The reason culture matters in your organization

Culture matters for encouraging innovative behaviors

"Organizational culture" didn't seem to concern 20th century managers. Why is it suddenly on everyone's mind?

Culture matters for encouraging innovative behaviors
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I regularly meet with customers and partners to discuss challenges they're facing, and I've noticed something recently: When they ask for advice, they typically spend five minutes talking to me about technology—and the remaining time asking me questions about organizational culture.

Many of these folks are realizing that a healthy and innovative organizational culture isn't a "nice to have" feature of their organizations; it's fundamental to success in our fast-moving world. People are realizing that organizational culture doesn’t just boil down to the tools you use or the perks you offer. It's broader and more complicated than that.

Your organizational culture is actually the relationship between the values your organization espouses and the behaviors of the people who make it up. Understanding this relationship—and adequately investing in, monitoring, and nurturing it—is perhaps the single most important path to success today.

Defining culture

Organizational culture is the collection of values that give your organization its identity. It colors and affects everything you and your teams do. It's an unspoken and taken-for-granted set of rules determining what people in your organization think is "normal" or "natural," what is "acceptable" or "unacceptable," what is "good" and "bad"—and, by extension, what is "desirable" or "undesirable." If organizations are groups of people who've joined together to accomplish something, then organizational cultures are the collective values that keep them bound together and moving in the same direction as they do.

But organizational culture is largely invisible. It only becomes clear as a set of learned behaviors. You can glimpse it in the words people use to describe themselves and their work while they're together, in the stories about their history that they tell one another over lunch, in the ways they set and manage priorities, in the decisions they make when faced with difficult choices, and so on. Without these behaviors, culture can't really perpetuate itself. And only through these behaviors can culture really become something we can analyze.

So you can see how the relationship between values and behaviors is reciprocal: People don't act without some sense of identity, purpose, or intent, and all of these are the product of organizational culture. But organizational culture is just vague and abstract without the actions that make it visible to us—and those actions are exactly what leaders need to watch if they're at all interested in improving their organizational cultures.

That's because the alignment between value and action will tell you if you're cultivating an organizational culture capable of weathering our current environment of constant disruption.

A return to culture

Thinking this way really does require a cognitive shift. Traditional management theory views culture as a variable we "solve for" when we're building our most productive environments. Hierarchies, after all, work best when people aren't preoccupied with issues like "mission" and "purpose." Hierarchies need workers that perform rote tasks quickly, expediently, and without variation.

But today, as professor John Kotter suggests in his recent book Accelerate, hierarchies don't move quickly enough to keep organizations responsive to rapidly-changing environments. They do several things well, but, as Kotter writes, innovation isn't one of those things. Innovation isn't just another outcome of hierarchical machination. In fact, by definition, innovation is something that can't always be predicted or controlled—quite the opposite of what hierarchies are designed to achieve! So leaders everywhere are beginning to wonder how they can expect the best, most innovative behaviors from their employees without having to prescribe everything they do.

And the answer, they've found, is culture.

More specifically, they've discovered that workers today—highly-skilled and adept at using multiple channels for collecting data and analyzing problems independently—work best when they have a keen understanding of an organization's mission, purpose, and values, and then have the latitude to make what theydetermine are the best decisions in pursuit of success. Today's leaders can't expect to be able to prescribe every single behavior and decision. They have to ensure they've created an organizational culture in which people take action with the organization's values in mind, and leaders are reinforcing an organization's culture through their observable actions.

When action and values align, organizational culture works as a positive force, propelling an organization to greater innovations faster. When action and value are out of joint, the opposite happens: organizations flounder.

Here's an example. I recently attended a meeting of a company whose primary core value was safety. Safety trumps everything at this organization, and it forms the bedrock of just about every decision the company makes. When the meeting officially began, someone came into the room and explained to us, very matter-of-factly, the locations of all the emergency exits in our vicinity. "In the case of an emergency," this person said, "we'll evacuate along the following routes and we'll reconvene at this established location" (in this case, a park across the street).

No one batted an eye. Everyone found this method of initiating the meeting perfectly normal, natural, and valuable. In fact, if the meeting hadn't begun this way, I suspect people would have noticed right away and said something immediately. This company wanted safety—a core cultural value—everywhere. So it built safety—a concrete set of observable and learned behaviors—everywhere.

Compare this to organizations I know everyone has seen at least once, where leadership claims to value something but does absolutely nothing to encourage or enhance it. Values only appear in behaviors, and behaviors depend on values. When associates join your organization, they'll immediately key into the values the actions of those around them seem to express. And they'll pick them up, live them, and perpetuate them.

That's why organizational culture is so important—not just today, but always. When value and action align, great things happen. When they don't, you're in trouble.

About the author

Jim Whitehurst - Jim Whitehurst is President and Chief Executive Officer of Red Hat, the world’s leading provider of open source enterprise IT products and services. With a background in business development, finance, and global operations, Whitehurst has proven expertise in helping companies flourish—even in the most challenging economic and business environments. Since joining Red Hat in 2008, Whitehurst has grown the company, and its influence on a variety of industries, by reaching key milestones—the most...