Full version Types Of Culture

Types Of Culture

This print version free essay Types Of Culture.

Category: Philosophy

Autor: reviewessays 03 January 2011

Words: 3649 | Pages: 15

The Clan Culture

As Cameron and Quinn describe each culture in great depth in the context of for-profit companies, this paper will summarize the cultures and apply them to the foundation setting. Starting from the top left box of the quadrant, the Clan culture is one that is similar to a family-run organization. The culture is marked by “shared values and goals, cohesion, participativeness, individuality, and a sense of we-ness” (Cameron & Quinn, 1999, p. 36). One would find a great deal of teamwork in these organizations, and a significant commitment to foster inclusion and having everyone’s voice heard. This culture might sound very appealing to foundation management. It might mirror the foundation’s values of inclusion and humility at every level. A Clan culture reflects a high value placed on flexibility and a strong internal focus. However, a foundation that finds itself squarely in this category might be failing to learn from communities and other stakeholders.

Clan cultures are more successful when the business environment is largely stable. For example, a company that intends on providing the same service year after year does not need to consult with its consumers on a daily basis. What it needs to do is reduce its labor and training costs. A Clan culture will do this, as employees are likely to take lower pay and stay around longer if they are receiving the emotional and social support that a Clan culture provides. A foundation must be internally focused enough to provide a level of participation among staff and to mirror its values of inclusiveness, but this focus must be counterbalanced by a commitment to also be outwardly focused and learn lessons that only community members and other external stakeholders can offer.

The Adhocracy Culture

The Adhocracy culture is one that values innovation, creativity, entrepreneurship, and adaptability. Companies that succeed within the Adhocracy model are those that must change direction with little warning, rely on individual risk taking, and exist in a very dynamic environment. Cameron and Quinn offer examples such as aerospace, software development, think-tank consulting, and filmmaking. Effective management in this type of organization requires the ability to transform the stress that often accompanies uncertainty into a love for creativity and surprise. Individuals who succeed in these environments are those who are more concerned with being innovative than in being successful every time.

The Adhocracy culture would, from the outset, seem like a perfect fit for a foundation. While it is true that a foundation that functions with this type of culture may be very successful in spearheading innovative initiatives that create long-term change, foundation managers might want to pay attention to several potential pitfalls that this culture will create, namely the fact that innovative, long-time-horizon interventions might be more motivating to senior management than it is to rank-and-file staff members, and the fact that innovative practices might not align with the values originally envisioned by the grantor or the converting non-profit.

The Adhocracy Culture might motivate foundation management who are looking to the long-term, but it will not motivate the staff members who are working in a charitable environment because they are looking for the rewarding experience of being of service to individuals. While it could be argued that these types of workers should find employment in a public charity that provides direct service, management should not discount the large numbers of employees who are interested in creating societal solutions, and want to experience what if feels like to see the benefits immediately. While foundation staff should encourage the innovation that an Adhocracy requires, it must also realize that it will need to provide short-term “wins” for employees.

The Adhocracy model would most likely be very attractive to foundation managers, and the foundation that is committed to meeting the changing needs of the external environment would be well suited to this type of culture. However, foundations must balance this desire to be totally responsive and innovative with a sense of responsibility to the foundation’s original grantor and the community stakeholders. For example, while innovation should be the domain of foundations, they cannot responsibly bet large amounts of their corpus on a new, but unproven intervention style. Furthermore, conversion foundations, which are charged with spending money collected from the community (as opposed to a benevolent individual), must be particularly careful to earn and keep the trust of the community and regulators.

The potential for government intervention and regulation must be taken into consideration when a conversion foundation decides what type of culture it wants, and an Adhocracy culture, with its emphasis on risk taking and innovation, might support overly risky practices and invite government scrutiny. As stated earlier, the conversion foundation trend is very young. As such, laws regulating conversion foundations have not been completely formulated and are inconsistent throughout the United States. There have been many calls by community members and the health care industry to create regulations that protect the community resources provided by the converting non-profit (The Aspen Institute, 2000). A listing of the efforts aimed at regulating conversion foundations would be extensive and beyond the scope of this paper. In summary, these efforts have attempted to preserve the non-profit’s benefit to the community after the conversion occurs. This preservation might take the form of requiring that the foundation provide the same charity services that the non-profit provided (e.g., free medical care or reduced-rate insurance). While conversion foundations have been allowed to explore more preventive strategies than the converting non-profit entity might have, the grant making provided by the conversion foundation should be reminiscent of the services provided by the converting non-profit, in order to avoid alienating community members and drawing the ire of government regulators. As such, management of conversion foundations must balance its advocacy, its support of nontraditional methods, and its efforts toward creating systemic change with a reliance on proven interventions, in an attempt at maintaining the community benefits of the converting foundation.

