Does cultural alignment equal increased organisational performance?

At this point you may be wondering what a highly creative “1 + 1 = 3” advertising campaign for Schweppes has anything to do with the title of this piece. Most likely, your eyes were drawn to the image and then your brain tried to make some sort of semantic connection between these two disparate elements. *PLEASE DO NOT STOP READING* I realise that I may have lost some of you, but in this article I will attempt to explain how this mathematical improbability is a synonym for organisational culture.

Organisational culture could be best described as the proverbial corporate yoyo; it keeps coming back into fashion and dropping out of vogue again and again. While some stress its criticality, others are more cautious about the utility of organisational culture. The biggest culprit behind this indecision has been the fact that organisational culture as a corporate characteristic has largely remained an enigma. Organisational culture by its very nature is very difficult to define, represents different things to different organisations, becomes all encompassing, is quite often misunderstood, at times abused and, as a result, underemphasised or put into the ‘too hard basket’. Despite these challenges the pendulum has recently swung back in favour of organisational culture as companies have started utilising more prudent cultural interventions and building organisational capacity around this construct.

A very useful definition of organisational culture was provided by perhaps the single most influential figure in this area, Edgar Schein. Schein emphasised that organisational culture was comprised of three components: artefacts, values, and assumptions. Although some aspects of this definition do not lend themselves to practical business applications, organisations are able to recruit employees who are culturally aligned with the types of value based elements the organisation provides. “So what? Why are values even important? How do we measure them?” I hear you say.

The simplest way to answer these questions is to draw inspiration from a sporting analogy. That is, how is it possible that the underdog team is able to beat the in-form glamour side full of world class athletes? Or that a team full of world class players (e.g. Sydney City Roosters NRL wooden spooners in 2009) self capitulate or are unable to play together? These questions are highly relevant, and the parallels between sporting teams and organisations are appropriate as the two are not too dissimilar in many respects. They are both comprised of a highly diverse group of individuals with different levels of responsibility and roles aiming to achieve a similar goal or outcome.

So with this in mind, I come back to my earlier point of 1 + 1 = 3. Is it enough to have the best staff (1), and (+) the best processes, structures, resources (1) to achieve (=) an extraordinary outcome (3)? In my opinion, definitely not! Sure it helps to have these elements and most would argue that they are essential in assisting an organisation to achieve competitive functioning. However, in order to push the envelope and stand at the edge of innovation an organisation needs a positive culture. A culture that is founded on a strong values match between where the organisation is heading, what it is currently providing and what its employees desire. Sporting teams refer to this elusive ingredient as ‘team chemistry’.

The value of cultural alignment is not only demonstrated on the sporting field but in many other different arenas. For example, the construction industry has demonstrated that just hiring the best is not enough. Recently emerging commercial arrangements founded purely on cultural mechanisms (e.g. alliances) have typically outperformed more traditional arrangements. That is, traditional approaches that espouse more competitive ideologies are significantly outperformed in terms of output, quality of work, timeliness and level of innovation. On a very basic level this makes intuitive sense as you could have an organisation full of world class practitioners but if they are not culturally aligned with the organisation they would resemble a highly conditioned sled dog team pulling in different directions. While some level of internal conflict is healthy to keep the organisation from becoming stagnant, a lack of coherence, common purpose and shared values is detrimental to organisational performance.

More concretely, a recent investigation of financial data from more than 150 high performing publicly-traded Australian companies analysed the top ranking organisations to determine what enabled them to “out-produce” their peers. The report highlighted an interesting trend existing across Australia’s most productive companies: they all identified cultural fit as the key contributor to their success. In fact, the best performing organisations clearly articulated the attributes of people who would integrate well with their culture and used this information to support their hiring decisions, even when it meant excluding a seemingly ideal candidate.

A number of valid cultural fit measurement tools exist in the market and can be consistently linked to decreased levels of employee turnover and heightened levels of organisational commitment. In most cases, these tools ask candidates about the values or cultural aspects they desire at work. The candidates are then matched against an organisational profile and a level of match or ‘cultural fit’ is then calculated. In essence, using a measure of cultural fit enables organisations to not only to recruit the best candidates but also those who will be more satisfied with their work environment, more committed, and more integrated with the organisation. All of these factors equate to improved performance.

In conclusion, paying more attention to historically less emphasised candidate characteristics such as cultural fit will not only increase productivity, cohesion and employee satisfaction, but it will also provide organisations with that innovative spark and resilience to face obstacles and challenges with a united front.

This is why, in my opinion, 1 + 1 can equal 3 and the missing ingredient is something that is quantifiable and measurable. The missing link that empowers organisations to achieve extraordinary results is the intimate cultural alignment that exists between the staff and the organisation. Do you agree?

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Comment by Rickie Long on March 15, 2012 at 12:23pm

I believe that the cultural fit of a job is an important component of job satisfaction. You make an interesting connection that it may be the 'third ingredient' in company success.

Comment by Salih Mujcic on March 15, 2012 at 7:36pm

Hi Rickie,

I'm a strong believer in this, and its one of those things that you simply feel in a workplace or a winning team.


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