October 4, 2011

Corporate Culture
Getting it Right
Naomi Stanford
2011 by Naomi Stanford
Adapted by permission of John Wiley & Sons, Inc.
ISBN: 978-0-470-93219-3

Introduction
In Corporate Culture, Naomi Stanford shows how a
companys culture can make or break the organization
and that getting the culture right is a fundamental part
of a successful business strategy. She beings by tracing
the history of the concept of corporate culture to the
1980s when two books, In Search of Excellence by Tom
Peters and Robert Waterman and Corporate Cultures
by Terrance Deal and Allen Kennedy, were published.
These books led to an awakening of business interest
in organization culture. Management theorists began
taking an interest in the concept and over the years
have developed a body of theory and research that
seeks to explain the role of culture in organizations.

What is Corporate Culture?

The author presents three perspectives on corporate
culture, making the point that each perspective is
incomplete and a view of corporate culture must be

drawn from a synthesis of all three:

1. The integration perspective suggests that an organization has a single culture that is clearly identifiable and potentially measurable, and that employees are committed to supporting it (or at least
going along with it).
2. The differentiation perspective sees organizations as
complex, many-faceted sets of sub-cultures within
one overarching culture, interacting to manage
their diverse and often competing interests and
objectives.
3. The fragmentation perspective emphasizes ambiguities of interpretation, irony, paradox, and irreconcilable contradictions that cross-cut, undermine,
and confuse any organization-wide or sub-culture
claims of consensus or clarity.

Business Book Summaries October 4, 2011 Copyright 2011 EBSCO Publishing Inc. All Rights Reserved

Corporate Culture

Stanford believes there is no value in taking a reductionist approach to defining corporate culture. It is not
a phenomenon that can be reduced to a meaningful
short label or a single agreed-upon definition. Corporate culture is an organizationally specific experience
felt both subjectively and individually by insiders and
outsiders. An organizations culture is not a thing
where a label suffices to describe it, nor is it a set of
discrete elements that can be easily manipulated
either separately or together. Across an organization,
there is an overarching look and feel that is expressed
differently but relatively predictably within business
units. On a day-to-day basis, employees respond to
whatever comes up within appropriate and culturally
acceptable norms.
It is helpful to think of corporate culture as analogous
to climate and weather climate reflecting the more
predictable pattern, applicable to the larger entity,
and weather being chaotic and unpredictable. People
living within a specific climate zone become familiar
with the characteristic weather patterns and respond
to the day-to-day variations in weather. An organizations culture is experienced in a similar way, and like
the climate and weather, is simultaneously shaping
and is shaped by the context. Over time it can and
does change whether by design or by default. In the
same way that people are conscious of the climate and
the weather, they are conscious of corporate culture
and make choices in relation to it. Thinking about corporate culture as analogous to climate, sub-climate,
and weather helps explain why changing the culture
is complex.
The author recommends these three approaches to
defining corporate culture:
1. Be clear about what the company stands for, what
its strategy is, and the way it practices its corporate values as events unfold.
2. Be culturally relevant in each market, adapting to
local customs and traditions as appropriate.
3. Stay alert and respond to changes in the external
culture.

Can Culture Be Measured?

Managers who are unable to describe their organizations culture yet are convinced that they need to
change or manage it often turn to quantitative orga-

Naomi Stanford

Key Concepts
Corporate culture is like both climate and
weather climate reflecting the more predictable pattern of what is expected, and weather
being the chaotic and unpredictable things that
happen day to day.
Measuring an organizations culture involves
not only qualitative and quantitative approaches
but also factoring in the interests of competing
cultures, subcultures, individuals, and groups.
There are as many external factors influencing
corporate culture as there are internal ones.
Culture matters because it is an intangible asset
that is distinctive to that organization and which
either adds or diminishes value.
The choices made in relation to operating the
business model and the consequences of these
choices influence and are influenced by the
organization culture.
Everyone in the organization is responsible for
the culture, has an ownership stake in it, and is
accountable to it.
The right organizational culture is one where
people feel they are doing meaningful work and
can make sense of it in their scheme of things.
Learning how to fit in and succeed in a corporate culture takes a carefully planned approach,
a respect for the norms and protocols of the
new organization, and the skills and attributes
required to establish and build trust with the
existing members of the organization.
g g g g

