What Is Organizational Culture?

Organizational culture — also called company culture or corporate culture — doesn’t have one settled definition. A simple way to think about it is as the collection of rituals and values that bond the members of an organization.

It’s closely linked to purpose, which is the reason your organization exists. Culture is the glue that keeps your people pulling in the same direction, especially when they’re handed something nobody planned for. It’s why employees want to get up and go to work in the morning, and why someone would want to join your company in the first place.

The three components

1. Incentives

Leadership directly influences culture by incentivizing or disincentivizing behavior:

2. Leadership behavior

The way you and your fellow executives behave is critical. You’re setting examples every day — in how you carry yourself, how you interact with people, how you speak, even how you dress.

But the most important part is how you hold yourself, and each other, accountable. Whatever you do rubs off on the rest of the organization. If you cut corners, so will your employees. If you own your mistakes, so will they.

3. Shared values

A shared understanding of what drives us — the things we agree on, the things that motivate us — is what makes culture possible. Culture is a manifestation of meaning.

It helps to write these down, and most companies attempt that with a Vision/Mission statement. Unfortunately, most of them are terrible. This isn’t your fault; it’s genuinely difficult to distill. But they tend to be full of empty words and corporate speak. If people can’t read them and think “yes, that!” then they aren’t doing the one job they exist to do.

Once people understand and agree on shared values, they shape their behavior accordingly — and they show new team members the ropes. Agreement plus consistent behavior creates culture.

So, the basic formula:

shared values + leadership behavior + incentives = culture

Why it matters

Strategy is prescriptive, and tactics even more so. Culture is different: it’s a blueprint for what “doing the right thing” means here. That’s what lets your team execute well in the situations no one wrote a playbook for. It gives them a frame for creative problem-solving inside the shared values and in support of the purpose.

That’s the real content of “culture eats strategy for breakfast,” the line usually attributed to Peter Drucker.

Where the Point of View comes in

We use category design to turn clients into market leaders — often during a rebrand or a pivot. One component of that work is understanding and articulating the organization’s culture in its Point of View, or POV.

We begin with fact-finding interviews, and those learnings inform the workshops and discussions that follow. But along the way we always craft the POV: a document that outlines the shared values, the motivations, and the goals that drive the company, its leaders, and its team members. We go a step further and describe how the world looks in success — when the client’s product is in customers’ hands and improving their lives or their work.

It’s a highly interactive process with several rounds of revision, and it’s without fail one of the things clients end up valuing most about the work, aside from the commercial results. POVs can even become the basis for a full whole-company strategy review.

It also helps with hiring and retention. A well-crafted POV contains the shared values that form the basis of culture, and it gives a hopeful, specific picture of the future. In short: it articulates why a current employee wants to get up and go to work, why the things they do matter, and why a prospective employee would want to join.

If any of this sounds like the problem you’re currently sitting with, let’s find out whether we’re the right fit.