The 8 Types of Company Culture Explained

Whether you are planning to find a new job or stay in your current position, salary, location, and promotions are not the only factors you should consider. Understanding company culture is one of the most important aspects of any business.

If you are a job seeker and want to know how it feels like to work at a specific organization, it’s time to explore which types of company culture exist. 

Key Points

  • What Is Company Culture
  • Types of Company Culture
    • Adhocracy Culture
    • Clan Culture
    • Customer-Focused Culture
    • Hierarchy Culture
    • Market-Driven Culture
    • Purpose-Driven Culture
    • Innovative Culture
    • Creative Culture
  • Our Takeaway

What Is Company Culture?

Simply put, company culture is the way employees interact with each other. It’s all about the shared values, beliefs, company mission, leadership style, and other practices that define a company.

Company culture is the result of decisions made over time. If your company has a strong culture, workers are more likely to understand specific behaviors and act accordingly. However, not all types of work culture are positive. While a positive company culture motivates employees and helps them be productive, a negative one can lead to employee turnover and poor performance.

Types of Company Culture

Every workplace has a distinct business culture that makes them unique. However, they can all be boiled down to eight basic types.

Adhocracy Culture

An adhocracy culture is flexible and adaptable, putting creativity and innovation as its top priority. Employees are encouraged to take risks and experiment with new ideas. However, it can also lead to a certain amount of chaos, as different employees pursuing different goals can sometimes create confusion. Nevertheless, an adhocracy company culture is most effective if you’re trying to push the limits of the current market.

However, many tech giants, such as Google, Facebook, and Apple, welcome an adhocracy culture.

Clan Culture

In many companies, employees form close bonds with their colleagues, developing a sense of camaraderie and shared purpose. Generally, strong social ties and a high level of trust are common traits of clan culture companies.

Similar to members of a clan, employers and workers typically share similar values and beliefs, and they are fiercely loyal to one another. For example, in a hospital setting, nurses may form close relationships with their fellow employees to cope with the stress of their job.

Customer-Focused Culture

A customer-focused culture always puts customer experience at the forefront. Every decision is made with the customer in mind, and their satisfaction is always the goal. To create and maintain a customer-focused culture, companies need to make sure that all employees are on board.

Customer service representatives must be friendly and helpful, salespeople must be knowledgeable and not pushy, and management must be accessible and responsive. Creating a customer-focused culture can be a challenge, but it’s worth undertaking. When customers feel valued and appreciated, they’re more likely to remain loyal and continue doing business with your company.

It’s true that customer satisfaction is vital for every company, but don’t forget to value and nurture your employees as well.

Hierarchy Culture

If decision-making authority is vested in those at the top of the organization, you’re working in a company with a hierarchy culture.

This type of culture can be effective in ensuring that tasks are carried out efficiently and goals are achieved. However, hierarchy culture in these organizations can also lead to a feeling of distance between employees and management, which can stifle creativity and innovation. 

For this reason, organizations need to encourage open communication and collaboration between all levels. In addition, employees should have opportunities to voice their ideas and suggestions. By creating a more inclusive culture, organizations can tap into the full potential of their workforce and create a more positive and productive workplace.

Market-Driven Culture

In today’s business world, the term “market-driven culture” is often used to describe the trend of companies putting profit margins and shareholder value above all else. This can be seen in everything from outsourcing and layoffs to focusing on short-term gains rather than long-term investments.

While there are some benefits to this approach, it also has a number of drawbacks. Perhaps market-driven culture can lead to a ruthless, cutthroat environment where employees are constantly under pressure to produce results. This can create a lot of stress and anxiety, which can ultimately lead to burnout. Market-driven cultures also foster a sense of competition rather than cooperation, causing isolation and loneliness.

Purpose-Driven Culture

As the business world continues to evolve, more and more organizations are placing a greater emphasis on creating a purpose-driven culture.

Companies using a purpose-driven culture primarily focus on their mission and values aligned with the needs and aspirations of their employees. In such a culture, employees feel a strong sense of connection to their work and are motivated to achieve both personal and company success.

Many benefits stem from creating a purpose-driven culture in the workplace, including increased employee engagement, higher levels of creativity and innovation, and improved retention rates. However, it’s important to note that creating such a culture requires intentional effort and involvement from all levels of the organization. This can’t be achieved overnight. Instead, it must be built over time through a shared commitment.

Innovative Culture

An innovative culture welcomes creativity and fresh thinking in the workplace. This type of environment can lead to the development of new products, processes, or services and help create a competitive advantage for a company.

Employers need to encourage their workforce to think outside the box and take risks. This may involve giving employees the freedom to experiment and fail, as well as providing opportunities for employees to collaborate with each other. So, it’s the employer’s duty to create an environment that supports creativity by providing resources such as time, money, and space.

Creative Culture

Many companies have started to realize the benefits of a creative culture in the workplace. A creative culture encourages employees to think outside the box, be innovative, and take risks. This can lead to new products, services, and processes that give a company a competitive advantage.

A creative culture can encourage teamwork and camaraderie among employees. When people feel like they are part of something bigger, they are more likely to be engaged and motivated at work. Finally, a creative culture can attract top talent. Candidates are looking for workplaces that offer opportunities for growth and creativity. By creating a creative culture, companies can position themselves as an employer of choice.

Types of Company Culture: Our Takeaway

Think of company culture as the personality of a business. Whether they choose an innovative approach or prioritize customer experience as a part of their policy, company culture says everything you need to know about an organization.

Before deciding to work for a specific corporation, make sure to check out their website, do your research, and ask about the company’s values during your job interview.