A Research Paper By Heather Fife, Heather Fife Coach, UNITED STATES
Relationship Between Leadership and Culture
This paper explores the relationship between leadership and culture while broadly showcasing the impact of mindfulness in an organizational setting. While mindlessness in leadership can lead to an undesired culture, being mindful of how leadership can influence the organization’s values, beliefs, and vision has been shown to reduce employee turnover, inspire innovation, improve office morale, and increase corporate profit. This critical analysis will investigate different leadership theories to show the importance of value propositions, effective communication, and leadership follow through and their effects on culture to manage and achieve productivity in the workplace. They understand that there is no culture better than another culture. Culture is dependent on the values and goals of the corporation.
Leaders Build and Cultivate the Culture
Cultural norms define what is encouraged, accepted, or rejected by the organization and are a primary consideration for most employees looking for a place to work. By simply walking through an office, one can feel if the effects of culture to distinguish between a supportive and positive environment from one that is toxic and challenging. In a positive corporate culture, innovation will increase, there will be higher job satisfaction and decreased conflict. However, this ideal corporate culture is difficult to undertake, and a solid and supportive leadership team is required. Leaders build and cultivate the culture consciously and unconsciously through words, actions, and reactions to challenges that can affect the organization. The most effective leaders are aware of how their actions affect the culture and often take time to communicate the strategy and validate the execution to maximize results.
Corporate culture is not a one-size-fits-all leadership; there is a benefit to using different leadership styles. Leadership has an impact on the culture of the company can either decrease or increase profitability. Hiring talented people is difficult; when these people are looking for a job, their culture can be the tipping factor in deciding where to work. When the culture is not healthy, it creates expensive issues for corporations. Using employee retention reports, profitability, and employee surveys measuring satisfaction, support, burnout, and teamwork, we can create an analytical approach to describe how culture influences organizational effectiveness. This paper will look at the problem of failed leadership and provide research to support how leaders can turn an organization around by being aware of their company culture and the mindful development of that culture.
The Unproductive Culture Problem
An unproductive culture creates a financial and social burden on the company. Abusive supervision has been associated with employees’ role conflict, turnover, and decreased justice perceptions, commitment, and satisfaction (Lindsay et al., 2017). This type of negative managerial style (where threats instead of rewards are used to motivate) has been estimated to cost organizations in the United States $23.8 billion annually through employees’ health care costs, productivity, and absenteeism (Lindsay et al., 2017). Organizations place a great emphasis on retention because of the strategic value of intellectual capital and the costs of replacing valued employees (Podsakoff et al., 2007). The costs are attributed to lack of productivity, knowledge loss, recruiting costs, training costs, and have side effect costs such as low morale. Turnover is an expensive problem for corporations, which is why corporations are constantly looking for a solution. Decreasing turnover allows corporations to save time and money.
Not only does a poor culture result in high employee turnover, but research also shows employees have increased conflict, communication issues, and job dissatisfaction. All of which negatively impact job performance. A leader who is mindless about actions and communication can trigger negative emotions and become determining factors indicative of job dissatisfaction, intention to quit, and poor job performance (Lindsay et al., 2017). Job stress results from many different things, such as poor communication, challenges exceeding ability, low compensation, and a hostile environment that can ultimately support turnover intention.
Creating a healthy working environment and adequate compensation reduces the stress and retains employees (Lee & Jang, 2020). Accomplishing employee retention is achieved by decreasing employees’ hindrance stressors and the strain associated with challenge stressors (Podsakoff et al., 2007). To create a healthy work environment, it is essential to start at the top by evaluating the company’s leadership. It is often not the desire of the leader to create an atmosphere of distrust but the failure in his or her explicit and transparent communication that is the contributing factor in the development of a poor organizational culture. A positive communication channel is necessary to improve teamwork and execute efficient meetings (Lee Jang, 2020). Leaders at each level can motivate employee behaviors via different psychological processes (Strauss et al., 2009). Building the culture through effective and mindful leadership can save billions of dollars and increase positive morale through employee satisfaction.
The Presence of Culture
Culture is present whether it is intentional or not, and when companies are growing, leaders must be mindful enough to build an intentional culture so that the values are not lost in the process. Once the company is large enough to establish several levels of management, effective communication with the employees must be integrated to the degree to which dependence on one another exists. Once the culture is in place, it is a living, breathing part of the company that continually needs to be monitored and readjusted. Culture starts and ends with the leadership of the company. Employees are looking at the leadership to see if the values they say or what they write in the annual report are what they do and invest in (Rao & Weintraub, 2013).
The mindful creation of culture creates an intentional and goal-oriented atmosphere where the values and beliefs of the leadership are seen throughout the corporation. A culture crush atmosphere where employees are in love with the company’s culture, the bi-product can be the desire to be part of the company, make the company better, and ultimately grow the company. Creating an influential culture through effective leadership can position companies to be the leaders financially in their field. Whether people are aware of it or not they are hardwired to recognize and respond to company culture (Groysberg et al., 2018). Creating an influential culture through effective leadership can position companies to be the leaders financially in their field.
