Organization culture consists of an accumulation of intangible assets, i.e., variants of intellectual, structural, and relationship capital. These intangibles’ collectively distinguish a company relative to its brand, reputation, performance, attractivity, competitiveness, goodwill, retention, sustainability, etc., and its product and services. Desirably, organization culture’s maturate as dependence, expectation, and credibility, etc.
Effective organization cultures’ contributory role and value is further evidenced in the findings of numerous studies/surveys commissioned-undertaken by professional associations and academia, not unlike a 2012 Society for Human Resource Management (SHRM), survey which asked HR (human resource) leaders to identify significant ‘workforce management and staffing challenges’. The survey attracted 770 respondents who described ‘the challenges’ as variously encompassing…
• employee engagement
• employee retention
• effective performance management
• employee recruitment, and
• company culture management
Arguably, each of these responses are indeed relevant to organizational culture. Perhaps to some, this SHRM survey may, at first blush, appear dated when cast in the context of the increasingly aggressive, predatorial, and go fast, go hard, go global entrepreneurial business (transaction) environment. And, to be sure, the instructive findings of this SHRM survey have been replicated – validated through numerous other (similar) studies-surveys. Point being, I find no need to quibble – debate what the ‘workforce management and staffing challenges’ are.
Of course, as observed through an ‘all things intangible lens’, these challenges represent signals that should further influence business leaders and management teams to conclude, as others have, that it is in their interest to devote time, energy, and yes, some resources, to aggressively engage their organization to develop, execute, and sustain an intelligent company culture befitting their near term and strategic needs (planning) which can be prudently and legitimately applied to deliver desired, measurable, and sustainable returns.
It’s hardly rocket science that a well-defined company (sector relevant) culture can become a prized, attractive, and measurable achievement which in turn, manifests as a powerful contributor to organization performance, competitiveness, value, attractivity, sustainability, and bringing singular clarity-definition to a desired brand.
An organization-wide culture, whereby employees, management teams, and c-suites alike, are faithfully committed to articulating a shared and principled base comprised of and distinguished by an organization’s intellectual, structural, relationship, and competitive capital, ala, forms of intangible assets, can, and usually will manifest as embedded – internalized bonds which genuinely mitigates each of the ‘challenges’ conveyed in the SHRM survey above.
These important and attractive realities, for any organization, will collectively manifest in the economic fact that 80+% of most organization’s value, sources of revenue, competitiveness, and other ‘building blocks’ for achieving-realizing growth, profitability, and sustainability today lie in – evolve directly from various collections of (organizational) intangible assets, primarily, intellectual, structural, and relationship capital.
It is certainly not a stretch then for experienced organization (forward thinking-looking) leadership to conclude that a principled and consistent culture can, and frequently does, serve as a catalyst for internalizing and enhancing near term and strategic needs among them being…
• employee engagement, retention, and performance.
• distinguishing organizations’ (brand) attractivity and recruitment.
Based on many years of research and insights produced by Dr. Edgar Schein, organization culture consists of emerging and progressive stages of…
• employees (collectively) recognizing and acting on a shared system of values, norms, beliefs, and attitudes that collectively define and clarify what is important.
• employees, at all levels, recognizing that they frequently learn as – when they are solving problems. If the problem-solving methodologies work well enough, employees and ‘the beneficiaries’ will consider them valid and worthy of being taught and passed along to new employees, because…
• they represent the correct way to perceive, think, and feel in relation to addressing (internal, external) problems that their company routinely faces, which, in turn, leads to efficiencies, competitive advantages, and reputational value, etc. (Adapted by Michael D. Moberly from the work of Dr. Edgar Shein)
For most organizations, the initial step in developing a principled culture involves…
• determining what attitudes, beliefs, and history, warrant clarity and collective action.
• having a clear understanding how those attitudes and beliefs can translate (be executed and become operational) as near term – strategic ‘need relevant’ behaviors and actions on an organization-wide basis.
As aptly pointed out by Dr. Kenan Jarboe (Athena Alliance monograph) appropriately titled ‘Intangible Asset Monetization: The Promise and the Reality’, there are six factors considered by financial markets (i.e., asset buyers, sellers, and investors) with respect to determining the ‘suitability’ of an (intangible) asset. Of those six factors, one is an assets’ transferability. In other words, is an organization’s culture transferrable? Or is it so (company, business unit) specific that would make its replication and/or sustainability challenging should any base changes occur?
Unfortunately, the contributory role and value of an organization-wide culture seldom, if ever, appears on management teams’ conventional mba oriented dashboards, in part, I believe, because those dashboards remain largely focused on tangible (physical) assets vs. intangible (non-physical) assets, i.e., culture, intellectual, relationship, and structural capital
Too, for some leadership teams a principled organizational culture, remains somewhat of an administrative, fiscal, and competitive advantage mystery in terms of understanding how best to utilize – exploit this increasingly influential asset.
A desired outcome of course, is that an organization’s culture will be resilient, self-perpetuating, principled, and scalable to consistently deliver measurable performance and desired returns. Of course, building a principled organizational culture is not something which only evolves from a top-down framework. In other words, an organization culture is seldom a characteristic wholly owned and executed by a management team or c-suite. Instead, a well-grounded and principled organization-wide culture provides permanence, depth, and confidence among employees regarding their abilities and capabilities.
Adapted by Michael D. Moberly from the fine work of Jennifer King
Michael D. Moberly July 31, 2017 firstname.lastname@example.org ‘A business intangible asset blog where attention span really matters’!