Organizational Change WalkMe TeamUpdated November 11, 2021

How Do Cultural Dimensions Affect Employee Performance?

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How Do Cultural Dimensions Affect Employee Performance?

What is the right organizational culture for your business? If you’re not sure, you can use the Hofstede’s cultural dimensions theory to get a better idea of what might work for your company.

Another useful model, Edgar Schein’s organizational culture framework, is particularly useful for understanding and influencing corporate culture.

Below, we’ll take a look at both of these models and see how they can be used to build a better workplace.

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Hofstede’s Cultural Dimensions Theory: A Quick Overview

The Geert Hofstede model, otherwise known as Hofstede’s cultural dimensions theory, describes culture in six dimensions:

Power distance. The Power Distance Index (PDI) is the degree to which people accept and expect that power is distributed unequally. 

Collectivism vs. individualism. This index, the CDI, describes how group-oriented a culture is.

Uncertainty avoidance. The UA index gauges tolerance for ambiguity and uncertainty.

Femininity vs. masculinity. This metric, MAS, describes a scale that measures “masculine” qualities, such as assertiveness, against “feminine” qualities, such as cooperation.

Short-term vs. long-term. The LTO measurement contrasts “long-term” traits such as problem-solving against “short-term” trains such as tradition.

Restraint vs. indulgence. IND measures how much a culture permits its members to freely indulge in and satisfy their “human desires.”

This model was originally used to describe how individuals relate to their national culture, though it has since been applied in a wide variety of contexts, including business.

The Hofstede cultural dimensions theory can be extremely useful for understanding different communication styles, cultures, behaviors, and attitudes. 

Business professionals, though, tend to focus heavily on organizational culture, rather than international cultures.

Edgar Schein and Organizational Culture

Edgard Schein, a former professor at MIT Sloan School of Management, specializes in organization development, career development, and organizational culture, among other areas.

His insights on organizational culture can be very useful for anyone who wants to build a more successful team culture.

According to his model, corporate culture consists of a few layers:

  • Artifacts represent the tangible manifestations of a corporate culture, such as dress codes and social norms
  • Values refer to the philosophy and the rules of behavior with which the workforce identifies
  • Assumptions are the deepest beliefs, or the aspects of the culture that are taken for granted

When proceeding with organizational culture change, managers can use this framework to analyze and better understand their own workplace culture. That information, in turn, can be used to inform culture change efforts and improve decison-making.

Why Invest in Culture Change?

Most leaders recognize the importance of culture in business. 

But to create a team culture that “works,” it’s first necessary to understand how culture contributes to the business and to set goals.

Here are just a few areas affected by culture:

  • Innovation and creativity. Cultures that are more traditional tend to focus more on what’s worked in the past. Forward-looking, innovative cultures, on the other hand, tend to think outside the box, adopt new trends early, and lead in areas such as digital innovation.
  • Productivity. Employee productivity depends on many factors, including their skills and attitudes. Workplace culture also affects how engaged and productive employees are. When individuals are aligned with the values of the company, for instance, they tend to find more meaning in their work and, as a result, they tend to be more engaged and productive.
  • Organizational communication. Culture also affects communication styles. A corporate climate that prefers transparency, openness, and friendliness, for example, can facilitate communication among workers. 

While it’s not the only factor to consider, culture is a defining characteristic of an organization. 

After all, culture affects every aspect of an organization, from the products and services it delivers to its customers and employees – and, ultimately, it can be a key differentiator for success and growth.

How Do You Create a Great Team Culture?

Naturally, every organization is different, and every team is different. And though there is no such thing as a perfect culture, certain traits are particularly useful in the modern workplace.

To achieve some of the benefits covered above, for instance, traits such as these can be useful:

  • Self-reliance. Employees who take the initiative require less micromanagement, less training, and they tend to handle tasks more effectively on their own. 
  • Openness to change. In today’s business world, it is important to have an agile workforce. Since organizational change has become the norm, employees need to be ready to adapt and learn new things.
  • Pro-learning. A culture of learning is just as important as being open to change. After all, many researchers predict that the future of work will involve more digital training, upskilling, and re-tooling. And in such a dynamic environment, learning will become the standard operating protocol for a large section of the workforce.

These traits, it should be noted, are only valuable if everyone is on the same page.

Employees’ individual values and beliefs, in other words, should be aligned with the organization’s. For this reason, managers and leaders should focus on hiring the right candidates, crafting the right teams, and ensuring employees fit with the desired organizational culture.

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