As one will see, it is not beneficial for a foundation to exist solely within any one of these cultures. While the Adhocracy culture has a great deal to offer foundations, it must be counterbalanced with a sense of conservatism and the understanding that foundation staff members are often motivated more by being part of a charitable organization than an innovative organization.

The Hierarchy Culture

The Hierarchy culture values efficiency, reliability, and fast production. Very little discretion is provided to staff, as all activities are governed by a vast set of rules. Successful managers in this environment know how to keep the organization running smoothly, with few surprises. According to the Competing Values Framework, the Hierarchy model results from value being placed on stability and an internal focus. In the for-profit world, companies that succeed with this culture are those with a stable product offering, and in which a complex set of rules has eliminated the need for staff creativity and input.

Of the four cultures, the Hierarchy model appears to be the least appealing for foundations. That, however, is not to say that there is nothing in the model that foundation managers can use. The day-to-day workings of a foundation are not always revolutionary or even charitable. With the very strict IRS regulations of a foundation (and the above-mentioned oversight by community members and government regulators), it is important that staff members respect rules and know how to exist within a highly regulated environment. In addition, as many different individuals within a foundation will often be involved in the grant-review process, it makes sense for management to pay close attention to the efficiencies that can lead to better uses of staff time and the redirecting of administrative costs to funds available for grant making. Foundation staff would be well advised to use some of the characteristics of the Hierarchy model to counterbalance some of the more exciting, yet risky, characteristics of the other culture types.

The Market Culture

The final culture type that Cameron and Quinn present is the Market model. For-profit companies with a Market culture are oriented outward, focusing on the needs of constituencies, and not on the needs of internal stakeholders. These companies are focused on transactions with suppliers, customers, regulators, and the like. Profitability, financial results, ability to create market niches, and secure customer bases are primary objectives of these companies (Cameron & Quinn, 1999). The hope within these organizations is that the drive to beat competitors will improve employee morale, and direct, internal attempts to make employees happy are not as valuable.

Naturally, very few foundations will be comfortable existing within this model. The Market culture is above all competitive, and foundations are not well served by trying to outdo their colleagues. However, there are some aspects of this culture that might be beneficial for foundations. At times, competitive thinking will help a foundation to find a niche in grant making that will help the foundation focus its activities, and perhaps create a deeper impact. In addition, a market orientation will spur foundations to consider grantees as customers, and rely on customer feedback to improve operations. Attempting to incorporate some characteristics of the Market culture into a foundation’s existing culture will reduce arrogance on the part of the foundation, and reorient the its focus on the stakeholders who truly matter.

In summary, the Competing Values Framework is particularly useful for grant-making institutions, as a foundation must look both at how it is meeting external needs and how it is reaching the goals that it has set internally. At the same time, foundations struggle with the need to protect their corpus and be responsible stewards of their endowments. The Competing Values Framework will allow foundation leaders to better assess what type of culture currently exists in their organizations, and in what direction they want to move.

There are many other ways to diagnose an organization’s culture. In fact, Cameron and Quinn argue that culture “comprises a complex, interrelated, comprehensive, and ambiguous set of factors. Consequently, it is impossible to ever include every relevant factor in diagnosing and assessing organizational culture” (Cameron & Quinn, 1999, p. 29). There are many ways to define culture, but perhaps Barry Phegan said it most elegantly when he wrote that culture “is history expressed in the present” (Phegan, 1996, p.3).

The Importance of Culture within a Foundation

After addressing the question “what is culture?” the next logical question is: “why is it important to a foundation?” As stated in the introduction, many management theorists have paid attention to culture in an attempt to link strong organizational cultures to improved profits. However, foundations are not interested in profits; they have a different motivation altogether. The motivations of foundations are complex, and they will vary between different organizations. However, it can safely be argued that consistency in grant making will almost always be valued, as it prevents feelings of unfairness among grant-seekers. It also follows that in order to maintain consistent standards, one must have a stable work force.

