Without leadership, there is no organizational culture. Without culture, there is no corporate leadership either. So what came first and what is the relationship between the two concepts? What is the role of the leader in the cultural transformation of the company?
Let’s get to the point.
Relationship between culture and business leadership
Knowing the definition of these concepts is a mandatory step to understand their relationship. On the one hand, corporate culture is the set of values, beliefs and norms that guide the behavior of people in a company. On the other hand, business leadership is the ability to lead and motivate others to work together toward achieving the company’s goals. Leaders must be aligned with the culture and be able to transmit those values to others.
Now, leadership is an important part of a company’s culture: leaders set the tone for the culture, they model the behavior expected of others, and the culture is influenced by the way it is managed and decisions are made.
How culture affects leadership
Each company has its own culture, tradition and ways of leading, which determines the way decisions are made on a day-to-day basis. And although some qualities of every leader are universal (empathy, active listening, communication), each organization has its own style of working.
The truth is that a company’s culture can affect leadership in a number of ways. For example:
- If the culture encourages individualism, that company’s leaders are likely to be more individualistic.
- If a company’s culture is very competitive, leaders are likely to be expected to be very competitive.
- Culture can also affect the leadership style that is most effective. For example, if the culture is very conservative, leaders are likely to be expected to be more conservative.
A well-managed company culture fosters the development of the company with responsible leaders, connects culture and company leadership to motivation, and generates greater employee satisfaction. Ultimately, the relationship between leader and culture directly impacts the functioning of the organization.
Culture or business leadership? The opinion of the experts
To answer this question it is important to take into account the opinion of some experts in business culture and leadership, such as those collected in the study on The impact of organizational culture and leadership in companies (University of La Rioja):
- Cid Nardy (1999). “Culture is born when an organization is founded. It is a process that is related to the characteristics of the founder, to the elements of the culture of the first collaborators, to the cultural systems of origin, to the elements of the predominant cultural systems of the environment at the time of the foundation, to the civilizing process, its evolution and the relationship with the market, competition and others”.
- Chiavanato (1999). “Culture equals the organization’s way of life in all its aspects, ideas, beliefs, customs, rules, techniques, etc. Therefore, the essence of culture is determined by the degree of autonomy, freedom and loyalty between employees and managers, as well as the way employees and customers are treated”.
- Schein (2001). “Culture is generated by the certainties of leadership, as well as approved by the members of the organization as they are concretized. The leader’s role is different in each evolutionary stage of a company. When a company begins to grow, it seeks to stabilize and propagate the culture it believes to be the basis for success.
In any case, in order to change the corporate culture, it is necessary to know what is expected of its employees and senior managers.
So, was it culture or business leadership first?
Culture is the DNA of the company. And the leader is key to its cultural transformation. He or she is the one who drives the purpose and fosters the values. Therefore, we can affirm that the role of leadership is key in determining culture.
In turn, the leader requires a culture to be successful, to make good decisions, to communicate with employees, to define growth strategies and to achieve better results for the company. Culture is a kind of guide on which the leader relies to establish the company’s values and identity, as well as to know what to expect from employees and how to act at any given moment.
This brings us back to the question at the beginning, which came first, corporate leadership or culture? In reality, corporate culture requires leadership in order to be consolidated, but they are two key factors that end up working in parallel.
To develop culture, organizational development is necessary. And for that development, we need to improve our leadership capabilities. Culture is a variable that can be modified to improve performance, a means to achieve change.
Coaching, the undisputed key to business leadership and cultural transformation
When we talk about transforming the company’s culture, we are referring to transforming the way team members think and act, something that requires a change of habits and the development of their skills. In this context, business coaching has become the most solid and lasting way to achieve the change of habits aligned with the company’s objectives:
- Helps leaders improve their skills and performance.
- Improves the business leader’s self-confidence.
- Encourages better business leadership decision making.
- Increases motivation and improves efficiency.
- Increases employee productivity.
- Improves stress management and the leader’s own quality of life.
On the one hand, coaching can help business leaders improve their skills and competencies so that they can achieve their objectives and goals. It can also help them identify areas of opportunity and make strategic decisions for the success of the company.
On the other hand, coaching can help employees improve their performance, achieve their goals, develop greater confidence in themselves and their skills, and better understand the company’s culture in order to adapt to it.
Remember that every business transformation comes with a cultural change. And the leader is the ideal role to achieve this transformation. At first, it is an individual commitment to understand the change and the personal impact, but then it becomes an organizational decision.
Therefore, he or she is a key player in the cultural transformation. The one who communicates and transmits the new desired behaviors and beliefs.
Starting from a solid business leadership is key to implement a culture that works. Ask for more information on how to improve your leadership skills and therefore the company’s culture through coaching!