Examples of Productive Cultures
Empowering, fun, and crush-worthy cultures are well-known because people are drawn to the culture and ultimately want to work there when there are job openings. Google is known for its free lunches, fun events, and special programs. The company offers sleeping pods, rooms to brainstorm, ping pong, and random employees are sent to have lunch together to promote and build the community. Zappos grew their company on their dedication to their culture by having culture fit interviews and offering money to employees to quit if the culture fit was not right. They have ten core values, and raises are given through skills tests and increased capability. There is a budget dedicated to employee team building and culture promotion. Dutch Brothers is another excellent example of a positive culture that employees and customers feel and love. The mission is to have outstanding customer service and killer coffee. They have a “forgot wallet” option to pay for drinks. They promote their culture by having family days where employees and their families gather for food, games, and other activities. Chevron’s corporate environment is focused on the health and wellness of its employees. They have health and fitness centers on-site or offer health-club memberships. They provide massages and personal training and require breaks. A positive culture can be established in any industry and create an innovative place people want to work.
Theories: How Leaders Handle What They Expect of Their Employees
There are many leadership theories that this paper will not detail all the theories; however, it will focus on a few theories that may be relative to the growth of company culture. Expectancy theory becomes a self-fulfilling prophecy where whatever you expect from people is what you will see. In addition to teaching employees and having intrinsic and extrinsic motivation to be ethical will ultimately be on the shoulders of how leaders handle what they expect of their employees (Fudge & Schlacter, n.d.). Great man or trait theory believes leaders are born with the leadership traits such as charisma, confidence, communication skills, and social skills. The belief is that leaders are born and not made. We expect that the extent to which a leader is perceived as charismatic will affect how this leader is perceived as leader-like and selected because observers have a well-developed idea that suggests charismatic leaders are highly effective (Jacquart & Antonakis, 2015). Transformational leadership theory is where the leader focuses on producing more leaders by encouraging, inspiring, and motivating employees to initiate positive and productive change. The idea is to inspire and encourage employees to grow within the company and personally (Antonakis & House, 2014). Through any of these three theories and many others, employees will benefit from leadership. It is essential to recognize that leadership is not a one-size-fits-all. To build an influential culture, different leadership styles can be effective.
Organizational culture is based on both the larger culture of the organization as directed by the behavior and decisions of the organization’s leader (Krapfl & Kruja, 2015). We are in serious need of influential leaders to guide organizations today in the increasingly unpredictable world.
According to a global risk report, financial crises, social and political instability, and degrading environmental conditions represent but a few of the threats to be faced over the next decade (Krapfl & Kruja, 2015). Organizations need influential leaders; the leader needs to be consistent and build an atmosphere that develops creativity and ownership. Steve Jobs demanded of his staff that they achieve what seemed impossible. Despite his temper, Jobs created an influential, collaborative, and enthusiastic work culture and was widely admired (Krapfl & Kruja, 2015). A leader concerned only with organizational results regardless of how they are accomplished will inevitably hire people who will push the focus to internal variables essential, thereby producing a lowered morale and conflict (Krapfl & Kruja, 2015). In sum, leaders emerge when their behavioral repertoires coincide with the structure and features of the environment in which leadership is required (Krapfl & Kruja, 2015). As a leader, it is important to communicate and inspire people by sharing the vision of change and the organization’s goals.
Culture Through Leadership
Communicating a clear vision and mission of the organization is essential to begin building the culture. In addition to the vision and mission, there needs to be a clear value proposition. A value proposition is how the product or service is likely to be a value to the intended recipient and how the organization’s members will be benefited by providing the product or service. An example of value propositions in organizations against their competitors would be Toyota is the most reliable and will create safety for their owners, or the best designs are from Apple (Krapfl & Kruja, 2015). As companies work to lead an organization in any direction, it’s essential that the leader effectively communicates the value proposition so that it is strong.
There are three essential and sometimes neglected aspects of effective communication for leaders (Krapfl & Kruja, 2015). First, they should provide employees with the big picture of the organization and include information to help them make the best decisions as conflicts or obstacles arise (Krapfl & Kruja, 2015). Second, the communication needs to be clear and concise (Krapfl & Kruja, 2015). The most effective communication is direct and proper communication, which is critical to the overall task at hand. Third, listening is essential. The leader must hear how their message was interpreted to clear up any misunderstandings in the communication (Krapfl & Kruja, 2015). When a project is killed at Whirlpool, staff celebrate its passing with beer and champagne (Rao & Weintraub, 2013). This creates a culture of risk and innovation by the leaders believing and supporting projects whether or not they are successful. Executives at Whirlpool ascribe their success in part to the way this investment in innovation and training has changed the company’s culture (Rao & Weintraub, 2013). Whirlpool was getting killed by their competition, and when they adjusted their culture to support innovation, the company grew positively. Creating good communication allows leaders to see their vision come to fruition effectively.
