For employees to devote themselves to their work with peace of mind, it is necessary to foster a good organizational culture in the first place. However, the organizational culture is naturally established, and it is often difficult to notice problems from an insider’s perspective alone. In this article, we will explain the necessity and merits of improving the organizational culture for the management of companies aiming to reform the organizational culture.
Table of contents
- What is a good “organizational culture”?
- Elements that make up organizational culture
- Advantages of fostering a good organizational culture
- Background of calls for reform of organizational culture
- Points to remember when transforming the organizational culture
What is a good “organizational culture”?
What kind of organization is a good “organizational culture”? In the first place, organizational culture is the values and perceptions shared in the work environment within the organization. Customs and unique rules that have been cultivated as tacit understanding among employees can be said to be a kind of organizational culture. If the values and perceptions of employees are in agreement, work can be carried out with the minimum amount of interaction required, making it easier to make decisions smoothly. If the efficiency of work increases, the performance of the organization will also improve.
To foster a good organizational culture, it is important to evaluate the current situation according to the checkpoints that are considered to be the elements of a desirable organizational culture. There are many points to check, but for example, the following points are important.
- Is the corporate vision clear and well-known to employees?
- Are voices from the field reaching management?
- Is there good communication within the organization and is there active communication between departments?
- Does each employee understand and practice the norms and behaviors necessary for organizational goals?
- Is each employee telling their true feelings?
- Is the communication line (communication system) necessary for the above implementation secured?
Differences between organizational culture and corporate culture
Words similar to organizational culture include “organizational culture” and “corporate culture.” Make sure you understand the difference between them.
Organizational culture is the shared values and beliefs within an organization that extend beyond the attributes of individual employees. Organizational culture is greatly influenced by the criteria for managing the entire organization, such as management principles and work regulations. On the other hand, organizational culture is influenced by factors such as results-based or seniority-based, top-down or bottom-up, upward-oriented or stable-oriented, and is also related to the work and motivation of employees.
However, the two are not distinguished, and some of the influencing factors overlap. Another difference is that the organizational culture is naturally rooted within the organization, and reform is more difficult than an organizational culture that is easily changed by external influences.
Corporate culture is the atmosphere and values of a company that employees feel, and it is characterized by many sensory elements such as “cheerful and friendly” and “tense”. Because it cannot be visualized as information or numbers, it is difficult to communicate before joining the company, and it is often cited as a reason for employees to leave early.
Elements that make up organizational culture
Organizational culture is mainly composed of two elements: soft and hard aspects. In this section, specific examples of each are given and their characteristics are explained.
The “soft elements” that make up the organizational culture are made up of the awareness, behavior, values, and human relationships of each employee. Examples of soft elements include management style, teamwork, hierarchy, trust, motivation, employee engagement, and local rules within an organization.
It comes to the surface in the form of “I will be seated 10 minutes before the start time” and “If someone is busy, I will help them. is not done. Invisibility is a characteristic of soft elements, and reforms require changes in the awareness and behavior of employees themselves.
The “hard elements” that make up the organizational culture refer to the values, organizational structure, and systems that are clearly stated in the organization, and serve as the basis for decision-making in organizational management. It is a tangible element, and it can bring about major changes through proactive efforts by management. Specific examples of hard elements include corporate visions and missions, corporate governance, medium-term management plans, personnel evaluation systems, credos, and compliance rules.
Advantages of fostering a good organizational culture
Fostering a good organizational culture brings various benefits to organizational management. The main benefits include shared corporate vision, improved employee engagement, and reduced turnover.
First of all, by presenting the company’s vision and mission, which are the hard elements of the organizational culture, and making sure that employees are aware of them, the company and employees can align their goals. This will increase the productivity of operations and increase the effectiveness of business plans aimed at by management.
Next, fostering a good organizational culture contributes to building a work environment with good human relations. Employees will be able to feel attached to and proud of their company, and you can expect an improvement in employee engagement. People with high employee engagement are highly motivated to contribute to their company and feel that their work is rewarding, so it will also be effective in preventing turnover. Since such human resources want to introduce their company to others, there is also the possibility of hiring referrals by recommending acquaintances and friends who match their company.
Background of calls for reform of organizational culture
There are three main reasons behind the need to change the organizational culture.
First, the world is entering the VUCA era. The VUCA era means an era of rapid change, complex and difficult prospects, and many unpredictable events. What companies need to survive and continue to grow in such an era is an organization and employees who are not afraid of challenges and evolution, and reform of the organizational culture is called for.
Second, the collapse of the lifetime employment system has led to an increase in the mobility of human resources. I have to say that it is becoming difficult to retain excellent employees based on the company’s name recognition and treatment alone. To retain human resources, it is necessary to review the organizational culture so that the company and employees can interact with each other, rather than the conventional unilateral management of employees by the company.
The third is that while the working population is declining, work styles themselves are diversifying due to work style reforms and the spread of telecommuting. There is also a change in the values of work, such as “I want to work while emphasizing work-life balance.” Employing and accepting diverse human resources is now one of the company’s management strategies, and it is becoming important to reform the organizational culture to match it.
Points to remember when transforming the organizational culture
When changing the organizational culture, it is important to know the issues and points to note in advance. Here are three important points to keep in mind when reforming your organizational culture.
First of all, organizational culture has been naturally established over a long period, and reform takes a corresponding amount of time. It will be necessary to work on the medium- to long-term while repeating the PDCA cycle on an annual basis.
Also, remember that it is difficult to clarify issues in organizational culture. In particular, since soft elements are invisible, it is not easy to extract elements and identify issues. However, if the issues are not sufficiently identified, the effect of the reforms will be weakened, so it is necessary to carefully identify the issues over time. Therefore, it is also a good idea to start with the hardware side, which is easy to change.
Finally, clearly define how the organizational culture should change for the future. To instill in employees an organizational culture that is different from the established one, it is important to clearly define how the organization is going to change from the current situation and why it is necessary. If the definition is ambiguous, employees will not understand the need for reform, and will inevitably feel forced to do so. The reform itself will not proceed smoothly.
As the environment surrounding companies changes dramatically, it is necessary to review the organizational culture to match the times. To reform the organizational culture, both the proactive approach of management and the understanding of employees are essential. Based on the points introduced in this article, draw a picture of what your company should aim for, and let the entire company work together to advance reforms.