For example, we find differences between companies that adopt a differentiation strategy and companies that pursue a cost leadership strategy.
CULTURAL CONTEXTS OF DRIVING FULL
Strategy.įor its full benefit to be realized, a culture must support the strategic goals and plans of the business. In contrast, nonprofits are far more purpose-driven, which can reinforce their commitment to a mission by aligning employee behavior around a common goal. Given the increasingly complex regulations enacted in response to the financial crisis, careful work and risk management are more critical than ever in this industry. Organizational cultures in financial services are more likely to emphasize safety. A comparison of organizations across industries reveals evidence that cultures might adapt to meet the demands of industry environments. Varying cultural attributes may be needed to address industry-specific regulations and customer needs. Such external influences are important considerations when working across borders or designing an appropriate organizational culture. Companies operating in countries with low levels of uncertainty avoidance (that is, they are open to ambiguity and future uncertainty), such as the United States and Australia, place a greater emphasis on learning, purpose, and enjoyment. (This linkage has been explored in depth by Geert Hofstede and the authors of the GLOBE study.) We find, for example, that companies operating in countries characterized by a high degree of institutional collectivism (defined as valuing equity within groups and encouraging the collective distribution of resources), such as France and Brazil, have cultures that emphasize order and safety. The values of the national and regional cultures in which a company is embedded can influence patterns of behavior within the organization. Region and industry are among the most germane external factors to keep in mind critical internal considerations include alignment with strategy, leadership, and organizational design. Leaders must simultaneously consider culture styles and key organizational and market conditions if they want their culture to help drive performance. Context matters when assessing a culture’s strategic effectiveness.
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