Job Satisfaction and Reduced Turnover

A strong organizational culture has been shown to increase job satisfaction, especially in nonprofit organizations, and an increase in job satisfaction will often reduce turnover. A strong organizational culture within a nonprofit will remind all the employees what exactly they are working for, what they are committed to, and how they are effective. Reminding employees that they share the same values, and that their goals are important and necessary is extremely important in a nonprofit. A report on the need of capacity building in nonprofit organizations prepared by Venture Philanthropy Partners states: “For nonprofits, culture plays an even more vital role than it does for business. The culture holds the organization together, an important reason why nonprofit employees are willing to accept relatively low pay and work so hard” (McKinsey, 2001, p. 63). It thus stands to reason that a nonprofit, mission-driven organization’s ability to maintain a steady work force relies upon its ability to show its employees that what they do is more important than high salaries.

Nonprofits know that turnover is a problem and that organizational culture can improve job satisfaction. In a report prepared by Compasspoint Nonprofit Services, 64% of polled nonprofit organizations in Northern California stated that staff turnover and position vacancy had a high or very high impact on their organization’s ability to run effectively (Peters, Fernandopulle, Masaoka, Chan, and Wolfred, 2002, p. 9). Furthermore, 39% of the organizations that are experiencing issues with turnover attempt to recruit new employees and retain current employees by emphasizing their organization’s culture (Peters et al., 2002, p. 13). While the vast majority of organizations polled in this survey were public charities and not foundations, the outcomes can be applied to foundations, as foundations are basically similar to public charities in that they are both mission-driven entities with external stakeholders. While foundations do often pay higher salaries than nonprofits (Abbot, Langer & Associates, 1999), foundations are encouraged to use their cultures to better compete with other foundations and with the for-profit sector for qualified, committed employees.

Similarly, Mitchell and Yates (2002) argue that organizational culture should be central to recruiting efforts. They urge nonprofit leaders to “focus your recruiting efforts on volunteers and paid employees whose value systems are compatible with your organizational culture. Since you probably can’t compete with for-profit companies when it comes to monetary incentives…your culture is one of your best recruiting tools. Volunteers and paid employees are most likely to join your organization if doing so will further their own personal values” (Mitchell & Yates, 2002, p. 33). As stated above, within a strong organizational culture, employees will share the same basic assumptions and strong unconscious beliefs. As potential nonprofit employees will look for organizations that match their value system, it is important for the nonprofit to have a culture that clearly lays out what its values are, and invites a new employee to share in the struggle of furthering these values. A foundation with a strong culture will keep its employees because the employees feel that their work is important and that they are working alongside like-minded individuals toward a common goal. And within the foundation setting, this consistent, reliable work force will help to create consistent grant making and reduce recruiting and training costs.

Values, not Money, Motivate

As stated earlier in this paper, there are a number of cultural signifiers in an organization, including a company’s rituals, heroes, and espoused values (Schein, 1992). However, it is this last factor, the values that the company holds, that motivates employees of non-profit organizations, and a strong organizational culture will reflect and reinforce the values of the organization.

In a recent survey commissioned by The Brookings Institution, Paul Light (2002) determined that “nonprofit employees come to work for exactly the right reasons: they are motivated primarily by the chance to accomplish something worthwhile” (p. 10). Light’s findings unequivocally show that nonprofit employees are motivated more by the feelings they experience at work than by salary. In fact, 41% of those surveyed said that they came to work for non-financial reasons, such as their interest in the job, or the spiritual rewards. Ten percent of respondents came to work to further the common good, and eleven percent came to work because of their personal work ethic. Only 23% of respondents said that they came to work every day for the money, and nearly a third of these claimed that it was a combination of money and other factors that encouraged them to show up every morning. These numbers, Light points out, contrast with responses given by federal government and private sector employees, in which 31% of the former and 47% of the latter claimed to come to work every day only for the money.

These figures should not be surprising. Most nonprofit leaders and employees know that they have chosen their career paths based on a desire to improve their communities, or society as a whole, and not to make money. In fact, Light showed that “nonprofit employees clearly understand that they could make more money elsewhere” (p. 11).

