Corporate Culture and Its Key Components

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Any company may be regarded as unique due to an individual combination of its elements that constitutes its corporate culture. In general, corporate culture is defined as the collection of shared values, beliefs, standards, ethics, attitudes, and behaviors that characterize a company, guide its practices, and determine interactions between management and employees (Ferrell et al., 2019). On the one hand, corporate culture is not expressly defined  in turn, it develops organically from the traits of workers hired by the company and adopted by newcomers.

On the other hand, corporate culture is an organizations nature rooted in its structure, goals, strategies, and approaches to customers, partners, employees, and society in general (Groysberg et al., 2018). All in all, corporate culture may be regarded as a significant component of any business that may determine its success or failure.

Frequently articulated in an organizations vision or mission statement, corporate culture includes a companys physical environment, staff work habits, and human resources practices. Incorporated in organizational culture, its members share common goals, vision, habits, values, attitudes, systems, symbols, traditions, and working language in order to behave in accordance with them. In general, corporate culture is more successful when it corresponds to the broader one.

For instance, if global culture values communication, tolerance, equality, respect to individual differences, and transparency, corporate culture on the basis of authoritarianism and strict hierarchy will face multiple challenges in relation to workers recruitment and retaining, communication with partners and suppliers, and serving customers. At the same time, some companies succeed in the creation of unique corporate cultures that determine their stable growth and development.

On the basis of relationships between management and employees and attitudes to a companys performance, there are several types of corporate culture, including clan, adhocracy, market, and hierarchy culture. The clan culture is characterized by nurturing, mentoring, and a family-like atmosphere. The adhocracy culture is based on innovations, risk-taking, and a dynamic approach to business activities. The market culture is result-oriented  it values goal achievement and competition. Finally, the hierarchy culture is characterized by strict structures and control in order to ensure stability and organizational processes efficiency.

Nevertheless, regardless of the type of organizational structure, a successful one contributes to an employees satisfaction, motivation, and commitment. In a company with efficient corporate culture, a worker feels that he is a part of its team, and his skills, knowledge, experience, and opinions are considered and respected.

In addition, corporate culture may impact ethical decision-making as it implies the mix of values and beliefs on the basis of which both management and employees act. Thus, in the majority of companies, decision-making corresponds to an organizations standards and policies. In this case, if a company values the principles of ethics, ethical decisions come naturally. At the same time, corporate culture impacts the moral judgement of management, employees, and external stakeholders contributing to ethical decision-making as well.

All in all, ethical corporate culture provides multiple benefits for a companys performance as ethical decision-making attracts partners and customers  in other words, people prefer to deal with organizations who value fairness, honesty, transparency, expertise, and other ethical principles. In addition, employees demonstrate greater commitment and motivation working in a company that promote action on the basis of integrity and honesty with respect to others. In this case, profits rise while costs associated with employee turnover decrease.

References

Ferrell, O. C., Fraedrich, J., & Ferrell, L. (2019). Business ethics: Ethical decision making and cases. Cengage Learning.

Groysberg, B., Lee, J., Price, J., & Cheng, J. Y. (2018). The leaders guide to corporate culture. Harvard Business Review. Web.

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