The 4 different types of company culture

Company Culture at riskmethods

Company culture—otherwise known as organizational culture—is an important aspect of any job. The culture of a workplace is often misconstrued as a company’s core values and benefits; however these characteristics only help guide the culture of an office. In reality, organizational culture is defined as the shared values, attitudes, and practices that make up your company—the personality in some sense.

By Lindsey Meade, Talent Coordinator

So why does company culture matter?—culture plays a large part in overall employee satisfaction. A strong culture keeps employees engaged and excited about their work, and helps attract potential future employees. Every organizational culture is unique, and can evolve over-time, but generally fits one of four culture types: Market, Adhocracy, Hierarchy, and Clan.

These four culture types are distinct in their characteristics and goals, and function in a specific way. Identifying which culture you like is important—this enables you to seek out environments that are compatible with your values so that you can be as engaged as possible.

Market Culture

Market culture primarily focuses on growth and profitability. These types of organizations are results-oriented and push for external success. Quotas, targets and results are stressed, which can lead to a competitive atmosphere. Wins are celebrated and losses are considered against the bottom line. Stability and control, as well as an external focus and differentiation are valued. Market culture is common at larger companies that are looking to be the best in their industry. Because of their size and strength, this set-up is ideal and yields profitability and success. Employees are united a singular goal they can work toward.

Adhocracy Culture

Adhocracy culture is similar to market culture, in that it values external focus and differentiation; however, stability is unlikely to be found here. While adhocracy culture puts a lot of value in market growth and success, it also values flexibility and discretion. Companies with adhocracy culture are creating cutting-edge innovations and are generally looking to bring their own twist to an industry.

Risk-takers fit in well in adhocratic cultures, appreciated for their creativity and individuality—both of which are necessary characteristics to be innovative. Employees are motivated by their urge to come up with the next great idea and professional development opportunities are common.

Adhocracy is common in the tech industry, as products are constantly being updated and evolved. Though competitive, wins are celebrated by teams and the company as a whole, and there is an understanding that company growth is positive for everyone.

Hierarchy Culture

Hierarchy culture thrives on structure and stability and adheres to traditional corporate structure. Internal organization is important to hierarchical companies, and often includes multiple management tiers from entry level employees up to c-level executives.

Generally, these cultures are risk averse. They have a set way of doing things and stick to it. These well-defined processes directly relate to the company’s goals. Some people enjoy the stability and familiarity of this structure, while others find it a bit too rigid.

With so much structure, there is little room for creativity, and individual needs may come second to that of the company. That being said, hierarchical cultures provide employees with clear job progression and direction, which is an amenity other structures cannot always provide.

Clan Culture

Clan culture is all about the team. It is people-focused, highly collaborative, and general horizontal (think open floorplans and easy access to high-level employees) Clan culture generally has more engaged employees as employees are encouraged to think outside of the box and share their ideas. Being highly flexible, these types of companies often have excellent work-life balance and offer significant benefits to help employees be their most successful.

Like other culture types, clan culture has its drawbacks—the major one being that it is hard to maintain. It’s easy to promote a family-like atmosphere at a small-business or start-up, but much more difficult when dealing with large numbers of employees and differing opinions.

While one of these culture types may stand out to you, it’s important to remember that organizations may incorporate a little of each, making each and every culture unique. Office dynamics are constantly changing with new technologies, personnel changes and growth. The best advice I can give to job seekers is to find a culture that you feel you can add to. For current employees, ask yourself how you add to your current company culture and discuss it with others. Perhaps, you can lead the next cultural revolution in your own office!

Back to top