Culture has been likened to the air we breath: we are scarcely aware of its existence but we could not exist without it.  Culture has also been compared to a giant, fast-spinning fly-wheel: it creates vast inertial guidance in all that we do, leading us to repeat readily what has gone before with little concern for why.    

Culture comprises the values, norms, and conventions that we both absorb and recreate as part of a community of people, whether a company, work group, or religious organization.  Key components of company and work cultures are well characterized in Deal and Kennedy's Corporate Cultures, Hall and Hall's Understanding Cultural Differences, and Trice and Beyer's Cultures of Work Organizations.

When companies have built great cultures around core principles that work, as vividly described by Collins and Porras in Built to Last, they can enjoy a sustainable competitive edge.  When companies have established cultures that are inward looking, however, they can give advantage to competitors more outwardly focused on investors and customers.  Similarly, when companies have been built on cultures that emphasize longevity and loyalty, they too can may lose their starting edge to other firms that place a premium on performance and results.  

Culture can thus be both a source of sustainable advantage and a cause unshakable disadvantage.  The management challenge is to preserve the best but also rework what is less than best.  Culture is a powerful but not immutable template of behavior.  Well crafted, it can effectively align thousands of people and decisions; poorly designed, it can misalign an entire organization.  

Designing organizations that work often requires reinforcing core values while at the same time fostering a riveting cultural focus on performance.  This means that in hiring, appraising, and rewarding, proven performance is the foremost criterion.  It also means that in addressing, celebrating, and complimenting, results are always at the forefront.  An organization that does that well is the U.S. Marines, and its many devices for doing so are identified in Katzenbach and Santamaria's "Firing Up the Front Lines" and Freedman's Corps Business. 

Building a high-performance culture requires extended and consistent investment over several years, but once achieved, the built-in inertial momentum can help sustain high performance for years ahead, as seen in the remaking of the culture at British Airways from one of muddling through to that of customer focus.  InThe Market-Driven Organization, Day offers a host of generic devices for building a culture putting customers first. 

Links

Organization and Cultural Change Net Solutions Practice:  Web-based  methods for appraising and changing company cultures created by a consulting firm, ComptencySuite.  

Books and Articles

George Day, The Market-Driven Organization, New York: Free Press, 1999. 

Terrence E. Deal and Allan A. Kennedy, Corporate Cultures: The Rites and Rituals of Corporate Life.  Reading, Mass.: Addison-Wesley Pub. Co., 1982.

David H. Freedman, Corps Business: The 30 Management Principles of the U.S. Marines.  New York:  HarperBusiness, 2000. 

Edward T. Hall and Mildred Reed Hall, Understanding Cultural Differences.  New York: Intercultural Press, Inc., 1987. 

Jon R Katzenbach and Jason A. Santamaria, “Firing Up the Front Line,” Harvard Business Review, May-June, 1999, pp. 107-117.

Joanne Martin, Cultures in Organizations: Three Perspectives.  New York: Oxford University Press, 1992. 

James C. Collins and Jerry I. Porras, Built to Last : Successful Habits of Visionary Companies. New York: HarperBusiness, 1997.

Harrison M. Trice and Janice M. Beyer, The Cultures of Work Organizations. Englewood Cliffs, N.J. : Prentice Hall, 1993. 

Case Studies

"Changing the Culture at British Airways," HBS Case, 9-491-009, 1993.