Culture has become a buzzword over the past couple of years and that is for good reason. You can find what we mean by culture in this article but, as a general overview, we consider culture to be specific to a group of people and a learned, rather than inherited behaviour. Culture has many layers and is about how different groups of people distinguish themselves from each other.
Most importantly, culture is a phenomenon that can be seen in everything we do. For example, from how food is produced to how it is presented in a restaurant, or how you act in that restaurant are all elements affected by culture.
However, if you find yourself confused when it comes to culture and the impacts it has on everyday life, you are not alone. In this article we clarify two types of culture, National Culture and Organisational Culture, how they are different, and how they are connected.
National Culture is the term we use to refer to a group of people who have been brought up within a given country. In comparison to others, these individuals tend to share certain expectations of how things should be done and values around these expectations. The expectations are usually completely formed by the age of 12 to 14 and are a product of the environment we grow up in. At the same time, because personality plays a strong role in individual behaviour, you will be less likely to see the characteristics of National Culture when you're looking at a small group of people. The larger that group becomes, the more noticeable National Culture will also be.
For example, if you deal with a single French person, what you will notice are his or her individual qualities. If you see a small group of French people, it's entirely possible that they are, for instance, a group of friends and share similar individual qualities but still vastly differ from most of the nation. It's also possible that their individual qualities have very little in common and you might have difficulties spotting any similarities.
If you deal with a large number of French people at the same time, the individual qualities of each will be less noticeable and you'll begin to see what they have in common. However, this only becomes truly clear if you are able to see them in comparison to another group. For example, how a large number of French business people compare in a meeting with a large group of British business people. When all other elements are relatively equal, this is when the differences of National Culture will become most apparent.
National Culture is a group phenomenon that can only be measured in comparison.
The example above already describes one of the key differences that can exist between National Culture and Organisational Culture. The large group of French business people in comparison to the British business people can show us differences in National Culture. However, this group of people would not represent French culture as a whole. In this case,it would be wrong to assume that the culture of their organisation is identical to French culture. This comparison is impossible to make because we are talking about two different levels of society. Still, the company would have a culture of some sort. We refer to this as Organisational Culture.
When we talk about Organisational Culture, we are referring to how the members of the organisation relate to each other, to their work and to the outside world. Like with National Culture, this becomes more relevant when comparing organisations and observing how one group of people distinguishes itself from another.
Organisational Culture is the result of many factors but tends to be more straightforward and precise to measure than National Culture. While the size of the organisation and personalities of its members will still play a large role, we can observe and define its culture because most organisations have clear goals / objectives, requirements regarding working practices, processes, procedures, etc. Most of the activities within the organisation are then designed to meet those objectives and requirements and by measuring the practices within the organisation we can see if the culture is functional or not, meaning whether the way of working supports the execution of the goals the organisation has or might hinder them.
Organisational Culture is a phenomenon that is measured by looking at the practices within the organisation, and how those practices differ from other organisations.
How National Culture and Organisational Culture are different
Professor Hofstede's definition of culture, the programming of the human mind by which one group of people distinguishes itself from another group, can be applied to both. Yet, it is clear that National Culture and Organisational Culture are not the same. We have already begun to highlight some of the differences you find between National Culture and Organisational Culture.
One main difference we have mentioned is that National Culture is based on the values that groups of individuals prefer or expect to be carried out. On the other hand, Organisational Culture is based on the practices that are carried out within the organisation.
While differences between values is something that is difficult to measure, the organisational practices are the key for being able to precisely measure Organisational Culture. By focusing on the practices, we can hone in on organisational transformation and shift undesirable practices to more functional ones, better supporting the goals / objectives of the organisation.
The difference in the root of National Culture and Organisational Culture also impacts how fast they can change. National Culture changes very slowly as the values of a collective group of people are often based on their past experiences, as well as family and historical experiences. With the 6 Dimensions of National Culture, we see the scores reverified by different researchers over time. In addition, when we do see a change, such as in Individualism, we see that cultures move in the same direction, maintaining the relative distances between nations. The changes in National Culture are relatively inconsequential over time.
