Corporate culture is the collection of values, beliefs, ethics and attitudes that characterize an organization and guide its practices.
To some extent, an organization’s culture can be articulated in its mission statement or vision statement. Elements of corporate culture include the organization’s physical environment, human resource management practices and staff work habits. Corporate culture is also reflected in the degree of emphasis placed on various defining elements such as hierarchy, process, innovation, collaboration, competition, community involvement and social engagement.
A corporate culture that reflects the broader culture is usually more successful than one that is at odds with it. For example, in the current global culture, which values transparency, equality and communication, a secretive company with a strictly hierarchical structure is likely to have trouble recruiting and retaining workers and appealing to customers and partners.
However, some organizations create unique cultures that break from certain norms and expected best practices, a move that can define the organizations as trailblazers and help them succeed in the marketplace.
All organizations, whether they are for-profit companies or nonprofit entities or even government agencies, have a sense of self that can be called corporate culture.
Corporate culture is sometimes referred to as organizational culture or company culture.
Corporate culture is also sometimes considered to be synonymous with workplace culture. However, some experts classify workplace culture as a separate idea that specifically and narrowly describes the conditions under which employees conduct their work – what has come to be referred to, in part, as the employee experience. According to this view, workplace conditions are shaped by and ultimately reinforce the overall corporate culture.
Many organizations determine and then develop the type of corporate culture they want, formalizing it through statements of shared values and policies designed to effectuate those cultural values.
Others organizations see their culture evolve organically and by chance and circumstance over time. Such organizations, however, may end up with a poor or even toxic culture because they weren’t thoughtful or attentive about fostering a more nurturing environment.
An organization’s culture determines to a great degree the way workers behave and what they consider acceptable ways of interacting with each other as well as with business partners and customers.
An organization’s culture also greatly determines how it reacts to change, evolution and crises. It deeply impacts the organization’s ability to innovate and succeed in both the short term and the long term.