Career Development

4 Common Types of Corporate Culture

September 30, 2021

Every company has its own type of corporate culture defining the organization’s beliefs, standards and values. If you are in the market for a career or job change, it's important to know what to look for in a company's corporate culture. This information can help you decide if you will be a good fit and feel comfortable within the organization. In this article, we discuss what corporate culture is and its most common types.

Why is corporate culture important?

Corporate culture, often called “organizational culture,” is important because it affects how you feel and perform in a work environment. It includes a company's values, ethics, vision, work environment and behaviors. If these factors align with your own beliefs and work style, you'll be more likely to feel satisfied at work.

For example, some corporate cultures are more laid back than others. Some employees enjoy this lack of structure whereas others may need more organization to be productive. A more hierarchical corporate culture may appeal to you if you like defined roles and managerial levels.

Good company culture can lead to increased fulfillment, motivation and productivity. When you feel comfortable at work, you're more likely to feel good about your job. That's why it's important to find the type of corporate culture that fits your preferences.

Related: 8 Reasons Why Organizational Culture Is Important

Types of corporate culture

Every organization has its own corporate culture but there are several types you may recognize during your job search. Some companies may fit into a combination of these corporate cultures instead of only one.

Here are four different types of corporate culture:

1. Advocacy culture

Companies with an advocacy culture focus on change, risk and innovation. They value employees who think creatively and offer new ideas. These companies are always thinking ahead and developing new products. Strategy and brainstorming sessions are encouraged to share ideas and move the company forward.

Companies with advocacy cultures are often managed by effective leaders willing to work beyond the status quo. They want to provide innovative services or products to the marketplace. This type of culture is common in the ever-changing tech industry where new products are developed and released on a regular basis.

Related: How To Create an Innovative Culture at Work

2. Clan culture

Companies with a clan culture, also known as “family culture,” are team-oriented, action-oriented and embrace change. The happiness and job satisfaction of employees are the top priorities for organizations with a highly collaborative work environment. These companies value each individual and seek feedback and open communication from employees.

Clan culture is often paired with a horizontal management structure, breaking down barriers between the C-suite and employees and encouraging mentorships. Management typically believes happy employees will work hard to make their customers happy. This type of culture is most popular with startups and smaller or family-owned companies.

Related: 34 Words Describing Company Culture

3. Hierarchy culture

Companies with a hierarchy culture follow traditional business practices with a clear line between management and employees. They function within a risk-averse work environment with well-defined processes. These kinds of businesses typically have a rigid structure including defined work hours and even a proper dress code. The focus is on day-to-day operations rather than employee relations or feedback.

Hierarchy culture adheres to traditional corporate structures with multiple management levels. All decisions are made at the C-suite level. This type of culture can be found in a variety of businesses ranging from banking to fast-food restaurants. The culture is also slow to change, making it difficult to adapt new technologies and business practices.

Related: What Is Business Hierarchy? Definition and Examples

4. Market culture

Companies with a market culture make profitability and market share a priority. It is the most aggressive and competitive type of corporate culture. They are results-oriented organizations that focus on the bottom line and financial success rather than employee satisfaction. These companies focus on meeting quotas, reaching targets and getting results.

Market culture requires all employees to share an objective of benefiting customers or shareholders. In this culture, the company’s business goals come first. This type of culture tends to favor larger companies and industry leaders.

Read more: How To Change Company Culture in Your Organization

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