Organisational Culture: Strong v Weak
If culture is like the DNA of an organisation, then you can argue that the culture of every organisation is unique. However, it is still possible to group certain styles or types of organisational culture. By doing, students are provided with an opportunity to compare and contrast - a vital exam skill!Let's look at an obvious basis for comparison - strong versus weak culture.
A strong culture is one which is deeply embedded into the ways a business or organisation does things. With a strong culture, employees and management understand what is required of them and they will try to act in accordance with the core values.
A key benefit of a strong culture is that there is less need for detailed policies and procedures because the "way things are done around here" is well understood and accepted.
There are many great examples of organisations with strong cultures. Indeed, as we have argued in this blog, organisations built on a clearly defined set of core values, consistently applied, use their strong culture as a source of competitive advantage.
Three of my favourite examples of strong culture are Southwest Airlines (founder Herb Kelleher's strategy of an employee-centric culture); Ikea (founder Ingvar Kamprad's culture of thrift and teamwork) and Disney Theme Parks (where customers are "guests", a job is a "part" and a uniform is a "costume"). In each of these businesses the culture is an intrinsic, core part of the strategy. Actually you might argue that for organisations like Ikea and Southwest Airlines, the culture IS the strategy.
There are plenty of other great examples, including John Lewis Partnership, IBM, Marriott Hotels and Zappos. You could add to those McDonalds, Starbucks, Goldman Sachs, HP and Nordstrom - and a host of other successful businesses built on a strong, distinctive culture. You can even argue that an entire industry sector enjoys the advantages of strong culture - namely the Mittelstand companies in Germany!
Compare the examples above with organisations whose culture is weak. A weak culture can arise when the core values are not clearly defined, communicated or widely accepted by those working for the organisation. It can also occur if there is little alignment between the way things are done and the espoused values. This can lead to inconsistent behaviour of people in the organisation which in turn results in inconsistent customer experiences!
A key consequence of weak culture is that there is greater need for procedures, policies and bureaucracy in order to get things done in the desired way, with in turn can add substantially to organisational costs.
Can you think of some examples of weak culture? A good place to look is in businesses or organisations that are struggling to compete or perform. Think about your own personal experiences of poor customer service or unacceptable quality - there is likely to be some evidence of weak or dysfunctional culture.
For me, an organisation like the HMRC is a prime example: poorly managed; highly inconsistent levels of service and a largely demotivated workforce. Also, do you agree with me that the terrible service you get at Burger King compared with McDonalds is an indicator of a weak culture? No-one working there really seems to care how long it takes to serve your order. What about Tesco? I stopped shopping there long ago after becoming fed up with disinterested staff and longer queues. Tesco might enjoy the benefits of enormous scale, but is culture can't hold a candle to that of John Lewis Partnership.
Strong culture versus weak culture: a key comparison for students to make. But, is strong culture always better than weak culture? It may depend!
Some research by Sorenson (2002) looked into the relationship between the strength of culture and business performance. The research found that strong cultures were best able to deliver a successful strategy in fairly stable operating conditions. However, when the market or economy became more unstable or volatile, businesses with strong cultures were less successful. Sorenson suggested this might be because an organisation with a strong culture might be less likely to react to the need to change; i.e. they could be less adaptable in a rapidly-changing environment.
You might also argue that a culture can be strong but that a strong culture leads to business problems – even failure. There is little doubt that the corporate culture at Enron was toxic – but it was also strong. Employees knew exactly what was expected of them – it’s just that what they were required to do was usually unethical and/or illegal! Similarly, the original culture at Nokia and Sony was strong, but did the entrenched culture get in the way of those businesses responding to rapid change in the external environment?
However, I suspect that the top-performing businesses, particularly those that have sustained high performance over many years, much can be attributed to the strength of the corporate culture.