21 The Most Common Categories of Organizational Culture

Co-Authors: SUHANA BINTI SUHARTO (BB21110434), MASLINA ABDULLAH (BB21110603), MICK FOLLEY RAIPUL (BB21110178), KHAIRUNISA HANIS BINTI ABDUL KAHAR (BB21110219), NUR SYAFAWANI BINTI ZULKIPLI (BB21110449)

(“What Are The 4 Types Of Organizational Culture?” is licensed under CC BY-SA 4.0)

Organizational Culture is one of the most significant subjects in organizational behavior which has been studied and defined variously (Ahmady et al., 2016). OC is typically defined as a set of assumptions, symbols, organizational beliefs, routines, shared language, and myths; it appears in the way people behave and making sense (Lee J.-C. et al., 2016; Alam, 2019). Additionally, OC is intrinsically linked to all facets of an organization’s functioning, making it an ambiguous and difficult to quantify. However, some attempts have been made to address this issue. The Competing Values Framework (CVF) is a well-known measurement tool, that offers a clear definition and a consistent analytical framework of OC types. Cameron and Quinn (1999) developed their CVF that consists of four OC types (Clan, Adhocracy, Market and Hierarchy). The CVF is a well-designed instrument that is used frequently and proved to be reliable and valid in OC literature (Fong and Kwok, 2009).

Cameron and Quinn (2011) defined the Competing Values Framework (CVF) as a two-dimensional area that reflects distinct cultural types. First, the flexibility and discretion versus the stability and control axis indicate if the organization focuses on stability or change. The second-dimension deals with whether the organization is externally or internally oriented. Based on these two dimensions, CFV distinguishes four basic cultural types: Clan, Adhocracy, Hierarchy and Market, each culture type’s traits below.

Source adopted from “Exploring the Relationship Between Organizational Culture Types and Knowledge Management Processes: A Meta-Analytic Path Analysis” by Riad Aichouche, Khalil Chergui, Said Khalfa Mokhtar Brika, Mohammed El Mezher, Adam Musa, hmed Laamari is licensed under CC BY-SA 4.0

Clan Culture

This culture is prevalent in organizations characterized by teamwork and empowering people (Cameron and Quinn, 2011). In this tribal, group, and family culture, the focus is on making flexible internal organizations by engaging committed and loyal employees (Allameh et al., 2011). Furthermore, cohesion and employees satisfaction is more important within these organizations than market and financial objectives (Leal-Rodríguez et al., 2016).

Source adopted from “Exploring the Relationship Between Organizational Culture Types and Knowledge Management Processes: A Meta-Analytic Path Analysis” by Riad Aichouche, Khalil Chergui, Said Khalfa Mokhtar Brika, Mohammed El Mezher, Adam Musa, hmed Laamari is licensed under CC BY-SA 4.0

The Clan culture is similar to an extended family. It is a very personal place characterized by mentoring, teamwork, participation, and trust (Cameron and Quinn, 2006). Employees in organizations with Clan culture are more satisfied with their jobs and have more behaviors aimed at benefiting peers and companies (Lopez-Martin and Topa, 2019). Clan culture improves the satisfaction of respect needs (Zavyalova and Kucherov, 2010) and is also negatively associated with conflict (McClure, 2010). Thus, there are different characteristics in Clan culture that could have an effect of reducing suffering. The Market culture is very results-oriented. People are very competitive, and market leadership is a key (Cameron and Quinn, 2006). Workers in these organizations perceive their health as worse than average (Lopez-Martin and Topa, 2019) despite this culture creates the conditions for the satisfaction of self-affirmation needs (Zavyalova and Kucherov, 2010). Therefore, Market culture has characteristics that could increase suffering in employees. The Hierarchy culture is characterized by stability, formal rules and policies, strong focus on internal processes, efficiency, control, smooth operations, and low-cost production (Cameron and Quinn, 2006). It is associated with employee demotivation (Adler and Borys, 1996; Cameron and Quinn, 2006) and conflict (McClure, 2010). It also has a significant risk of creating human dysfunctions that harm customer involvement (Naor et al., 2008) and market orientation (Gebhardt et al., 2006). Nevertheless, if the organizational culture is oriented toward rules, it favors the satisfaction of cooperation and safety needs (Zavyalova and Kucherov, 2010), and employees report a better health status (Lopez-Martin and Topa, 2019). Therefore, the Hierarchy culture appears to have characteristics that could both increase and decrease suffering at work. In conclusion, there is a link between organizational culture and suffering at work, but, to better manage suffering, there is the need to understand, in greater depth, the extrinsic and intrinsic characteristics of each organizational culture.

Sources adopted from “Gaining a Better Understanding of the Types of Organizational Culture to Manage Suffering at Work” by Jordi Assens-Serra, Maria Boada-Cuerva, María-José Serrano-Fernández, Esteban Agulló-Tomás is licensed under CC BY-SA 4.0

Adhocracy Culture

This culture focuses on building up the organization’s ability to respond to environmental changes. The organization is externally oriented with a high level of flexibility. The main feature of this culture is the spirit of entrepreneurship and developing new products and services by ensuring unique resources (Cameron and Quinn, 2011). In this “open system model,” organizations are maneuvering successfully under ambiguity and uncertainty (Machado and Davim, 2019).