Information about the author and subject:

www.naomistanford.com
Information about this book and other business titles:
www.wiley.com
Related summaries in the BBS Library:
Built on Values
Ann Rhoades

Business Book Summaries October 4, 2011 Copyright 2011 EBSCO Publishing Inc. All Rights Reserved

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Corporate Culture

nizational surveys to help them decide what to do,

in the belief that what gets measured gets managed.
There are three ways of trying to measure the culture
of an organization:
1. Quantitatively using surveys
2. Qualitatively using interviews or focus groups
3. A combination of the two the preferred method

Naomi Stanford

financial assets and tangible assets. They are less clear

about the intangible assets such as management skills,
brand image, customer loyalty, and so on. Most would
agree that the competitive position and potential of
their enterprise rests on how well the three types of
corporate assets financial, tangible, and intangible
are managed and deployed
Although cultural characteristics vary, these ten are
common to most organizations:

There is no comprehensive
checklist of elements to look for
Despite theories, perspectives, definitions, labels and inventowhen trying to size up an organizations culture, and measuring ries that claim to measure it, culture is largely an unknown
the culture may or may not help quantity.
in the drive to change or manage
the culture. Unless there is a clearly expressed,
1. A story or stories act to reinforce (or deny) a comwell-understood, and good reason for attempting
panys vision, values, and ways of doing business
to measure the organizations culture, it is pointless
2. A purpose and a set of values intended to be instruto even consider undertaking this complex process,
mental in providing the guidance that shapes the
and the reason must always relate to business stratconduct of the company
egy and have an external perspective. Circumstances
where this kind of cultural measurement may be
3. A strategy summarizes the desired future for the
useful include:
organization
Merger or alliance opportunity

4. An attitude toward people in the workforce

Issues related to new business strategy

5. A global mindset needed to get a harmonious

interface between the national cultures and the
organizational culture

Opportunities related to growing the business

Issues related to a competitor challenge

Does Culture Matter?

The immediate answer to this question is Yes, of
course. Intuitively people know that culture matters
but they have difficulty explaining why it does. All
organizations have assets, and most managers have
no difficulty understanding that these include both

6. A relationship network concerned with identity,

aspiration, structures, and practices that serve
relational ends such as ethnicity, heritage, norms,
and beliefs
7. A digital presence an expression of the culture
and operation of the organization on its own Web
sites and on social networking sites

About the Author

8. A reputation crucial in building and sustaining

culture

Naomi Stanford has spent more than 20 years

in the field of organizational design and culture
change, working for leading companies and
consulting firms in the United States and Britain. She is the author of Organisation Design: the
Collaborative Approach and The Economist Guide
to Organisation Design.

9. A customer proposition the point where national

cultures and organizational cultures meet
10. A horizon scanning ability predicting or preparing for the future
These characteristics are present in different combinations and different strengths and are interdependent.
All organizations that care about their culture and are
truly focused on success will pay attention to these

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Corporate Culture

Naomi Stanford

ten characteristics. In different organizations, and

even in different parts of an organization, these attributes may look and feel different, and cluster and
interact in different ways. Each has a part to play but
they cannot be treated independently; they are all
contributory parts of the culture and operation of the
organizational system. Because the culture is dynamic
and continuously forming, adapting and reconfiguring in response to conditions and mediating factors,
it is impossible to quantify a level of significance for a
named characteristic.