As a leader, it is essential to trust employees to do their job and believe in them. Influential leaders do not limit their influence on control. They spend more time on enabling their employees. They use their position and authority to provide opportunities to grow and perform in front of more senior executives (Krapfl & Kruja, 2015). Trusting employees to know what the customers want and what would be helpful for future growth will allow companies to redefine and build with the growing world. Focusing on being inclusive and working on the “people issues” of the corporation will have the most significant power to shape the culture of innovation and create a sustainable competitive advantage (Rao & Weintraub, 2013).
Building culture as a leader, it is critical to focus on the strengths of the company. For leaders, those acts include a willingness to kill off existing products with new and better ones, to energize employees with a vivid description of the future, and to cut through red tape (Rao & Weintraub, 2013). Most executives want to fix the negatives immediately; however, it is better to focus and build on the strengths and then work on the negatives slowly (Rao & Weintraub, 2013). Foster the connection currently there and then grow the culture with the beliefs, values, and mindset that will shape the organization’s behavior, attitudes, and habits (Pun & Jaggernath-Furlonge, 2012).
As the company grows, the culture must be reinvented to accommodate more employees and the changing world. An innovative climate cultivates engagement and enthusiasm, challenges people to take risks within a safe environment, fosters learning, and encourages independent thinking (Rao & Weintraub, 2013). Apple, IBM, Procter & Gamble, 3M, and General Electric, to name a few, have reinvented themselves again and again. An innovative culture rests on the foundation of six building blocks: resources, processes, values, behavior, climate, and success (see appendix A). These building blocks are linked and valuable in working on the organizational culture (Rao & Weintraub, 2013). Building culture through leadership is an effective management tool since the culture is anchored in many unspoken behaviors, mindsets, and social patterns. Having effective leadership develop and maintain the culture allows leaders to sense when a change is needed and can influence the direction.
Types of Company Culture
The type of culture a company needs to be successful depends on the company’s goals and the industry category of the company. Shaping the company culture produces long-term attitudes and behaviors for the employees. The culture shows up in the shared behaviors, values, and assumptions, which are experienced through norms and expectations of the corporations in the unwritten rules (Groysberg et al., 2018). A company that wants to adjust its culture would benefit from an evaluation to determine the type of culture that currently exists. A company that is starting would benefit from looking at the types of culture and deciding what is important to them and making sure the cultural values do not conflict. According to Groysberg, the eight types of culture are learning, enjoyment, results, authority, safety, order, caring, and purpose. There are fundamental trade-offs in each of these types, so leadership needs to define the essential qualities to create the results needed to meet the company goals. Although each style can be beneficial, it will make a difference in a company’s competitive advantage, which is a better fit for the industry and goals. If a company values results and caring, it is difficult for the employees to choose which behavior to follow. Do they focus on individual goals, make goals at all costs, or work as a team with other employees to achieve the results needed (Groysberg et al., 2018). One effective way to look at what a company’s culture requires to be successful is to understand what is needed regarding people interactions and response to change.
Culture will be present whether it is something the leadership focuses on and grows or leaves the culture up to chance. Building a positive culture affects the employees. When the culture is positive, it creates positive relationships outside of the workplace and can affect the families and friends of the employee. There is mounting evidence that workplace culture, more so than the availability of work-family policies, is more likely to affect an employee’s ability to manage a job effectively and a family (Mennino et al., 2005). The vibe of an organization is a bi-product of the leader. The way leaders work affects the employees positively or negatively. The company culture can be loosely defined as the values of the company. Companies have often not focused enough on the harder-to-measure, people-oriented determinants of culture, the values, behaviors, and climate of the company. However, these people-oriented determinants highly reflect how a company drives priorities and makes decisions (Rao & Weintraub, 2013). Building a mindful culture allows for the priorities and decisions of the employees to be guided by the overall company objectives and goals through company social norms and attitudes.
Future Direction and Need for Research
Further research is necessary on company culture and how to integrate post-pandemic work conditions. It is crucial to define how a company can stay connected when the employees have multiple working options: working from home, socially distanced workplace, and a hybrid. Discovering how to develop and keep company culture in an atmosphere where there is no consistent working environment for employees will be necessary for company leadership. Creating work environments where people feel comfortable, safe, and productive will need adjusting as people come back to the workplace. Striking the right balance will be a necessary study to help corporations navigate through this complicated post-pandemic era.
Advantages and Disadvantages of Different Types of Culture
Different types of cultures have various advantages and disadvantages, and no culture is better than another. Several metrics can evaluate the strengths of company culture; a few of them are turnover rate, employee satisfaction, and profits which can be a great way to quantify and assess how successful the culture is. Leadership is essential to creating the type of culture that produces the results and goals of the company. Proper attention and the ability to change through leadership can create work environments where people want to work. Culture shows a companies goals through its values and beliefs and will guide employees’ activity and results.
Develop a Culture of Mindful Leadership
Building a culture through mindful leadership leads to employees who feel connected to their organization and work harder, are more engaged, and motivate others to do the same. Employee engagement affects just about every important aspect of an organization, including employee well-being, innovation, profitability, employee turnover, and more. This mindful attention to how the culture is growing and how it affects its goals will ultimately allow leadership to adjust when things are not going in the intended direction.
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