The Eight Different Types Of Company Culture

Every company has its unique culture. And the goal in today's corporate world is to create an ideal company culture where everyone thrives and customer satisfaction is assured.

Whether your company is a startup or a well-established business, it's important to foster a healthy and progressive culture. It can be the difference between success and failure.

Have you ever worked somewhere with a bad culture? It's not fun.

But how do you know if your company has a strong culture? And if it does, how can you make it even better? What do you consider a "good" company culture? And a "bad" one?

This article will explore the different company culture types, good company culture examples, and tips on how to know which company culture works for you. 

Let's get started!

What Are The 8 Types Of Company Culture?

We can describe culture as the set of beliefs and values held in high regard by a group of people. The culture of a company, on the other hand, is often described as the "way we do things around here." 

Company culture and values are what inform the way companies operate and what to expect from employees. It’s a huge part of employee retention, brand perception, and productivity.

While every organization has a culture, not all cultures are created equal. In fact, some are better than others.

A strong company culture can create a competitive advantage for your business by attracting and retaining top talent, aligning customer expectations with company goals, and building long-term relationships with your stakeholders. 

So, what are some types of company culture to consider? Here are eight common types of company culture:

1. Adhocracy Culture

It takes its name from the word, ad hoc which implies doing things quickly and impromptu. The central theme in this type of company culture is innovation and risk-taking. 

This company culture is common to top industry performers and promotes team participation. Companies that inculcate this culture are constantly in the quest to create innovative solutions before their competitors do.

This culture is replete with risk-taking and high rewards. 

Pros of adhocracy culture

• It drives innovation and resilience.
• Encourages employee creativity.

Cons of adhocracy culture

• This may create an environment that some employees are unable to keep up with.
• It involves a lot of risks and may result in losses after investment in products end up performing poorly in the market.

2. Clan Culture

In a clan culture, it's a family affair. It characterizes a workplace where employees function like a family. 

Companies that imbibe this culture type exhibit a high degree of collaboration and flexibility. In addition, communication is given top priority.

This company culture type fosters close interpersonal relationships and an efficient support system for employees. Company heads act in the capacity of mentors in contrast to the traditional position of stern figureheads. As a result, decisions are made much faster as there’s a reduced barrier between employees and managers.

Pros of clan culture

• Better learning opportunities amongst team members.
• Developed collaboration and communication skills.

Cons of clan culture

• Low innovation level; it's much harder to make decisions that don’t have the full support of other team members.
• The absence of a hierarchical structure combined with excessive collaboration may cause reduced productivity.

3. Customer-Focused Culture

Here, customers are the central focus of all company's activities and good customer experience is the goal. 

A company that operates on this model is willing to go the extra mile to make every customer satisfied. In these companies, employees are given free will to introduce ideas on improving customers' experience.

Practicing a customer-focused culture ensures a higher retention rate.

If you practice this type of culture, here are 10 valuable tips on keeping employees motivated. 

Pros of a customer-focused culture

• Employees show more commitment to work.
• Helps a company generate loyal customers.

Cons of a customer-focused culture

• Employees may feel unheard when the higher priority is always placed on customers.
• Good feedback on how to improve employee wellness may be lost in the cracks.

4. Hierarchy Culture

This is one of the oldest company culture types. Hierarchy culture helps to institute a stable, rigid, multilayer managerial structure in a company. 

This structure comprises directors, managers, supervisors, and also employees. The different positions at each level have specific roles to perform and there are laid down protocols for rule-making, decision-making, and accountability.

Pros of hierarchy company culture

• Makes a company more efficient and roles are well-defined.
• Creates a stable working environment.

Cons of hierarchy company culture

• There is little or no room for innovation due to the prevalence of groupthink.
• A rigid work environment can be stifling for some employees.

5. Market-Driven Culture

This culture prioritizes profit-making. It incorporates a result-driven approach to doing business.

A market-driven culture produces a highly demanding, competitive, and energy-intensive work environment. Having the company's products in the market quickly and frequently is the daily focus. This is done to outpace the competition and make more profits.

Pros of a market-driven culture

• Employees are motivated by profit margins and the bonuses associated with consistent profit-making. 
• Increase in the overall productivity of the company.

Cons of a market-driven culture

• An overly competitive workplace is toxic for employee growth and can cause burnout.
• Value clash; not all employees will believe that success is measured by monetary value.

