Culture archetypes to steer a companies performance.
Today's IT leaders are more concerned with leadership styles, culture and employee performance than ever before. As tasks of and demands on IT become more and more complex, agile and versatile also the need to organize yourself accordingly is unavoidable. And with "organizing" I do not mean optimizing processes or defining new teams and roles. All that is necessary, but what is often forgotten - as it is regarded difficult or practically impossible - is that agility and versatility must be embedded in a company's organizational culture.
In the past IT organizations were asked to be efficient, reliable and cost effective. Today, on top of that they also must be proactive, creative, innovative and versatile. And if possible all at the same time. Obviously this is not possible as there are some fundamental conflicting aspects between these demands. These become clear when we look at IT organizations from a cultural perspective.
Cameron and Quinn have developed their so called Competing Values Framework for classifying organizational culture in four quadrants. The name already suggests, some conflicts exist between the four culture archetypes. The quadrants are formed by two axis: one for a culture's internal versus external focus, and another for the degree of flexibility and discretion versus stability and control. The four quadrants represent a specific culture type along with some typical characteristics such as leadership type, main orientation and core values.
Adhocracy culture is typically found at start-ups and companies or parts of organizations that must be innovative and agile.
Clan culture is typical found at organizations where collaboration is crucial and power is delegated to team or project leaders, or in partnerships or in family owned organizations. Take for example engineer-to-project organizations: Once a project contract is rewarded, the project team is (internally) focused on achieving the agreed project result and the project team acts as a small family. The project leader is result driven, but realizes that he needs the full commitment, flexibility and participation of his team members and engineers to reach the project milestones.
The Hierarchy culture is the most common culture in Western manufacturing industries. The focus is on efficiency and control. Tasks and processes are standardized so that stability, reliability and quality are guaranteed. The pitfall for hierarchical organizations is too much bureaucracy and demotivated people.
Market culture is typically found in area's where customers are demanding and/or competition is high. Business is transaction driven and the speed of product development is relatively low. Strategic themes are market-share, profitability and customer focus. Pitfall for market organizations is that transaction business is so demanding and people may not have time for their own personal development and as a result become obstacles in the innovation of the business.
Traditional development cycle:
Companies usually start-off as a small initiative with an very flexible and innovative culture. When company sales grows the management focus shifts towards strengthening the internal processes to ensure reliable delivery of goods and/or service to customers. Capacity must be enlarged by investment in additional resources, people and procedures. As production volumes increases quality becomes an important aspect to be controlled. And at the time competition starts to come in the picture pressure rises to produce against lowest cost and the company ends up in the hierarchy quadrant. Finally competition pulls companies into the market quadrant, although parts of their organization, for example the manufacturing organization, keep a dominant hierarchy culture.
One can see that due to today's 'digitalization' wave traditional companies try to (re-)establish a innovatie culture in parts of their organization to modernize their business and become more competitive.
Culture and cultural congruence is a driver for high performance.
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