The 9 Types of Company Culture

The 9 Types of Company Culture

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When deciding whether to take a new job or stay in your current position, there are numerous factors to consider. Of course, there’s salary, location, and the opportunity to progress in your career, but you should also take into account types of company culture at the organizations you’re considering.

Types of Company Culture

Defining company culture is one of the best ways to figure out what it would be like to work at a particular organization. There are nine main types of company culture.

1. Clan or Collaborative Culture

A company with a clan or collaborative culture feels like a family. All the employees know each other and consider their coworkers friends. They also tend to have many interests in common and share a similar worldview.

Employees at a company with a clan culture tend to stay with the organization for a long time. As a result, workplace traditions crop up. Customers are also loyal and partnerships last.

In a collaborative culture, teamwork is more common than individual projects. Those with more experience (and not just those in management) mentor new workers to help them progress and reach their full potential. Everyone is valued equally, given the chance to participate, and has the opportunity to provide feedback. There tends to be a more horizontal structure without many layers of management.

Employees often enjoy working at a company with a clan culture, which leads to great customer service and high productivity. However, this kind of climate is better suited to small companies than midsize to large businesses. As companies expand, it is more challenging to maintain such a close-knit feel — and trying to may even lead to confusion.

Other problems businesses with a collaborative culture face include poor growth due to putting employees’ needs above the business and a difficulty thinking outside the box.

2. Purpose Culture

In a purpose culture, employees strive to achieve a goal for greater good. This goal could be related to sustainability, the environment, or human rights. Whereas it is common for nonprofits to have a purpose culture, for-profit companies with deep values may also fall into this category.

Employees at a company with purpose culture are driven by a higher cause than personal accomplishments. Throughout the company, workers share similar values and want to make a difference in the world. Like with clan culture, this may pose the problem of groupthink, which can stifle innovation.

3. Hierarchy or Control Culture

Traditional organizations, particularly large organizations, tend to be hierarchical, which is also called control culture. Management is made up of various levels and there is a clear difference between employees and leaders.

Decisions at a company with hierarchy culture are made at the top. Decision-making is a careful process with great consideration to details and involves looking at what worked before to minimize risk. In fact, there is an emphasis on planning and evaluation in all business activities. These characteristics make a hierarchy culture ideal for industries where safety or security is of utmost importance.

Many employees like a control culture for the clarity it brings. For instance, all they need to do is adhere to rules, follow procedures, and meet their responsibilities to eventually receive a promotion. Managers also like leading in a control culture because the workforce is efficient and productive.

There is a downside to this reliability, though: companies are less dynamic than those with some other types of cultures. This makes a hierarchy culture unsuitable for industries where innovation is paramount.

4. Adhocracy or Creative Culture

Derived from “ad hoc,” an adhocracy is the most creative type of culture. Everyone is expected to be an innovator and should be experimenting constantly with new ideas. Such a culture is useful in industries where taking risks can have huge payoffs, such as in tech or disruptive industries.

Adhocracy cultures put an emphasis on company growth and on bringing new products or services to the market fast. Businesses, and even the offerings themselves, are always changing. Employees are forward thinking and willing to fail. Perfection and following the rules is less important than learning from mistakes and adapting.

Businesses with a creative culture have the opportunity to see great profit margins — but there’s also the chance that their products (or even the entire enterprise) will fail completely. Another disadvantage is that the atmosphere can become highly competitive. Whereas some workers enjoy being challenged, others find the pressure stressful.

5. Market or Compete Culture

An even more competitive climate is a market culture, also called a compete culture. The aim of businesses with this type of company culture is to dominate the market. Leadership measures success according to return on investment and market share rather than the achievements of any individual. All decisions are based on what will bring the business closer to meeting these two goals.

Market culture is one of the most intentional types of company culture. It is unlikely for such a culture to arise by accident, as it requires that everyone be committed to ensuring consistent quality in products and services. Plus, employees tend to be incentivized with large bonuses and other monetary rewards.

Since businesses with market culture tend to attract competitive employees, it is common for workers to be high performers and strive to be the best among their coworkers. It also helps that there is a hierarchy (although with fewer layers than in a control culture), which creates an incentive to work hard to gain a management position. Nonetheless, some people find that basing their success purely on money is unfulfilling and work may become less meaningful over time.

Another difference from control culture is that market culture is dynamic. If adapting will likely help the company reach its targets, the change will take place immediately. Compete culture is less risk averse than control culture.

6. Strong Leadership Culture

A strong leadership culture emphasizes the importance of solid leadership and a commitment to helping employees to progress. In such companies, there are plenty of opportunities for training and coaching from the many mentors. Managers often take the initiative to invest in the subordinates they feel have the greatest potential, putting them on the fast track for a higher position in the company.

There is no need for many layers of hierarchy to build a strong leadership culture. What matters is that workers have the opportunity to develop their leadership skills and progress in their careers.

7. Customer-First Culture

A customer-first culture is another type of culture where personal accomplishments are less important than a higher goal — in this case, the higher goal is satisfying customers. It’s possible to have a culture that puts customers first even when a large percentage of employees never communicate directly with customers. What matters is everyone works with the goal to provide customers with the best service in the industry.

Employees at a business with a customer-first culture are always thinking about how customers will interact with their products. They monitor what users say about the company on social media and in reviews. They often have 24/7 support phone numbers and they respond to messages immediately. Surveys asking clients what the company could be doing better are also common.

8. Role-Based Culture

In role-based culture, employees lead projects due expertise rather than position. Companies place little weight whether someone is a manager or subordinate.

To thrive in a role-based culture, it is necessary to have a finely-tuned skill set. Each employee is the only person able to do her job at the company and may even be among the best in her field. This culture is appealing for the high wages it brings and the emphasis on excellence. Unfortunately, it is difficult to enter such a culture, as you need years of experience and demonstrable skills, rather than just qualifications.

9. Task-Oriented Culture

In some ways, task-oriented culture is the opposite of role-based culture. For instance, every day is completely different in a task-oriented culture. Team members hold meetings to figure out what needs doing and then assign tasks according to the skills of each employee, rather than job title. The one similarity is that, again, hierarchy has little (if any) importance.

This type of company culture is particularly common in startups, where a few members of staff need to take on a variety of responsibilities. To land a job in such a company, you need to demonstrate a good knowledge of the industry as a whole and the capability to carry out a variety of work.

How to Choose the Right Company Culture for You

Now that you’re aware of the different types of company culture, all that’s left is to figure out which would be right for you.

Think back over the companies you’ve worked for in the past. Where did you feel most at home? Do you like an atmosphere of support or do you prefer to compete? Are you more comfortable in a clear hierarchy or do you think it’s important that everyone’s voice be heard? Are you more driven by personal accomplishments or a higher goal? Answering these questions will help you figure out the right culture for you.

It’s equally important for business owners to understand the different types of company cultures. You can use this knowledge to create the kind of culture that best fits your ideals, suits your team’s working styles, and brings you closer to your goals for the future. In addition, if your business has changed since it formed, it’s worth reassessing if you still have the right culture or if it may be time for a transition.

One more thing you should do as a business owner to ensure success is consider current small business trends. Check out our blog post to find some trends that will help you thrive.

Laura Holton

Laura is a professional writer specializing in content aimed at small businesses and entrepreneurs. She has helped countless startups find the information they needed to take their ventures to the next level.

Laura Holton

Laura is a professional writer specializing in content aimed at small businesses and entrepreneurs. She has helped countless startups find the information they needed to take their ventures to the next level.


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