Beneath and Beyond Corporate Culture

Half-truths, pretense, and fragmentation in contemporary corporate culture

Corporate culture — as is generally understood — is formed of the shared values, attitudes, beliefs, and standards of behavior that characterize the nature of an organization and its members. This is the outcome of a process of adaptation to the world: competitors, technological and societal changes, and all the forces of a market-driven economy. And it is a given that the leaders (and especially founders) have an outsized impact on corporate culture.

We understand (without any formal grounding in sociology or what they teach at Harvard Business School) that there is a significant cultural difference between the cultures of ride-hailing upstart Uber and aircraft manufacturer Boeing. And at the same time, we are also just as likely to accept that some elements of these very different companies may be similar, even when the companies overall are not.

Along with all the other foundational changes of our time, is it possible that the nature of organizational culture itself is changing? By this I don’t mean changes in the culture of a specific organization, like what might happen when one company is acquired by another. I mean that the way organizational culture operates — its inner workings — has changed in subtle but profound ways. Or maybe has been changed through modern technologies, the shifting competitive forces of our globalized economy, and the attempts of business leaders to manipulate and fabricate culture for business ends. And, as a result, we have endemic disengagement of the workforce and a truncated and transactional relationship between the company and its employees, all hidden under the pretense of camaraderie and shared purpose.

Let’s begin at the beginning, with an exploration of the classical model of organizational culture, and then examine how the machinery of culture is falling apart.

Edgar Schein’s Levels of Organizational Culture

One insight bounding the discussion around organizational culture that we owe to the research and thinking of Edgar Schein¹, who observed that cultures can be modeled as having levels, or layers.


Schein’s Pyramid

In particular, Schein argued that cultures have three levels:

Artifacts — The topmost level, where we find visible organization structures and processes. As Schein put it,

Artifacts include the visible products of the group, such as the architecture of its physical environment; its language; its technology and products; its artistic creations; its style, as embodied in clothing, manners of address, emotional displays, and myths and stories told about the organization; its published lists of values; its observable rituals and ceremonies; and so on.

Hence IBM’s suits versus Apple’s t-shirts and sneakers, Google’s ‘Don’t be evil’, and the mythological garage for Hewlett Packard. But this is all relatively superficial: the froth of the waves on a deep, deep ocean.

Members of a group will find it inconceivable to act in a way that runs counter to their underlying cultural convictions.

The indoctrination of new members into the organization and the processes involved are themselves artifacts, and likewise org charts, operating manuals, how-tos, and so on.

While this level is easy to observe, as Schein states, it is hard to ‘decipher’. To grasp what is going on the company surface, you need to dig deeper, into lower levels. As just one example, two companies may have apparently similar open office layouts, but one company may have evolved that twenty years ago from an engineering/manufacturing starting point, and the other may have instituted open offices a few years ago as part of a massive cost-cutting effort.

Espoused Beliefs and Values — As businesses encounter challenges and (hopefully) overcome them, the theories that are proven become inculcated into explicitly stated beliefs and the values that motivate them. This is generally the outgrowth of the work of leaders, and their efforts in convincing others to rally to strategic plans and resulting tactics that are ostensibly in alignment with the bedrock beliefs and values. And ultimately these ideologies can be applied when the company meets new circumstances or difficulties. Schein gives the example of The HP Way, and I am reminded of Reed Hastings Netflix Culture deck, now updated.

Underlying Assumptions — Shared and unstated premises about the basic nature of the world and its people form the bottom of Schein’s pyramid. These are not viewed as the best of alternatives, subject to situational selection: they are foundational givens. As a result, members of a group will find it inconceivable to act in a way that runs counter to their underlying cultural convictions. So, in an engineering-dominated culture it would be impossible to intentionally design a product that is unsafe², or in a product-obsessed culture it would be impossible to release a product that doesn’t work³.

The base level of a company culture can also include dark elements, as we are finding in high-tech, where systematic bias against women in engineering is deeply embedded, to the extent that we have to believe this bias is foundational. And as we are witnessing the backlash from the enculturated, as the recent flare-up from James Damore’s manifesto demonstrates.

In general, questioning the primacy of the deep assumptions at the floor of company culture leads to pushback, and often angry pushback.