tion. Whatever the positive attributes of the culture,

if the business model is flawed, success will prove
elusive. Conversely, if the culture is good, a flawed
business plan is much less likely to exist. Taking a
systems approach that involves knowing the business
model, making informed choices about the elements
of it, and determining how it should be operated are
good beginnings for understanding where and how
the culture is or can be connected to business success.
Even with this knowledge, there are some intervening factors that can act to disrupt any connection,
mainly deriving from the external
Treating organization culture as a management tool that can
environment. Developing a busibe quickly deployed to improve business performance will not ness model and an aligned culture
that have the attitude and aptiguarantee a successful outcome.
tude for adaptation to changing
circumstances will reinforce the
Is Culture Related to Business Success?
connection between culture and business success.
Connecting business success and culture seems to
Culture: Creation, Accountability
make intuitive sense, and many people believe that
and Responsibility
the connection is strong. However research suggests
Leaders can and do set the cultures tone and groundthat the link is not that easy to make. The choices and
work they create the culture. Edgar Schein of MIT
decisions on what specifically constitutes business
Sloan School of Management believes that the only
success must be organizationally determined, and
thing of real importance that leaders do is to create
how such choices and decisions are made depends
and manage culture. Accountability for the culture
on complex interactions among all the elements of an
defining or reinforcing the norms and expectations
organization in its operating environment. A business
is primarily the role of the CEO with the support
strategy that measures success in more dimensions
of other champions. Leadership entails painting a
than simply quarterly profit improvements and recvision of where the organization wants to go, estabognizes the value of cultural assets in contributing
lishing priorities for getting there, building the right
to business performance suggests an ability to keep
team, aligning the organization, and holding people
the organization aligned, adaptive, and healthy. Busiaccountable for results. It also requires an ability to
ness success is more than meeting quarterly earnings
communicate effectively so that everyone is on the
targets. The ability to think about and act on a broad
same page. In addition, effective leaders create culrange of success factors rather than just quarterly
tures where mistakes are acceptable. There should be
earnings is an intangible cultural asset.
a single point of accountability a person whose job
If the assumption is made that business success is the
is to define, model, and nurture the culture through
result of successful execution of a good strategy that
various rewards and sanctions and make clear to
is measured by more than financial results, the conmembers of the organization what the cultural expecnections between culture and business success may
tations are. There should also be specialists (human
become clearer. This is because this shifts the focus
resources staff, organization development consulfrom strategy formulation to strategy execution, and
tants, chief culture officers) who are responsible for
culture is all about execution how well the characstewarding, supporting, and directing the culture.
teristics comprising the culture are used, and are able
These designated stewards are constantly nudging
to facilitate value delivery.
and reinforcing an organizations culture.
The business model is the terrain of the organizaAll members of the organization should understand
Business Book Summaries October 4, 2011 Copyright 2011 EBSCO Publishing Inc. All Rights Reserved

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Corporate Culture

that everyone is responsible for the culture, has an

ownership stake in it, and is accountable to it. Owning
the culture is part of every employees role. Everyone
can and should take responsibility to fit in, meet cultural expectations, and develop the culture. Simply by
virtue of working together, each in their own way and
in line with their background and experiences, people
have an impact on the culture and it has an impact on
them. Collectively, they are the de facto owners of it.
How much they feel a sense of ownership or a pride
of ownership depends on a number of factors. Generally, where people feel encouraged or able to take
responsibility for the culture there is a greater sense
of ownership. This is one of the hallmarks of a healthy
culture.

Naomi Stanford

of society as a whole. Individuals experience culture

in very different ways, however. What is right for one
person may be wrong for another.
Given that corporate cultures should enable and
encourage good and meaningful work it is nave to
assume that this can be accomplished only in a specific type of culture or that one type of culture is right
for all organizations. Managers often discuss corporate culture in terms of polarities, with collaborative
perceived to be the right type and controlling the
wrong type. They also tend to talk about changing
their corporate culture from something to something else. One danger of such polarized thinking
is that it does not allow for the great likelihood that
there are multiple and sometimes competitive organization sub-cultures. It is normal for the overarching
cultural statement to be reflected differently in different parts of the organization.

Accountability and responsibility are not the same

thing. Accountability means an employees obligation to report progress, at the request of a third party,
on agreements and expectations.
Responsibility means owning, or Characteristics that matter greatly in one part of an organizafeeling a sense of ownership of,
tion are reflected at different strengths in different parts of the
tasks and situations for which
a person is accountable. Thus organization, but it should all stay recognizable as the same
someone takes responsibility and culture. An analogy is an apple pie: it can be made with more
is held accountable. In most orga- or less sugar, with added spice, with brown or white flour, but
nizations, the requirement to take
it is still an apple pie.
responsibility for the role they
play is an implied part of every
Labels attached to cultures, such as collaborative
employees contract with the organization. However,
or entrepreneurial are shorthand for the predomithe extent to which people feel or are able to exercise
nant and recognizable characteristics of that type of
that ownership varies from organization to organizaculture. Stanford asserts that these labels can serve
tion.
only as high-level descriptors. Cultures are not purely
one culture but rather exhibit characteristics of sevWhat Is the Right Organization Culture?
eral, partly because there are numerous sub-cultures,
The right culture is one where people share systems
each with its own characteristics. As a result, they are
of meaning and are encouraged to do high-quality,
both/and as in both open and secretive, both
engaging work within an ethical framework, and one
collaborative and competitive, both innovative and
where there are stated and demonstrated purposes
risk-averse depending on circumstances.
beyond making money. Such a culture should also
value and respect an individuals contribution and
allow for growth and development.
Research and experience suggest that most workers
aspire to do good work, defined as work that is of
high quality, socially responsible, and meaningful to
the worker. This notion of good work brings into play
the idea that the right corporate culture is one that
supports the well-being of those who work for it and