However, while many nonprofit leaders know that their employees are not motivated by money, they often forget this truth when attempting to motivate their workers. They think that low morale and inefficiency is due to the fact that the employees are receiving low salaries. These leaders then abdicate their power to make a difference, as they think they lack the financial resources to improve morale. However, a leader who fails to remind his or her employees that the employee is helping the organization meet its mission and improve the lives of underserved communities will find that his or her organization has high turnover and low job satisfaction. This, in turn, will lead to higher training costs, inconsistency, and counterproductive cynicism.

Culture Underscores a Foundation’s Beneficial Impact

In addition to simply reminding staff that they are doing important work, a manager might want to show staff the benefit of their work. The Ford Foundation has done this through its Good Neighbor Committee. This is a committee comprised of staff members of the foundation who come from the administrative, investment and grant-making divisions of the foundation. Participation is limited to those who do not normally recommend grants as part of their regular duties. The committee makes contacts with nonprofit organizations working in Midtown Manhattan, the area that surrounds the foundation’s headquarters. The committee conducts site visits, responds to grant proposals and prepares grant recommendations that are then presented to the foundation’s president for approval. The purpose of this program is to allow those in the foundation without grant-making experience to understand the role of the grant maker and better understand the grant maker’s impact (The Ford Foundation, 2000).

Grant making is a cumbersome process. As managers of large foundations know, only a small percentage of those employed by the foundation actually go out and make grants. The majority of staff members are back at headquarters managing the investments, answering the phones, planning business trips, ensuring compliance with government regulations, etc. While many of these staff members may not be completing work that looks, to the outsider, like charitable work, they are nonetheless part of a charitable enterprise, and many joined the foundation because it aligned with their values. These are employees that are looking to be involved and motivated. To not at least allow them to get a vague sense of the benefits of the organization can be seen as nothing more than hierarchical, arrogant, and ultimately, a missed opportunity.

A Strong Culture will Reduce Cynicism

However, even worse than failing to remind employees of their worth to the organization and its goals are the instances in which nonprofit organizations act in such a way that is counter to their missions. Richard Shoichet (1998) refers to this disconnect between goals and operations as the organization’s “integrity gap.” The integrity gap, according to Shoichet, “is reflected in the credibility the organization enjoys among its internal stakeholders and its consequent ability to implement strategic plans” (p. 81). Here, Shoichet is pointing out the fact that if a manager fails to align his or her organization’s internal operations with the organization’s vision, staff members will not only lose faith in management, but will consequently be less motivated to implement initiatives and meet organizational goals. As such, nonprofit leaders may find that by not perpetuating a system of values that inspires their employees, and by not adhering to these values in the workplace, the leaders have created an environment imbued with stagnation and cynicism.

Thus, it follows that the best way to ensure that nonprofit organizations retain motivated employees who are eager to work and improve the functioning of the organization, the leader must ensure that all employees are clear what the organization stands for, how each employee helps the organization meet its goals, and that the way the organization treats its internal and external stakeholders is consistent with these values. One of the best ways to show employees what the values of the organization are is to create a strong organizational culture, in which every employee knows management’s vision for the future.

Creating and managing a strong organizational culture is helpful to foundations for a variety of other reasons, other than simply motivating personnel and stabilizing the work force. For example, a strong culture is a proactive means of reducing interpersonal conflict, as all employees are taught by informal, yet effective means, what is desirable behavior and what is undesirable (Young, 2000). In addition to making the employees more effective, a strong culture will also make employees feel more fulfilled, and if a foundation is concerned with improving the human condition, it should start by improving the working conditions for employees.

There are a number of other reasons why culture is important, both in foundations and in for-profit entities. However, this section lists the reasons that a strong, adaptive organizational culture benefits a foundation specifically. In summary, a strong organizational culture is important to a foundation as: 1) it benefits the quality of life of staff; 2) it reduces turnover which results in mature teams that share values; 4) these teams will enable the foundation to make funding decisions that are seen as consistent and fair to external audiences; and 5) foundation staff with tenure and aligned values will be able to cultivate long-term relationships with grantees, and make grants that align to a long-term strategy, thus improving the impact of grants and the benefit of the foundation as a whole.