Organizational Iceberg - Company Culture And Business Management

what is an organizational iceberg business management structure

94 percent of all business executives believe that a distinct workplace culture is essential for business success. For most of these executives, establishing a culture that fosters employee engagement and productivity is the biggest organizational challenge they face.

The truth is every business has an organizational culture of its own. For some organizations, that organizational culture is healthy and dynamic. For others, it’s erratic and dysfunctional. 

Regardless of the culture an organization has, only a tiny part is visible. The majority of leaders only know a tenth of what’s happening in their organization. It’s best understood as an organizational iceberg.

In today's post, we tell you all you need to know about an organizational iceberg. We'll let you know why improving an organization's existing culture is such a huge challenge. Most importantly, we'll suggest a few tips on improving organizational culture.

Read on to learn more about an organizational iceberg means for your business management and company culture.

What Is an Organizational Iceberg?

Each organization is like a puzzle that has many little pieces that form a whole. According to many organizational culture articles, leaders usually notice the visible parts. They often fail to recognize the bulk that lies underwater.

But behind the daily veneer, there’s how an organization feels, thinks, and acts. A leader’s ability to recognize all of these aspects is key to the organization’s long-term sustainability.  

Only when leaders understand what’s really going on in their companies can they start to implement necessary changes to their organizational culture.

Levels of an Organizational Culture

A company’s organizational culture is much more than what is immediately visible, as any topic on culture will tell you. Like an iceberg, the largest chunk of what drives your company is unseen and mostly inaccessible. It’s far below what everyone in your organization consciously thinks about. 

For a clearer understanding of organizational culture, let’s look at the three levels that constitute it:

Visible Artifacts  

Visible artifacts refer to all the overt, tangible, or verbally identifiable elements in your organization. 

They include the architecture, furniture, staff dress code, daily buzz, and status quo in your organization.

You’ve probably heard of the popular catchall “The way things are done around here”. It perfectly exemplifies visible artifacts of an organization. 

Among the indicators of problems at this level are:

  • A high employee turnover rate
  • Disengaged employees
  • Poor business performance

Espoused Values  

Espoused values refer to a company’s stated values and rules on how people should behave within the organization. These values have to do with how members of an organization represent it and to themselves and to other people. 

Typically, organizations express their espoused values in official philosophies as well as public statements of identity. These values can be what the company wants to become in the future. When there are problems at this level of organizational culture, you’re likely to see:

  • Stagnant innovation
  • Underdeveloped leadership
  • Frustration with existing processes

Shared Tacit Assumptions 

These are the deeply embedded behaviors that are usually taken for granted in an organization. Such behaviors are often unconscious, but they make up the essence of an organization's culture. Because they're so deeply integrated into the office dynamic, members usually don't recognize them from within.

Indicators of problems at this level include:

  • Culture and strategy that are misaligned
  • Unclear values 
  • Resistance to change

These issues can be significantly damaging to your performance and sustainability as an organization.

Challenges in Changing Organizational Culture

Your organizational culture is one of the top factors that determine whether your company will achieve its goals or not. Successful companies usually have a healthy culture that enhances growth and productivity. 

But what if you’re in a company whose organizational culture is pulling you down as a business?  As a leader, it’s your responsibility to find ways to transform that culture, otherwise the entire organization will continue to struggle.

Unfortunately, changing the culture of an organization is often easier said than done. Why? Here are three reasons:

Your Current Culture Is Already Strong

The biggest reason leaders struggle in instituting cultural change is that the existing organizational culture is already deeply rooted. That organizational culture may not be actually supporting the values, mission, and strategy, but it’s pervasive and powerful. 

Members of an organization usually unconsciously embrace a set of beliefs, assumptions, priorities, and values. There are traditions, rituals and power structures that are very intricate. It’s the organization’s DNA, and changing that can be an uphill task.

People Generally Resist Change

The vast majority of change initiatives never succeed. That’s because most people prefer to stick to what they’re already familiar with. 

Only change efforts that have been planned well and managed carefully succeed. Even then, patience and commitment are necessary.

Most Leaders Don’t Know What They Need to Change

Just like an iceberg, the biggest chunk of organizational culture lies beneath the surface. That’s what makes crafting an effective change management process so difficult. 

The fact is what you know about your organization’s culture is little compared to what you don’t. Elements of an organization’s culture develop organically, and they influence members’ behavior without their knowledge. 

Tips on Changing Organizational Culture

Changing organizational may be a difficult endeavor, but it can be done. Here are a few guidelines:

Ask Why More Often

Keep asking why things are done in a particular manner. If you’re told it’s because that’s how things have always been done in that organization, probe further. The aim here is to get to the root of what causes the culture in this organization tick.

Get Personal 

Examine how the personal values of your leadership team are serving or harming the organizational culture. Find out whether these personal values are aligned with the organization’s values. 

Seek Outside Help 

Find a professional from the outside who's knowledgeable about the concept of organizational culture, such as this company. Choose members from your team to have a structured and facilitated discussion about your culture with the professional. Focus on issues in your current company culture that you’d like to fix.

You Can Improve Your Organizational Culture Today

An organizational iceberg can sink a business if the leaders don't take the time to find out what's beneath the surface of their company culture. But once you recognize the issues at the different levels of the organizational iceberg, you can appropriately address them and keep your business in safe waters.

Would you like to read more interesting articles on business management? Please explore the HR and Career sections of our Bootstrap Business Blog for additional management advice.

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