How Corporate Culture Affects Productivity

Corporate culture affects productivity when habit-forming systems reinforce poor behaviors and beliefs.

Up to now I have discussed how changes to the resources can change the output and affect production and productivity. But, there are two other sources that can have a positive or negative impact on production and productivity. The first is cultural and the second is technological.

Cultural influences refer to employee and management behaviors that are contrary to productivity. Such a behavioral climate can foster beliefs that establish a culture that tolerates waste. Changing the culture of an organization can often be difficult, but it can change!

Technological problems affect the efficiency and effectiveness of a work process. If allowed to fester they will reduce the output of a process. Efficiency refers to time, and Effectiveness refers to the quality of work. For example, an IT Support person can answer a call quickly but the information provided is incorrect. In this case, the person was efficient but not very effective.

How Does Corporate Culture Affect Productivity?

Every organization has an inspirational purpose for being in business – if not it should! It also has a vision it seeks to fulfill tomorrow. An organization’s mission is to use its resources in an effective and efficient way on its way to fulfill its vision. When resources are poorly used, the cultural disposition of the organization will slide and get worst. Since people are creatures of habit, the way people work is the most habit-forming mechanism in a company.

When work processes are unproductive the output is seriously affected. To keep up the output the work process will draw more resources and increase the cost to produce a product or service. This includes longer work hours and more frequent inspection. This causes higher levels of emotional stress for the worker. When management tolerates unproductive processes, the people who do the work become tiresome. The enjoyment of the tasks performed during the course of their work is no longer enjoyable. This leads to an increase in negative behaviors reinforcing a belief system that tolerates waste. If this belief system continues to fester then production output will suffer. Soon quality will get worse and customers will receive late shipments. This leads to customer dissatisfaction – and – more so when told a price increase is on the way!

How Corporate Culture Affects Productivity

How do you change Behaviors and Beliefs?

Create a broad-based initiative to improve productivity. Having a common approach to productivity improvement assures alignment between workers and management.

Get the people who do the work to improve the way they work. Provide workers with the necessary skills to visualize, and document the sequence of their work. Have them use their new-found tools and knowledge of the job to engage work improvement projects. When workers can visually organize the facts for all to see all that’s needed is common sense to improve productivity. This will improve the emotional disposition of workers and drive broad based cultural change.

How Corporate Culture Affects Productivity

Workers as a Resource

As a last note, I have worked for many organizations that have the best productivity and quality in the markets they serve. In most cases, the technology they use to produce their products is more than 50 years old! How did they get such improvements in productivity? They invested in their people and taught them tools and techniques to understand the way they work. They then practiced –  Engagement through Involvement.