Cultural clashes are an inevitable part of corporate life

and resolving them can be difficult. They can be the
result of mergers and acquisitions, generational conflicts, national differences, or strategic or leadership
change. One way of handling these constructively
is to develop cultural fluency in the workforce. Cultural fluency is the appropriate application of respect,
empathy, flexibility, patience, interest, curiosity, open-

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Corporate Culture

ness, the willingness to suspend judgment, tolerance

for ambiguity, and a sense of humor. Cultural fluency
can be developed by taking the following six steps:
1. Appreciate the differences that culture can make.
2. Develop awareness of how cultural differences
influence ways of seeing the world.
3. Provide forums for education about different cultures.
4. Be flexible with other parties in problem-solving,
negotiations, or culture clash resolution efforts.

Naomi Stanford

the wider society in which it operates. Some changes

that corporations have had to grapple with over the
past decade are flexible information technologies,
various historical and political events, demographic
changes, the 2008 financial crisis and recession, and
increasing discussion about climate change. In these
circumstances aiming to create, change, or protect the
culture is challenging and takes time. If responded to
with foresight, sensitivity, and skill the result can be
an extraordinarily beneficial cultural transformation.

The term creating a culture is appropriately used in

relation to only two situations: a newly created com5. Recognize possible cultural differences that might
pany and the merger of two or more companies with
result in a clash.
the aim of creating a genuinely new entity as opposed
to subsuming one into the other. Even in a start-up,
6. Be willing to adapt.
the attributes, preferences, and
experiences of the founder(s) and
People have different perspectives on what taking responsifirst employees, together with the
bility for the culture is in practice. Getting a good balance
business model and the underlybetween fitting in and rocking the boat is both an individual
ing business strategy, already exist
and an organizational trade-off.
and play a part in the development
of a distinctive culture.

Can Culture be Created, Changed,

or Protected?

An organization both is and has a culture. Culture is highly mutable, flexible, and open to shaping
from many directions at once in its changing environments. It is a result of constructions continuously
debated and contested among its independent members. Organizational culture is not an entity or a thing
independent from the business strategy, or something
that can be manipulated by pulling levers. Organizations with a clearly articulated strategy that engage
and energize employees by appealing to their higher
ideals and values and rallying them around a set
of meaningful, unified goals, have the platform for
developing the shared systems of meaning and experience that create the culture. Rather than introduce
culture creation or change initiatives it is better to
look at what the business model and strategy are, the
way work is done, and the supporting infrastructures,
and use these to change the culture over time.
An organizations culture, like a societys culture,
changes continuously regardless of any formal or
informal transformation efforts. It is always responding to changes in the organizations markets and in

In the area of mergers and acquisitions, trying to consolidate two organizations that have no shared history,
systems of meaning, experiences, working patterns or
values is like trying to consolidate two nation states
into one. The due diligence associated with mergers
and acquisitions should include discussions of the
cultural fit, compatibility, and value that each culture
brings. The author suggests these nine strategies that
can help achieve a smooth merger:
Consider and assess cultural compatibility.
1. Think through how employees are likely to react
to the merger news.
2. Plan for challenges in helping people work together in new ways.
3. Develop a flexible and comprehensive integration
plan.
4. Share information and encourage communication.
5. Encourage employee participation and involvement.
6. Enhance commitment to the new entity.
7. Manage the transition.

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Corporate Culture

8. Be sensitive to individual and timing considerations.

Naomi Stanford

tise. People will not be accepted into the organization

unless they can both meet performance objectives
and fit in socially. People new to a role have to learn it
from four different angles: industry, organization, job
content, and group processes. Each is equally important in achieving success.

