

    Hierarchy culture

    If adhocracy culture is all about taking risks, hierarchy culture is the opposite. It’s all about structure, tradition, predictability, and stability.

    In hierarchy culture, there is a clear, established order in the company. This order includes with multiple layers of separation between leadership and employees. There are also clearly established systems and processes. In hierarchy culture, the goal is to have the organizational function like a well-oiled machine — and to not deviate from what’s working. Hierarchy culture is particularly popular with more traditional companies. It's also a popular choice for companies that need a lot of structure, processes, and systems to function effectively.


    7 additional types of workplace culture

    While Quinn and Cameron’s types of company culture are the most recognized, they aren’t the only type of workplace culture that exists. Some additional types of organizational culture you may see in the workplace include:

    • Positive culture. A positive culture is one where creating a positive, supportive work environment is valued above all else.

    • Purpose culture. In a purpose culture, the company’s core values and mission drive the culture.

    • Feedback culture. In a feedback culture, feedback is welcome, encouraged, and fused into the company’s DNA. This includes informal and formal feedback. It also includes both upward (employees to managers) and downward (managers to employee) feedback.

    • Coaching culture. In a coaching culture, business leaders take a mentorship approach to management. They use coaching techniques to help their employees to reach their highest potential.

    • Accountability culture. In today’s work environment, many businesses are focused on creating a culture of accountability. This means that everyone within the company — from new hires to the CEO — is held accountable for their actions. And the company, as a whole, is held accountable for its practices.

    • Control culture. In some companies, leaders control their teams through fear. This is known as control culture — and can be extremely damaging for the employee and the organization.

    • Learning culture. In a learning culture, the focus is on professional growth and development. Companies with a learning culture generally have robust L&D programs. They invest in helping their employees grow as professionals and individuals.

    How HR and leadership influence company culture

    Company culture falls under the people operations or human resources management umbrella. And HR departments can have a huge impact on organizational culture.

    But how? In what ways can HR directly impact organizational culture?

    Using employee feedback and insights to drive culture decisions

    One of HR’s most important functions is getting feedback from employees. Feedback about what’s working, what’s not working, and what they’d like to see change. Feedback HR leaders can then use to drive culture decisions.

    For example, let's say you're reviewing your employee engagement survey results. And you may find morale took a drop after employees returned to work post-COVID. In that situation, you could take the data to leadership and make the case for embracing a hybrid work culture.

    The point is, HR leaders have access to invaluable employee feedback. They also have the power to make decisions that influence company culture. And by combining the two? They can influence company culture in a way that benefits team members.

    Translating company values into actionable policies, procedures, and processes

    Company culture should be driven by company values. But when you have broad values like “sustainability” or “integrity,” it can be hard to see those values in the day-to-day operations of a company.

    That’s where HR comes in. HR is responsible for translating company values into actionable policies, procedures, and processes. And those policies, procedures, and processes are what bring the values to life in the organizational culture.

    For example, let’s say your organization is embracing a clan culture and wants to put people first. It would fall on HR to implement the policies, procedures, and processes needed to show employees that they’re valued and central to the culture. (For example, rolling out an employee wellness program or offering more competitive PTO).

    Or let’s say your organization is building a culture around diversity, equity, and belonging. It’s HR’s job to lead the company’s diversity strategy and putting DEI practices into place. For example, they might revamp the employee handbook to be more inclusive. Or they might overhaul the company’s sourcing and hiring strategy to create a more diverse workforce.

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    Bottom line? Company values are a concept. Company culture is tangible. And HR is the department that bridges the two. HR turns conceptual core values into tangible policies, procedures, and processes.

    Helping to foster needed change

    As mentioned, HR is the ones who set the policies that drive company culture. So, if there are things that need to be improved or changed within the current culture? HR gets to foster that much-needed culture change.

    For example, let’s say leadership realized that they’ve been embracing a market culture. But they want to start putting a heavier focus on treating their employees well. HR would lead the charge in fostering that culture change. For example, by writing new policies to planning training sessions to help get leaders up to speed on new leadership techniques.