On the other hand, Organisational Culture is based on practices and is something that can vary greatly from organisation to organisation, regardless of the country or industry. In addition, the Organisational Culture is impacted by a CEO or a charismatic leader or management team, and can shift over short periods. Whether this transformation is intentional or not is determined by the structure of the organisation and intentions of the management, but an established Organisational Culture and change is inevitable. When this change is harnessed to fit the organisational strategy, it can be a driving element of success.
Creating Organisational Culture Change
Most organisations wanting to learn about Organisational Culture are interested in the possibility of transforming their culture. Even those organisations that want to become more culturally diverse, increase emotional wellbeing in the workplace, etc. are actually looking to change their practices, aka change their Organisational Culture. You can read more about how to change Organisational Culture in this article, but the first step is choosing the best Organisational Culture for you.
The process of defining and establishing a functional Organisational Culture is a continuous and cyclical process. This is because goals / objectives are updated and changed over time, so your Organisational Culture should be too. In addition, it is all too easy to fall into bad habits or take good practices to a dysfunctional extreme. However, with a reliable measurement tool and a knowledgeable team, creating cultural transformation does not have to be complicated.
At the end of the day, if you want to create cultural change, you have to understand where you currently are, where you want to go, and the actions that will take you from point A to point B. We have our own methods for doing this at Hofstede Insights and if you want more information about our process, see this page.
Why a change in Organisational Culture is necessary for a lasting change in Intercultural Management
One of the biggest topics we work with at Hofstede Insights is aligning working practices and communication in multicultural teams. We get requests for many different types of workshops and development sessions from companies looking to improve cross-cultural teamwork. We truly believe that positive change can be achieved but, for lasting transformation, we have to focus first on the Organisational Culture.
This is because it is unlikely that employees or team members change their values, meaning their National Culture preferences don’t change, so we have to focus on the organisational practices. In practice this means that while the organisation will set its own Organisational Culture, how people feel about the practices is dictated by their National Culture. People don’t generally like to work against their values for a longer period of time, and therefore you need to take their National Culture into account if you want to see a sustainable long term change in your organisation.
Once you have aligned on where you want to go, changing practices can be relatively straightforward and simple, as long as you are implementing them in an effective way. Therefore, the path to lasting change will begin with the evaluation of current practices, awareness of where the transformations should be implemented, and actions taken to move the practices in a direction that makes sense for the company and the employee values.
A short example
*All names have been changed for client privacy.
PACKED is an international manufacturing company. They are headquartered in Sweden but have manufacturing and distributing plants all over the world. One of the countries they have been most successful to date is in Thailand. 18 months ago, the country manager, Sawadhee, who was well loved and continuously showed sales growth, was offered a promotion to Regional Sales Director for the Asia-Pacific region.
The Swedish VP of Sales for PACKED, Johan, recognised Sawadhee’s good work and offered him this role because he believed it could help boost sales and morale across the region. After 18 months with Sawadhee in the new role, Johan is confused because Sawadhee is having a much smaller impact with a larger role. Both the Asia-Pacific region and Thailand are suffering in terms of sales and overall employee motivation.
The promotion is considered to be a failure and the PACKED management team isn’t sure what actions to take. Johan came to us for advice about the role culture played in this situation and what he could do to alleviate the strain on the company.
In cases like these, we are looking at differences between National Cultures and the values that people have, as well as Organisational Culture that determines how work gets done. However, here we must take into account that our solutions will most likely need to focus on Organisational Culture practices. This is because people accept and can adapt to different practices but, in most cases, they will not change their values.
In this particular case, clearer communication was needed around expectations and desires by both sides. Expectations around how communication should be done is a question of National Culture; how to better align on what are the best steps moving forward will be determined by the everyday practices that are determined by Organisational Culture. In this situation we also had to make sure the organisational practices matched up with the overall company objectives to make sure the Organisational Culture supported the strategy and goals. With the right cultural perspective, we were able to support the company and PACKED was able to advance in the right direction.
If you have interest in working with us on supporting your cultural needs, please contact us here.
Editor's Note: This post was originally published in January 2019, and last updated in November 2021.