Organisational Culture

ACCA - F1   ACCOUNTANT  IN  BUSINESS

Culture is arts and other manifestations (event, action or thing that exists or is happening) of human intellectual achievement regarded collectively. It is reflected in norms, believes and behaviour. Every company has their own cultural values, which guides their performance towards goal achievement. An organisation is a group of people working together to create harmonized mechanism. This harmonized mechanism of an organisation can be simply presented by the cultural web.

Cultural web consist of seven elements. The paradigm, organisational structure, power structure, control system, rituals, symbols and stories/myths. At the heart of the cultural structure lies the organisational paradigm. It refers to the pattern of other elements over time and the shared values adopted from establishment of organisation.

Organisational structure reflects how every functional/divisional unit co-ordinate to achieve shared goal. This is closely linked to power structure. The power structure describes the discretion of key personnel that is authorised from the board. Power system is affected by control system. Power system reflects the rights of key personnel and the control system represents the responsibilities. The control mechanism can be rigid or flexible. The approach adopted connects to the discretion provided to the management.

Rituals and routines represent the way things goes in usual organisational environment. It is accompanied by the symbols. Symbol means all the symbolic element of the firm including title, logo and dress code. Lastly, stories and myths are words from the past activities of the organisation that passes form one employee to other. 

There exists different practice in the business organisation. It can be a bureaucratic, autocratic, democratic or technocratic. It gives an idea how power and control is divided between the employees.

Culture of organisation changes over time. With time, organisation shift from one paradigm to another. This is called the paradigm shift. Different elements in business environment can trigger the need to shift the paradigm. E.g. Takeover or National harmonization process.

There are different ways to view cultural dimension. They are individual or collectivism, bureaucracy or democracy, masculinity or femininity and long term or short term. Further, the place of origin of the individuals can play an important role in defining their action and cultural dimension.

ACCA article: Culture and configuration