The framework for assessing organisational culture: Technology Companies
Here we share the framework for assessing organisational culture within a technology organisation. There is a strong link between organisational values on the left side of the CHART (shown below), agile behaviours, and increased business performance.
By implementing these practises in a technology organisation, you can act your way to a better culture.
The thing to remember is because culture is intangible, with numerous definitions and models it’s a real challenge is to find a well-defined culture model that can be measured effectively and, more importantly, has predictive power, for example, when planning technology projects or business transformation initiatives. We’ve devised a simple way for your organisation to do this.
To get started for assessing your organisation as-is, you will need to plot the results against the following chart below.
The more you find yourself leaning to the left of the chat, the more innovative your company culture is said to be. The idea is to act your way to a better culture once you have identified your company’s current state using this chart:
To be able to plot a realistic picture, you will need to undergo analysis of each priority in your organisation. We take a look at each in more detail below.
Growth vs. Profitability Assessment
Under this part of the framework to assess company culture try measuring based on the below information on growth vs profitability:
- When evaluating an organisation: Ask what weighs heavier: profitability or growth?
- Asses profitability by analysing: a) company’s net profit, b) income statement, c) profitability ratio.
- Asses growth: Growth for a business is essentially an expansion, making the company bigger, increasing its market-share, and ultimately making it more profitable. Measuring growth is possible by looking at some pertinent statistics, such as overall sales, the number of staff, market share, and turnover. And view the data historically and plot this against previous month, quarter and year to asses to growth over time.
Why is this important for business transformation?
Assessing growth stats vs profitability gives you a good understanding of the culture, the focus and the companies. It is never the full picture, but to make a full recommendation of where our culture is and where it should be going towards, this is a vital piece of information.
Flexibility vs. Scale Assessment
Ask the questions for assessing this area via the following considerations:
- What is the average lead time for doing a project, 1 month, 6 months, 12 months and so on.
- For Flexibility, consider, how many projects you can take on each month, the budget for these projects, number of people needed, how fast these projects can be executed.
- For scale consider, whether, you can add significantly more clients without increase your costs proportionally, then the business is scalable and becomes more profitable when it grows.
Long term Vs. Short term
How to gather information on long-term vs. short-term:
- To assess this area, look at your strategy management system (OKRs) and how well they are on track.
- Out of all on-going initiatives how many of these feed into your strategy?
- If only a few feeds into it then they are focused on short term gains – if a majority then they are focused on long-term gains.
Innovation Vs Execution
To assess this area, you will need to look at:
- The strategy overall, and what are the R&D activities and investments.
- Assess the innovation rated against market, network and environment.
- If you score highly on areas such as innovative products, innovative processes and innovative project management then your business is usually weighing less on the execution side.
Creativity vs. Discipline
Creativity is the ability to generate new ideas to allow your staff to remain creative, whereas discipline is the act of adhering to what has already been established. To assess your organisations creative versus the discipline, here is what to ask yourself:
1) Do you allow your staff to remain creative with some levels of discipline? Too much discipline results in inaction, an enemy of the innovative company culture.
2) Does your organisation have a degree of informality (such as allowing for employees to make their own decisions on times of work, or what they wear)?
3) Does the organisation allow for informality in decision making? For example, do you delegate responsibility to individuals throughout the organisation (not just leaders)? A less disciplined organisation would allow employees and leaders to make a decision in the meeting there and then. Having a free-fall culture like this leaves more room of creativity, regardless of your place in the hierarchy. Both informality and delegation of decision making will help the organisation foster creativity and speedier decision making which is what you want for an innovative culture.
Speed vs. Diligence
Tasks to gather information on speed vs. diligence:
- Is your organisation quick to execute on strategy, projects, initiative and decision making? Use metrics which measure lead time, employee satisfaction and how fast decisions are made to help you gauge this.
- Does your organisation prefer to be thorough in processes, leaving little to no room for creativity or flexibility? If so, then it is more diligence than speed.
- Does your organisation honour making mistakes quickly and cheaply which can easily be changed?
- Does your company prefer to do a lengthy due diligence of new tech, for example, spend larger sums of money after the diligence?
Risk taking vs. Prudence
Tasks to gather information on risk taking vs. prudence:
- Is your organisation promoting the development and discussion of new ideas?
- Do you grant employees autonomy? That is to say they have the feeling of freedom to choose how to go about executing on given tasks?
- Does your company focus on concepts, usually by taking small steps first, putting the concept in its simplest form out into the market as quickly as possible, testing it, gathering feedback and then adjust based on the feedback attained?
- Or, does your organisation prefer to thoroughly plan concepts, by having a lot of certainty before making decisions, (thus making your organisation more risk-averse).
Plotting on the above chart for organisational culture
Once you have plotted on the chart with the above information, you are able to see at a glance which areas need the most improvement to help your company foster an innovative company culture.
To learn more about innovative company culture, read our blog on: “Why should we care about culture and how it can help you accelerate the speed of innovation?”