Organizational Culture: Definition and Impact

The Business Development Bank of Canada (BDC) has provided insights into the definition and significance of organizational culture. Culture is defined as the shared beliefs, values, and behaviors that shape how employees within a company work and interact with one another.

This culture affects how people experience an organization, influencing interactions for customers and suppliers alike. It is evident in company policies, such as dress codes and office hours, as well as in workspace design and employee perks. Typically, a company's leaders establish its culture.

While not always explicitly defined, organizational cultures emerge from collective beliefs, thought processes, communication, and actions. Culture dictates acceptable and unacceptable behaviors and can articulate core values and principles that guide organizational conduct.

During periods of organizational change, culture can act as either an enabler or a barrier. A culture that embraces collaboration and adaptability may facilitate change, whereas a more rigid, bureaucratic culture might resist transformation. Leadership awareness of these dynamics is crucial when guiding an organization through change.