Organisational Culture: Types and How to Build it?

Two companies can have the same strategy, yet achieve very different results. The difference often lies in their Organisational Culture, which shapes the values, behaviours, and attitudes that influence how work gets done every day.

A positive culture aligns people with shared goals, while a weak one can undermine even the best plans. In this blog, you’ll explore what is Organisational Culture, its key types and practical ways to build one that supports performance, engagement, and long-term success. Let's dive in to create an effective culture!

What is Organisational Culture? 

Organisational Culture is the shared way people behave, think and work together inside a company. It includes the values, beliefs, attitudes and habits that shape daily actions and decisions. A strong culture builds a positive work environment where people feel valued and perform at their best. Think of it as the personality of the organisation since it’s what makes your company unique. 

This Organisational Culture is reflected in both visible elements, such as workplace practices and policies, and invisible aspects like assumptions, trust, and shared expectations. Over time, it plays a crucial role in guiding employee behaviour and aligning individuals with organisational goals.
 

Types of Organisational Culture 

Every organisation has its own personality, shaped by its culture. Here are the seven common types of Organisational Culture, each with its unique strengths: 
 

1) Clan Culture 

This culture prioritises creating a close-knit, family-like environment where trust, loyalty, and teamwork are key.  

1) Focus: People, relationships, and collaboration. 

2) Style: Friendly, nurturing, and team-oriented. 

3) Environment: Like a family, this culture values loyalty, participation, and mentoring. Leaders act more like coaches than bosses, and open communication is key. 

4) Best for: Companies that value strong interpersonal connections, work-life balance, and employee engagement. Common in small businesses, start-ups, and family-run organisations. 

2) Innovative Culture 

These organisations value originality, encourage experimentation, and reward risk-takers who challenge the status quo to create cutting-edge solutions.

1) Focus: Creativity, risk-taking, and continuous improvement. 

2) Style: Bold, idea-driven, and experimental. 

3) Environment: This culture thrives on pushing boundaries. Employees are encouraged to challenge norms, try new approaches, and fail fast to learn.

4) Best for: Tech companies, start-ups, and organisations focused on constant evolution and product innovation. 

3) Learning Culture 

It fosters a mindset of always improving, acquiring knowledge, learning from mistakes, and being open to new perspectives and technologies. 

1) Focus: Knowledge, growth, and self-improvement. 

2) Style: Development-driven and curious. 

3) Environment: Emphasises learning from success and failure and promotes ongoing training, feedback, and development opportunities. Mistakes are seen as lessons. 

4) Best for: Companies investing in talent development, future-ready skills, and long-term career growth. 

4) Adhocracy Culture 

Here, speed and flexibility take centre stage to stay ahead of competitors through continual innovation and fast decision-making.

1) Focus: Agility, innovation, and entrepreneurship. 

2) Style: Fast-paced, adaptive, and opportunity-driven. 

3) Environment: Highly dynamic with flexible structures. Decision-making is fast, and creativity is encouraged at every level. Risk-taking is seen as essential. 

4) Best for: Industries that change rapidly, like digital, fintech, or media and companies needing to stay ahead of trends.

5) Purpose-driven Culture 

This culture focuses on serving a greater purpose beyond profit, promoting ethical practices and giving employees meaningful reasons to care about their work. 

1) Focus: Mission, values, and social impact. 

2) Style: Ethical, passionate, and meaningful. 

3) Environment: Employees feel deeply connected to the company’s mission. Work is not just about profit but about making a difference in society or the environment. 

4) Best for: Non-profits, social enterprises, sustainable brands, or any company focused on meaningful change. 

6) Market Culture 

This culture is all about winning. Success is defined as hitting targets, outperforming competitors, and achieving excellence.  

1) Focus: Results, competition, and achievement. 

2) Style: Target-driven, high-performance, and customer-focused. 

3) Environment: Success is measured through winning, market share, and numbers. Employees are motivated by results, incentives, and accountability. 

4) Best for: Competitive industries like sales, retail, and finance, where metrics and performance matter most. 

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7) Hierarchy Culture 

Maintaining order and consistency is the top priority of this Organisational Culture. Strict processes, formal procedures, and risk avoidance ensure smooth and predictable operations. 

1) Focus: Order, stability, and control. 

2) Style: Structured, rule-based, and process-focused. 

3) Environment: Formal policies and procedures guide behaviour. Decision-making is top-down, and roles are clearly defined. 

4) Best for: Government, healthcare, banks, and large corporations where compliance, consistency, and efficiency are essential. 

Key Qualities That Shape an Exceptional Organisational Culture

Exceptional Organisational Cultures are intentionally built, consistently followed, and shaped by everyday behaviours across the organisation. Here are the key qualities that you can implement:

1)  Trust and Transparency: Open communication builds trust, encourages collaboration, and helps employees feel confident sharing ideas and concerns.

2) Alignment With Purpose: A clear organisational purpose helps employees understand their impact, boosting motivation, focus, and commitment to shared goals.

3) Resilience and Adaptability: A resilient culture supports change, encourages learning, and helps teams adjust effectively during uncertainty.

4) Focus on Performance: Clear expectations, accountability, and continuous improvement drive consistent results and high performance across teams.

5) Culture of Appreciation: Regular recognition makes employees feel valued, increasing engagement, morale, and long-term commitment.

6) Strong Integrity and Leadership: Ethical, consistent leadership sets clear standards, builds trust, and positively influences workplace behaviour.

7) Innovation and Creative Thinking: Encouraging creativity enables problem-solving skills, continuous improvement, and staying competitive in a changing environment.

How to Build a Strong Organisational Culture?

