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Corporate Culture

What is corporate culture? 

Corporate culture is made up of a set of norms, values, beliefs, and ways of acting, thinking, and feeling that the members of an organization share. Corporate culture governs the daily habits and behaviors of those who work at a company, as well as dealings with suppliers or customer service. The mission, vision, and values of each company will determine its corporate culture. 

Why is corporate culture important?

Corporate culture gives a company personality and differentiates it from others; it also gives it a system of values. Two out of every three executives say that this factor is as or more important as business strategy.

What elements make up corporate culture?

Symbology

Symbols, or heroes, are people who embody a company’s potential. They are a source of motivation for the rest and act as reference points, communicators, and leaders.

Ideology

A company’s beliefs are the ideas it has about its mission and situation in the present and future market. On the other hand, its values are the principles, norms, and models that govern the shared behavior of the organization’s members. The values contain concepts related to tolerance, respect, equal opportunities, and non-discrimination.

When we add beliefs and values, we get ideology.

Communication

Corporate culture is evident in the company’s internal and external communication – that is, how superiors communicate with employees, but also how the company communicates with its customers and suppliers, for instance. The vocabulary and linguistic personality of a company are key to sharing its corporate culture.

Structure

This has to do with individual autonomy, hierarchies, control, delegation, and participation that govern the organization’s functioning.

Identity, mission, vision, and values

These concepts are defined in developing the business model. They’re linked to the brand image and should serve to give shape to a coherent corporate culture.

Rituals

These are the set of activities, routines, and events that the company carries out at key moments. They’re essential to establish, correct, reinforce, and preserve the corporate culture. 

What types of corporate culture are there?

Authoritarian culture

Decision-making power is centralized; all processes have to be supervised by one or more people, and the capacity for workers’ development is very limited.

Bureaucratic culture

It’s based on the procedure and work methodology, which limit the employees’ freedom of action precisely. This model resists change and induces demotivation, so it may not be very effective; however, it is optimal in terms of order, control, process safety, and quality.

Objectives-based culture

This one is focused on obtaining results, which is why it encourages proactivity, participation, and competitiveness. It’s optimal for the company’s development, but it may have a negative impact on workers because it generates stress and insecurity and enhances work addiction.

Motivation culture

It’s closely related to culture by objectives. It focuses on fostering motivation on the team to increase productivity but also workplace satisfaction. Its key factors are management style and communication between senior and junior employees.

What examples of corporate culture are there?

Many companies have consolidated their image thanks to the dissemination of their business culture; here are a few examples:

Google: it encourages creativity and continuous innovation to achieve technological and virtual communication solutions. It’s also characterized by a high tolerance for risk and the flexibility of its model.

Banco Santander: it owes its prestige in part to values such as leadership, innovation, professional ethics, and dynamism, as well as solidity and confidence.

Disney: probably the strictest company in attention to detail to preserve cohesion and coherence in its corporate culture. It is also a master of loyalty.

El Corte Inglés: ethics and responsibility, customer service and assurance, the relationship and bond with its surroundings, and respect for the environment are the principles that govern its business culture.

Ferrovial: commitment to talent, integrity, safety, excellence, and innovation. Its good qualities include the work of magnificent professionals; their effort, good work, and creativity have allowed overcoming complex challenges, taking advantage of opportunities, and transforming individual ability into collective achievements.

Fun facts about corporate culture

  • A study by Crawford International and HR.com shows that the financial performance of organizations whose culture is aligned with their business goals outperforms their competitors by 200%.
  • According to an analysis of 40 multinationals, the organizations with the most committed employees recorded annual increases of 19% and 28% in their operating income and earnings per share, respectively. On the other hand, those with the lowest percentage of committed employees registered annual declines of 33% and 11%.

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