    How to choose the best type of organizational culture for your team

    There are a variety of organizational cultures your company might use. So how do you choose the best one for your team?

    • Define your company values. Your organizational culture should be driven by your core values. So, in order to choose the best organizational culture for your team? You need to define what your values are.

    • Compare your core values with the different types of workplace cultures. Once you know your corporate values, compare those values to the different types of workplace cultures. You’ll want to look for alignment. For example, if “achievement” is one of your core values, a market culture would align with that value. If one of your foundational values is “people first,” you’d likely be better served by clan culture.

    • Weigh the pros and cons. Every type of organizational culture has pros and cons. And before you choose the best culture for your team, you need to weigh those pros and cons. The right culture for your team will have more pros than cons — at least from your organization’s perspective.

    • Ask your team for their insights. Want to know how to choose the best type of organizational culture for your team? Ask them! Ask your team to share what kind of culture would empower their best work. Then, build an organizational culture that delivers on their requests.

    Steps to implement a new organization culture

    You know the different types of organizational culture. You know how to choose the best workplace culture for your team. Now, let’s take a look at how to implement that culture.

    There are a few steps to implement a new organizational culture, including:

    1. Evaluate your current culture and identify gaps.

    2. Ask for employee feedback.

    3. Create a plan.

    4. Get leadership buy-in.

    5. Continue to monitor and adapt as necessary.

    Let’s take a look at each step more closely:

    1. Evaluate your current culture and identify gaps

    Before you can implement a new organizational culture, you need to take stock of your current culture. From there, you can identify any gaps between the culture you have and the culture you’re trying to build.

    Understanding the gaps between your current culture and your ideal culture will help drive your strategy.

    2. Ask for employee feedback

    When you implement a new organizational culture, you want it to ultimately benefit your team. So, before you make any big changes? Ask your team members for feedback.

    Ask your employees to share their feedback about the culture. What’s working, what’s not working, what they’d like to see change, and what kind of culture would work best for them. Then, use that feedback to drive your strategic decisions.

    3. Create a plan

    Once you’ve evaluated your current culture and asked your employees for insights, it’s time to actually create your strategy.

    Create a clear, actionable plan for how you’re going to implement your new organizational culture. What are your goals? How are you going to measure success? What policies, procedures, and processes are you going to implement to foster this new culture?

    Think of this plan as a road map. From a company culture standpoint, it should lay out how to get from where you are now to where you want to be. And it should do so in as much detail as possible

    4. Get leadership buy-in

    Implementing a new organizational culture takes not only time and energy, but support and resources. And in order to access that support and those resources? You need to get buy-in from leadership.

    Present your culture plan to leaders and get them on board. Ask for their insights. Get them involved in rolling out the culture to employees.

    Organizational culture has a trickle effect; it starts at the top. And the more involved and committed your leadership team is to your new workplace culture? The more effectively it can be implemented across the organization.

    5. Continue to monitor and adapt as necessary

    Implementing a new organizational culture isn’t a one-off project. Certain initiatives are going to be successful. Others are going to fall flat. And if you want your new culture to not only be implemented, but have a net positive impact on your team? You need to monitor how it’s being adopted — and adapt as necessary.

    For example, let’s say you’re implementing a hierarchy culture and are trying to lock in more efficient processes. If you roll out a new process and your employees complain that it’s too rigid, be willing to listen — and change it if necessary.

    The best company cultures are the ones that evolve, grow, and change with their team. So, as you implement a new organizational culture? Keep an eye on how it’s landing with your employees — and be willing to change, adapt, and pivot as necessary.

    Choose the best organizational culture for your team

    You want to implement an organizational culture that works for your company and your employees. And now that you understand the different types of organizational culture — and how to choose the right one for your team — all that’s left to do? Get out there and implement the right workplace culture for your company and your employees. (And watch your organization thrive as a result).

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    Published October 31, 2022

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