An organization that has an adhocracy culture is capable to innovate and to adapt with constant change in the external environment. Leaders are encouraging new ideas and leading through creativity (Cameron et al., 2006). According to Yu and Wu (2009), adhocracy culture could be a temporary situation when new goals emerged. Moreover, it appears in industries such as consulting, software developments, and space flights. According to Fitria and Andriani (2020), the role of the enterprise in adhocracy culture is to develop its products and services toward a leading firm in the future. Khurosani (2013) found that there is a positive and significant relationship between supporting adhocracy culture and work creativity as a moderating variable. Based on this result, Khurosani suggests that an adhocracy culture supports leaders’ and employees’ creativity and innovation through the emphasis on freedom value. Keskin et al. (2005) examined knowledge management strategy through organizational culture as an essential precursor of the knowledge management process. The study found that adhocracy culture has positive effects on tacit-oriented knowledge management strategy. Results of a study conducted by Misigo et al. (2019) revealed that adhocracy culture has a significant association with organizational performance.

Source adopted from “Exploring the Relationship Between Organizational Culture Types and Knowledge Management Processes: A Meta-Analytic Path Analysis” by Riad Aichouche, Khalil Chergui, Said Khalfa Mokhtar Brika, Mohammed El Mezher, Adam Musa, hmed Laamari is licensed under CC BY-SA 4.0

Source adopted from “The relationship between organizational culture and organizational performance” by Yasmine Muhammed Hakami is licensed under CC BY-SA 4.0

Market Culture

Market culture is a key element of organizational behavior, highlighting how a company engages with its internal and external stakeholders, handles competition, and approaches decision-making. This concept explores the importance of market culture, its various dimensions, and its impact on organizational outcomes (Denison & Mishra, 1995).

Organizations with market culture pursue stability and, at the same time, focus on external environment factors like customers, regulators and suppliers to increase productivity and profitability (Cameron and Quinn, 2011). Moreover, in this logical culture, an organization as a market seeks through openness and external focus to make various transactions to achieve a competitive edge and productivity (Allameh et al., 2011; Gomezelj et al., 2011).

Market culture is focused on competing externally to secure the largest market share and maximize profits (Cameron et al., 2006). As a corporate culture, market orientation is considered essential for achieving superior performance. This culture emphasizes productivity, goal fulfillment, performance, and achievement values, with firms aiming to achieve well-defined objectives such as financial success (Yu & Wu, 2009).

Many researchers have studied the impact of market orientation on organizational performance. Fernandes et al. (2020) found that market orientation positively affects international performance. Han et al. (1998) discovered that market-oriented firms facilitate innovation, leading to superior performance, and suggested that this strategy can be achieved through a committed organizational culture.

A study by Kharabsheh et al. (2015) identified a significant relationship between market-oriented culture and organizational performance. Additionally, Gallagher and Brown (2008) highlighted that market culture is critical for achieving superior financial performance. Ali & Gorondutse (2020) also found that market orientation is positively and significantly associated with organizational performance.

Source adopted from “Exploring the Key Components of a Thriving Market Culture” by Berhanu Correia, University of Bologna is licensed under CC BY-SA 4.0

Source adopted from “Exploring the Relationship Between Organizational Culture Types and Knowledge Management Processes: A Meta-Analytic Path Analysis” by Riad Aichouche, Khalil Chergui, Said Khalfa Mokhtar Brika, Mohammed El Mezher, Adam Musa, hmed Laamari is licensed under CC BY-SA 4.0

Source adopted from “The relationship between organizational culture and organizational performance” by Yasmine Muhammed Hakami, King Faisal University is licensed under CC BY-SA 4.0

Hierarchy Culture

“Four most common categories of organizational culture “ by Jordi Assens-Serra, Maria Boada-Cuerva, María-José Serrano-Fernández, Esteban Agulló-Tomás, Gaining a Better Understanding of the Types of Organizational Culture to Manage Suffering at Work is licensed under CC BY-SA 4.0

This culture type is characterized by concentration, formal rules and the features of the bureaucratic organization. The procedures and policies are well-coordinated and governed (Cameron and Quinn, 2011). Hierarchy culture or “internal process model” is establishing internal stability and organization control, while the business environment is generally stable and anticipated (Machado and Davim, 2019).

In a hierarchy culture, leaders function as coordinators who strive for efficiency through uniformity and timeliness. Organizations with this culture are characterized by high levels of control, where leaders are highly coordinated and organized. The primary objective is operational effectiveness at all levels (Cameron et al., 2006). Standardization, strict control, and well-defined tasks are key elements of the hierarchy culture (Yu & Wu, 2009).

Naranjo-Valencia et al. (2011) found that firms with a hierarchy culture often emulate key market players. Prajogo and McDermott (2011) concluded that a hierarchy culture contributes to improved product quality due to its high level of control. Calciolari and Lega (2018) associated hierarchy culture with better performance and increased competitiveness. Additionally, Sanner and Bunderson (2018) noted that a growing body of research indicates that an appropriate hierarchy structure fosters employee creativity and learning.

Source adopted from “Exploring the Relationship Between Organizational Culture Types and Knowledge Management Processes: A Meta-Analytic Path Analysis” by Riad Aichouche, Khalil Chergui, Said Khalfa Mokhtar Brika, Mohammed El Mezher, Adam Musa, hmed Laamari is licensed under CC BY-SA 4.0

Source adopted from “The relationship between organizational culture and organizational performance” by Yasmine Muhammed Hakami, King Faisal University is licensed under CC BY-SA 4.0