Assessing your institution's culture

RMA Journal, The, Dec, 2003 by Kathleen D. Miller

"Inside-out thinking" applies to people inside an organization who expect their actions to be magically understood by customers and others ... when often they don't understand those actions themselves. You can see the potential for problems. Outsiders can help organizations understand why they do what they do and how to change their culture for the better.

Organizational culture affects nearly all company endeavors, from the execution of strategy to the acceptance and implementation of new processes. The culture is likely to influence risk managers' capacity to form partnerships with the businesses, to participate in the development of business strategy, and to introduce risk frameworks into the company. Organizational culture assessment, then, should become a fundamental part of any strategy.

Culture Defined

Practically speaking, organizational culture is "the way we do things here." Culture is composed of the values, basic assumptions and beliefs, and ways of working that members of the organization share. Since these beliefs generally function at an unconscious level, they tend to be taken for granted by organizational insiders. Culture tends to be felt by those within it, yet remains invisible.

While it's rather obvious that organizations vary in their look and feel, the nature of these differences often remains elusive and difficult to define. Therefore, assessment of the culture is difficult at best. Nevertheless, even the invisible can be brought to light with the right assessment process.

Insider and Outsider Roles in the Assessment Process

Thorough and useful assessments of an organization's culture generally require the efforts of those who are inside the culture and live it every day, partnered with the more objective perceptions and observations of someone outside the culture. The outsiders are more likely to observe things that insiders take for granted. They can look for the patterns in behaviors and the surprises or unexpected events. The insiders can attempt to help the outsiders decipher what the events and surprises mean.

The primary role of the outsiders is to gather data concerning what goes on in the organization through systematic observations. They collect information through interviews and focus groups, and they review strategic plans, news releases, internal memos, newsletters, and other company documents. In addition, they should attend a few organizational functions, such as meetings and celebrations. In most cases, they should spend some time within the culture, chatting with people informally in the lunchroom, break room, or wherever groups gather. They primarily seek to note surprises--unexpected behaviors or events that provide fertile data for interpreting what makes a culture unique.

The primary role of the insiders is to point the outsiders in the right directions for collecting data and to assist with its analysis and interpretation. While the outsiders will notice things that the insiders might take for granted, only those who work within the culture can really clarify or validate the meanings of the events and surprises.

Assessment Targets

Organizational culture is not a tangible entity. Rather, culture is experienced in a variety of ways. While some of the markers of an organization's culture are quite visible, others are below the surface and somewhat difficult to unearth. Edgar Schein, in his 1992 book Organizational Culture and Leadership, described three levels of cultural markers, as seen in the table at right.

A sound assessment process will incorporate all three levels into the data collection plan. While values and assumptions are sometimes difficult to access, one of the most valuable contributions that assessors can make is to bring them to the surface and work with insiders to analyze how they contribute to the cultural picture.

For example, risk managers certainly would want to uncover the organization's values and basic assumptions about risk in their culture assessments. Risk managers need to know how risk is defined in the culture, as well as how it is viewed. Since basic assumptions operate like realities, the risk manager in risk-averse cultures has challenges that differ from those who function in cultures that embrace risk as a normal part of business strategy.

Assessment Process Steps

Step 1--Determine the purpose of the cultural assessment. Exactly why do you want to learn more about the culture? Since the information to be gathered can be quite extensive, target your data collection by focusing on an assessment goal.

Have you identified problems that must be addressed? Or do you see new opportunities that you suspect would require a culture change? Are you interested in assessing your current culture's ability to support a new organizational strategy or direction?

For example, perhaps you are considering establishing a more robust risk management strategy that would require tighter integration of the processes into the overall structure of the organization. In this case, the culture assessment would be targeted toward all aspects of the culture that could affect your ability to carry out this strategy.