What is clan culture in the workplace?

The definition of clan culture is a workplace that’s collaborative and feels like a family — it’s one of the main types of organizational cultures, with the other examples being adhocracy, hierarchy and market. Team members are typically very close, similar to the members of a family or clan, and tend to work well together. It focuses on mentorship, teamwork and collaboration and typically has a horizontal organizational structure. You usually see this structure in smaller and medium-sized companies.

Common characteristics of a workplace with a clan culture

To better understand the clan culture definition, consider these common characteristics of workplaces with a clan mentality:

• Teamwork: The family-like feeling encourages a high level of teamwork with colleagues often helping each other out. This comes from the close relationships and trust between team members.
• Close-knit feeling: People in the organization often know each other on a personal level and might socialize frequently outside of work. They feel comfortable with one another and have a strong sense of loyalty.
• Shared values and goals: The team rallies around a common vision and shared values.
• Focus on employees: Companies with a clan culture tend to focus on the well-being of the employees with a safe, nurturing environment.
• Less structure: Clan culture organizations are usually less formal without a well-defined hierarchy or roles.
• Shared decision-making: Workplace decision-making is often decentralized, with all employees having the autonomy to make decisions.

Pros of clan culture

Why would you want a clan organizational structure for your company? Here are some key benefits of this style.

1. Employee satisfaction

Clan culture typically creates a positive organizational climate for your employees. It’s usually an employee-focused environment with positive relationships between staff members, which makes work more enjoyable. When employees are happy, they tend to be more productive and stick around longer.

2. Effective communication

When team members know each other well, they usually communicate effectively. They learn to interact differently with specific team members based on their personalities. The team also has a lot of shared history and common goals in mind, so they understand where they’re coming from. Just like a real family, the team members might feel more comfortable sharing openly and honestly, potentially generating better ideas. Plus, management tends to listen to employee feedback more, which could result in positive changes.

3. Flexibility

The casual, flexible environment makes it easier for you to shift gears when needed. That flexibility can make your organization more adaptable so you can stay on top of industry changes for increased competitiveness.

4. Collaboration

The collaborative environment can help combine talents and expertise to maximize your results. Individuals feel like their contributions are valued, yet everyone works as a team with a common goal. This can increase productivity and improve outcomes for your organization.

5. Employee loyalty

You might not be related, but your team feels like a family, which means you have each other’s backs. Employees tend to be more loyal to one another and the company. They’re invested in making the work family succeed, so they might work harder to hold up their part in that. Loyalty can also help you improve your employee retention statistics, which gives your organization consistency and reduces hiring costs.

Cons of a clan organizational culture

While clan culture can create a positive work environment, it can also cause some disadvantages. Explore the possible pros to take steps to avoid them.

1. Lack of diversity

It’s common in a clan organizational culture for employees to be similar, which cuts down on workplace diversity. New hires might come from referrals from the staff, which continues the homogenous makeup of the staff. Adding diversity to your team can improve creative problem-solving, expand your perspectives and improve your reputation within the community.

2. Groupthink

Another potential problem with team members being similar and feeling loyal to one another is falling into groupthink. Your team might lack unique viewpoints or end up agreeing with one another to keep the peace. Breaking free of groupthink helps your organization be more innovative and competitive.

3. Difficulty for new team members

When you hire a new employee, they might feel like an outsider if you have a strong clan culture. It could take them longer to settle into the role or feel like a part of the team, which could affect their employee experience. Even if your team doesn’t intentionally leave them out, it can be intimidating to come into a close-knit team situation with so much shared history.

4. Nepotism

Hiring, in general, with a clan culture can cause some difficulties. It might be more likely to see nepotism in the workplace due to the family mentality. Offering jobs to friends and family of your current staff isn’t necessarily a negative if they have the qualifications needed for the job. However, you could end up missing out on outside talent that could strengthen your team.

5. Lack of authority and boundaries

The flat organizational structure means there’s less authority within the company. This can make employees feel more valued and give them more ownership, but it can also affect the direction of the company. When managers need to assert authority in a clan culture environment, the other team members might not take them seriously because of the lax rules and structure.

Experienced managers with authority can use their expertise to steer the organization toward growth. They’re also better equipped to take charge in a critical situation when the other team members respect their authority and know their boundaries.

6. Problems with decision-making

Along the same lines, decision-making can get messy in a clan culture. Giving everyone the autonomy to make decisions can create conflicting scenarios and inconsistency. Input from everyone on decisions isn’t always necessary or effective. Sometimes, you need team members with specific experience and expertise to make critical decisions.

7. Fewer leadership opportunities

Because of the horizontal structure and decentralized decision-making, organizations with a clan culture might offer fewer opportunities for leadership roles. People who naturally have a take-charge attitude might not find fulfilling leadership duties within this type of company. Your organization might also have less room for advancement if all roles are similar with no real hierarchy.

Supporting healthy clan culture

Fostering a clan culture can help you take advantage of the positives, but you might also need to address some of the negatives of this organizational culture type. Changing your organizational culture to make it more positive is possible with time and intention.

Create an employee-centric environment that supports well-being while still maintaining boundaries and an authority structure. Consider etablishing clear policies regarding decision-making to ensure consistency and hiring to avoid nepotism. Evaluating your culture regularly and identifying possible negatives can help you correct those issues and foster a more positive experience.

FAQs about clan culture

What are the other types of organizational culture like?

Adhocracy culture emphasizes risk-taking and innovation to be the first to create the next big thing. Market culture is a results-oriented environment focused on profitability and competition. Contributors are expected to meet goals, and the organization worries more about keeping external stakeholders happy than internal satisfaction. The most traditional is a hierarchy culture with a well-defined chain of command.

Why is organizational culture important?

Your organizational culture impacts how your employees feel, including their job satisfaction and productivity. It helps define your organization’s personality and how outsiders, including job seekers, perceive it. The culture you cultivate can affect success and how you get things done. For instance, some types emphasize innovation, while others prioritize stability and proven methods.

Do organizations have just one organizational culture type?

It’s common to have characteristics of different organizational culture types. Most companies have a primary culture type, but they might have elements of other types as well. For instance, you could mainly have a clan culture but also borrow elements of adhocracy culture, where you push innovation and individual creativity to keep your business at the cutting edge of the industry.