The Fall of Company Culture, and the Rise of Work Culture

People are starting to wonder about company culture, and are less likely to consider it the source of all that is good in business, a force for competitive advantage and a source for shared meaning. On the contrary, company culture may primarily serve as an ideological tool for indoctrination and compulsion, and by extension, a way to weed out cultural ‘misfits’.

From this perspective, the endemic level of disengagement in the workplace could be a rejection of the underlying assumptions of corporate cultures, individually and across the board. So, an employee at Google who disagrees with obvious biases against women in engineering — pay inequity, differences in social interaction, and the like — will disengage or actively struggle with espoused beliefs — like company policies — that are at variance with deeper — and perhaps unexpressed — values.

The pretense — that the company values the contributions of women in engineering — is shown by the mismatch between what is published on the company’s website and the actual disparity between men and women’s pay. And those values and pretenses may be shared widely, for example, across many companies in Silicon Valley. So leaving Google for Facebook might not wind up as a big change, culturally.

One trend may be a factor in the shifting realities of corporate culture. People are less committed to the companies where they work, and vice versa. The stark lack of loyalty on both sides of the worker/workplace relationship undermines the potency of corporate culture. And rapid turnover of workers and the growing prevalence of freelancers also diminishes the impact of culture on those pulling on the company’s strategic towline.

I believe that we are witnessing, therefore, the decline of the power of corporate culture, and the rise of an alternative, what I call work culture. Work culture can be modeled like Schein’s pyramid, with artifacts, espoused beliefs and values, and underlying assumptions, but these are shared by a more diffused community of individuals, and not limited to a single company, or restricted to companies, at all.

Start-up/Entrepreneurial v. Fast-and-Loose Work Cultures

We continuously see evidence of the growing start-up/entrepreneurial work culture, shared by tens of thousands of tech-obsessed start-up companies and perhaps millions of entrepreneurs, more alike than dissimilar.

At the same time, there are other growing work cultures with ideas that are clearly adversarial with the premises of start-up/entrepreneurial work culture. The one where I reside is what we could think of as ‘fast-and-loose’⁴ work culture.

I will explore some of the difference between these cultures with an example. A recent article included this fragment:

According to a PwC study, above all else, Millennials “value choice, flexibility, and experience in the places they work”:

“As work-life balance is replaced by work-life integration, flexible workplace environments will increasingly be regarded by CEOs, workplace strategists, HR leaders, and real estate executives as the best “talent” solution, thus becoming the new industry standard.”

In practice, according to Convene’s research, this boils down to a number of key indicators that will shape the way we design and build workplaces in the future. Here are 3 of them:

1. Every workspace environment, including those operated by commercial landlords, will be under increasing pressure to transition to human-focused flexible space.

On the whole, work/life balance is something of a myth. What’s much more attainable is work/life integration, and since many business owners and employees are already living this experience, it’s logical to expect more of the same.

Many members of the start-up/entrepreneurial work culture might nod their heads, accepting the workist assertion that ‘work/life balance is a myth’ because some group of people believes that ‘work/life integration’ is the new norm. In this article, and the referenced PwC report, the underlying assumption is the impossibility of balance, and the inescapability of ‘integration’ which is a synonym for being consumed by work, totally.

And if I were crazy enough to join a company based on those principles — and if they were crazy enough to hire me — I would be disengaged, at the least, and more likely rejected by the organism’s immune system, because at a foundational level I believe in work/life balance and they don’t. There is no middle ground, is there?

That is one of the things about culture that maybe hasn’t changed: we are both simultaneously divided and united by our cultural beliefs. But increasingly that is less due to the waning power of corporate culture, and instead the growing draw of work culture.

See Who Owns Work, and Its Future, under the A Working Future imprint.

  1. Edgar Schein, Organizational Culture.

  2. Note the example of Volkswagen and its diesel cheat scandal, which demonstrates that an organizational culture can pervert ostensible orientation around engineering principles — like ‘do no harm’ — when the actual premises of the culture are self-preservation or profits at any cost.

  3. Apple’s earliest release of its Maps and the recent release of the not-very-usable LTE-enabled Apple Watch suggest that the company doesn’t have this cultural premise as deeply embedded as it might, or that the leadership decides to release products before they are actually fit for their purpose, at least some of the time. Again, Apple is either opting to put the company’s interests ahead of the customer, like VW did, or they are inept. What do you think?

  4. Fast-and-loose work culture is typified by an aversion to the coercive controls and tight connections of corporate culture, and an acceptance of looser extra-business work cultures as primary in our era.