What does "Organizational Culture" encompass?

Organizational culture encompasses the shared values, beliefs, and practices that characterize an organization. It essentially defines how members of the organization interact with each other and with stakeholders outside the organization. This culture is evident in the organization's work environment, communication style, decision-making processes, and overall mission. It significantly influences employee behavior, engagement, and the overall effectiveness of the organization.

The shared values within an organization guide the actions and decisions of its members, creating a unified approach to achieving goals. This cultural framework shapes not only how employees feel about their work and each other but also affects how the organization is perceived externally. In essence, organizational culture serves as the backbone of the organizational identity and cohesion.

In contrast, while policies and procedures provide a structured framework for operations, they do not solely capture the essence of an organization's culture. Financial performance indicators relate to the organization's economic outcomes and do not reflect the intangible aspects of culture. A specific management style may influence organizational culture but does not encompass the broad range of shared values and practices that define the culture itself. Thus, emphasizing shared values and practices is key to understanding what organizational culture truly represents.