6. Purpose-Driven Culture

This type of culture reflects the company's story and purpose. Companies are founded on shared culture & values. As a result, customers and employees who share these values are attracted to the company.

Profit-making is not the main focus, rather community support and brand story is given top priority. Companies that live by this culture exhibit this by aiding charities with similar ideologies.

Pros of a purpose-driven culture

• It leads to the development and sustainability of communities worldwide.
• Makes the company attractive to potential employees and increases the retention rate.

Cons of a purpose-driven culture

• Priority is not placed on profit-making. So, the profit margin may be less.

7. Creative Culture

The company thrives on coming up with creative ideas, solutions, and products. A creative company culture breeds ingenuity.

Employees working to develop products that give customers a whole new experience is a typical day. Novel ideas are the main driving force of this culture. 

Pros of a creative company culture

• Team members get to be their best selves while doing what they enjoy doing the most.
• Teamwork is encouraged. This fosters strong interpersonal relationships and ensures faster job outputs.

Cons of creative company culture

• The demand for new ideas puts a lot of pressure on employees and may cause burnout. 

8. Innovative Culture

Here, the company culture thrives on employees coming up with innovative ideas that enhance the current service delivery.

The ideas may leverage existing technology and make it better but the goal is to meet both existing and future customers' needs.

Pros of innovative culture

• It builds thinking ‘out of the box’ skills.
• Employees are given the liberty to discover and experiment with new ideas.

Cons of innovative culture

• The constant need for new ideas can result in an increased turnover rate.
• Increased mental fatigue

 Assembly has the best ideas on how to reward innovative employees. 

What Are Three Workplace Culture Examples?

If you've ever had a great office environment, you know what an amazing thing it is. 

It's much more than just being friendly to the people around you; it's about establishing an atmosphere where workers want to be. 

You may think that these kinds of relaxing and invigorating workplaces aren't possible—but they're out there.

Here are three examples of workplaces with great cultures to inspire you:

1. REI

REI prides itself on having one of the best workplace cultures. At REI, employees are highly valued. Their culture system can be described as purpose-driven; employees are encouraged to volunteer in their communities.

The company supports closely-knit relationships between employees and maintains open lines of communication between junior employees and senior executive members. 

This ensures that top executive members are in the know if there are any significant happenings.

2. Google

Over the years, Google has successfully raised the bar. Some elements of their unique culture are common features that characterize most startups. Their culture highlights adhocracy.

Google's company culture is replete with a lot of freebies. These bonuses range from employee vacations, free meals, gyms, cash bonuses, and also a friendly atmosphere. The resultant effect of all these perks is crop of an energized, talented and productive workforce.

3. Zappos

Zappos thrives on a customer-focused culture. Zappos believes that happy workers will lead to satisfied customers. Zappos invest immensely in team building and culture immersion. As a result, every employee is a full-fledged ambassador of the company's values.

At Zappos, employees are given leeway to come up with creative ways to make customers' experiences remarkable.

What Type Of Company Culture Are You Looking For?

Employers are no longer only satisfied with the level of expertise and skills. They are also interested in knowing how well you can fit into the company's culture and values.

If you don't fit into a company's culture, it's much more challenging to be fulfilled and satisfied in such a workplace.

Conducting a cultural assessment is also necessary before making a decision to join a company. A thorough culture audit gives you sufficient information about a company's culture, helping you make informed decisions.

A culture where you can fit in and thrive, is the company culture you should be on the lookout for.

Here’s how to set up culture rewards: Assembly | How to Set Up Culture Rewards

What Type Of Company Culture Do You Thrive In?

Employees will thrive in a company culture that aligns with their values, goals, and aspirations.

For instance, if you're used to functioning in environments where there are established chains of command, a hierarchical company culture will suit you better.

If you prefer to work in companies with flat organizational structures, adhocracy cultures like startup companies are good options. Having a penchant for volunteering makes you ideal for purpose-driven companies.

Improving Company Culture

Is it possible to improve office culture? Of course!

Companies do this by getting employees involved in something bigger than themselves.

Generally, company culture type determines workflow. So, good workplace cultures foster connection by encouraging collaboration, providing opportunities for growth, and encouraging employees to contribute to projects that matter.

Most significantly, company culture plays a vital role in the hiring process. Companies will hire candidates who share in their culture & values likewise good company culture attracts top talents. And potential employees will apply to companies whose value systems align with theirs.

Looking to develop or improve your company culture, sign up with Assembly to learn what workflows can help you begin!