Any decision to try to make a planned change to an

organizations culture should derive from a perceived
and communicable shortfall in business performance
or change in business strategy. Because planned culture change is a slow and often
To function effectively within an organization, all those who
painful process, it should not be
undertaken without a compelling belong to it have to learn the culture and adapt their learnbusiness reason.
ing as it changes. This is not surprising as culture develops

When questions about protecting through the interaction of people making sense of their world.
an organizations culture arise,
To help mitigate the risks associated with integratthey typically relate to perceived threats to a culture
ing new employees, most large organizations have an
that works. This usually occurs when one company
induction or orientation process that usually provides
buys another, or when an organizations heritage or
such information as organization charts, statements
traditional cultural strengths are undermined, perof values, and explanations or particular processes.
haps as a result of actions taken in response to market
Many organizations fall short in providing informachanges and threats.
tion on less tangible aspects, such as assumptions
Can Culture be Learned?
about the role, the best style to use for getting quick
results, and the organizational norms and expectaStaying in tune with the corporate culture is a contions in a word, the culture. This tacit knowledge
tinuous process of learning and adaptation for all of
is difficult for newcomers to grasp without the help
an organizations members. To learn the culture well
of insiders who point them in the right direction
enough to fit in and succeed, individuals have to demand explain what is expected. People cannot learn
onstrate certain attributes. The most important are:
the culture by themselves; they are reliant on the
a commitment to develop links with others;
help of others both in and outside the organization.
strong motivation and the appropriate skills to
They have to show that they have learned it within an
learn what is needed;
acceptable time frame, and they have to pay the price
of membership. The price of membership refers to
astute situational awareness and responsiveness;
the cost to the new joiner of being culturally assimi the possession of values that match those of the
lated. It is usually a high-profile make-or-break event,
organization or are adaptable to them; and
often related to the completion and presentation of
an ability to align personal knowledge, experia first task or project that has to be quickly and sucence, values, and sense of importance with the
cessfully achieved. It marks the point of crossing the
organizations values, goals and plans.
boundary from being an outsider to being an insider.
Recognizing the signs of successful acceptance means
Culture can be learned if these attributes are in place.
reading social and cultural signs accurately. The clues
It is essential for newcomers to be adept at reading
are often subtle, although in some organizations there
and adjusting to the culture. If they cannot do this,
is a formal rite of passage.
they will be shunned or expelled from the organization.
Learning how to fit in and succeed in a corporate
culture is not easy. However, it can be done with a
There are certain attributes a newcomer needs to have
carefully planned approach, a respect for the norms
and demonstrate on entering a new culture. These
and protocols of the new organization, and the skills
relate to aspects of fitting in socially and getting on in
and attributes required to establish and build trust
terms of achieving performance objectives. They are
with the existing members of the organization
related more to personality than to technical experBusiness Book Summaries October 4, 2011 Copyright 2011 EBSCO Publishing Inc. All Rights Reserved

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Corporate Culture

Naomi Stanford
g

Features of the Book

Notes and references

Index

Reading Time: 6.5 Hours, 245 pages

Corporate Culture is written for organizational leaders and human resource professionals who would
like to build an effective corporate culture linked to
their business strategy, as well as those who want to
understand a particular organizational culture. It provides accessible information on culture and explains
the complexities of managing corporate cultures, and
was written for those who need practical, realistic
and pragmatic approaches that will help them understand and work with the elusive concept of culture.
The book contains many case histories and real life
examples from companies such as IKEA, McDonalds,
Ford, Toyota, Disney, and others. Each chapter ends
with a list of recap points, a detailed case history, a
review of lessons learned from that case history, and
a chapter summary. Readers are referred to exercises
(in Appendix 3) designed to strengthen their understanding of the concepts put forward in each chapter.

Contents
Acknowledgements
Preface
1. What is corporate culture?
2. Can culture be measured?
3. Does culture matter?
4. Is culture related to business success?
5. Culture: creation, accountability, and responsibility
6. What is the right organization culture?
7. Can culture be created, changed, or protected?
8. Can culture be learned?
Appendices
Glossary
Cultural Assessment Tools
Useful exercises

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Corporate Culture

Naomi Stanford

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