Creating a strong Organisational Culture requires intention, consistency, and leadership. Here’s how to build a lasting and positive culture: 

1) Establish Shared Values 

Your values are the foundation of your culture. Clearly define what your company believes in, like integrity, innovation, collaboration, or customer-first thinking. Remember these points: 

1) These values must guide daily actions and decisions 

2) You must communicate values regularly, not just during onboarding 

3) You should reinforce them in meetings, reviews and internal messages 

4) Leaders must consistently model the values in their behaviour 

5) The culture must be lived, not just displayed on posters 

2) Promote Diversity, Equity, and Inclusion 

An inclusive culture welcomes people from all backgrounds and ensures everyone feels respected, valued, and empowered. Diversity brings fresh ideas and unique perspectives, while equity ensures fair opportunities for all. Inclusion builds genuine connections and makes people feel like they truly belong. Here’s how to promote Diversity, Equity, and Inclusion (DEI) in your workplace:
 

1) Hire and support people from diverse backgrounds 

2) Create a safe, respectful, and inclusive environment 

3) Encourage open conversations about identity, equity, and belonging 

4) Celebrate cultural differences and unique contributions 

5) Ensure everyone feels heard, seen, and valued 

3) Ground Your Culture in Mutual Trust 

Trust is the backbone of a thriving culture. When employees trust their leaders and peers, they feel safe to admit mistakes, share ideas and do their best work without fear or pressure. Remember these points: 

1) Be open and honest in communication 

2) Keep promises and follow through on commitments 

3) Build psychological safety, no fear of speaking up 

4) Handle mistakes with support, not blame 

5) Encourage respectful, two-way feedback
 

4) Distribute Responsibility Where Appropriate 

Empowering employees to make decisions builds ownership and accountability. When people have the autonomy to lead and contribute, they feel more engaged and trusted. Remember these points: 

1) Avoid micromanagement and trust your team’s capabilities 

2) Allow decision-making at different levels 

3) Encourage initiative and problem-solving 

4) Share leadership in projects where possible 

5) Recognise and reward responsible ownership 

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5) Enhance Clarity and Break Down Silos 

Clear communication and aligned goals help teams move in the same direction. Breaking down silos fosters collaboration, prevents misunderstandings, and drives a united culture. Consider these points: 

1) Ensure roles and goals are clearly defined 

2) Share the company vision and team objectives openly 

3) Encourage cross-team collaboration 

4) Remove barriers that limit communication 

5) Use shared tools for better visibility and alignment 

6) Hiring and Onboarding Practices 

Organisational Culture starts from the moment someone applies for a job. Hiring people who align with your values and onboarding them intentionally sets the tone for long-term engagement and success. Remember these points: 

1) Hire for cultural fit and shared values 

2) Use interviews to assess mindset and attitude 

3) Introduce company culture early in onboarding 

4) Assign mentors or buddies for guidance 

5) Reinforce culture through ongoing training and communication 

How Does Organisational Culture Influence Employees?

Organisational Culture has a direct and lasting influence on how employees think, feel, and behave at work. It shapes everyday experiences, including communication, collaboration, decision-making, and leadership interactions. Let's check how it influences employees in a positive manner:

1) Improves employee retention by creating a workplace people want to stay in

2) Influences job acceptance decisions, with employees prioritising culture over salary

3) Boosts employee engagement, leading to higher motivation and productivity

4)Reduces absenteeism and turnover through increased satisfaction and commitment

5) Supports mental health and well-being by promoting fulfilment and work-life balance

6) Enhances overall performance by aligning employees with organisational goals

Common Workplace Biases that Weaken Organisational Culture

Organisational Culture can be weakened by unconscious biases that affect how people think and make decisions. If these biases are not addressed, they reduce new ideas, limit different viewpoints, and make employees feel uncomfortable speaking up or sharing their opinions. Here are some common biases:

1) Groupthink

Groupthink happens when people agree with the group instead of their own critical thinking. Employees may avoid sharing different opinions to keep the peace, which can lead to poor decisions and fewer new ideas.

2) Authority Bias

Authority bias occurs when employees rely too much on leaders’ opinions, even if they are incorrect. This reduces questioning, limits discussion, and can stop better ideas from being considered.

3) Status Quo Bias

Status quo bias is the tendency to resist change and the preference for doing things the same way. It can slow down improvement, limit innovation, and make organisations less adaptable to evolving challenges.

4) Confirmation Bias

Confirmation bias happens when people focus only on information that supports what they already believe. This leads to one-sided thinking and weaker decision-making.

How to Choose the Right Organisational Culture for Your Business?

Choosing the right Organisational Culture is essential for long-term success. Let's check how you can do it:

1) Consider Organisational Goals and Direction

Start by clearly defining your organisation’s goals, vision, and long-term direction. Whether your focus is innovation, stability, customer service, or rapid growth, your culture should support these priorities. Aligning culture with strategy ensures employees understand what matters most and how their work contributes to overall success.

2) Understand Your Team's Working Styles

Every organisation is made up of individuals with different working preferences, strengths, and motivations. Understanding how your teams collaborate, communicate, and solve problems helps shape a culture that fits their natural way of working. A culture that aligns with employee needs encourages engagement, productivity, and job satisfaction.

3) Use OCAI

The Organisational Culture Assessment Instrument (OCAI) is a widely used framework for identifying current and preferred Organisational Culture types. It helps organisations assess cultural gaps and understand where change may be needed. Using OCAI provides a structured, data-driven approach to building a culture that supports both employees and business goals.

Conclusion 

A strong Organisational Culture is built through simple, everyday actions. When people feel supported, trusted, and connected to a purpose, they enjoy coming to work and giving their best. Start by listening, being honest, and showing appreciation. Keep things clear, kind, and consistent. Over time, these small steps create a workplace where everyone feels happy, valued, and proud to be part of the team. 

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