Houston-based Apache Corp. has become one of the best performers in the independent oil drilling business because it has fashioned a culture that values risk taking and quick decision making. Potential hires are judged on how much initiative they’ve shown in getting projects done at other companies. And company employees are handsomely rewarded if they meet profit and production goals.39 Because an organization’s culture constrains what they can and cannot do and how they manage, it’s particularly relevant to managers. Such constraints are rarely explicit. They’re not written down. It’s unlikely they’ll even be spoken. But they’re there, and all managers quickly learn what to do and not do in their organization. For instance, you won’t find the following values written down, but each comes from a real organization:

• Look busy even if you’re not.

• If you take risks and fail around here, you’ll pay dearly for it.

• Before you make a decision, run it by your boss so that he or she is never surprised.

• We make our product only as good as the competition forces us to.

• What made us successful in the past will make us successful in the future.

• If you want to get to the top here, you have to be a team player.

The link between values such as these and managerial behavior is fairly straightforward. Take, for example, a so-called ready-aim-fire culture. In such an organization, managers will study and analyze proposed projects endlessly before committing to them. However, in a ready-fire-aim culture, managers take action and then analyze what has been done. Or, say an organization’s culture supports the belief that profits can be increased by cost cutting and that the company’s best interests are served by achieving slow but steady increases in quarterly earnings. In that culture, managers are unlikely to pursue programs that are innovative, risky, long term, or expansionary. In an organization whose culture conveys a basic distrust of employees, managers are more likely to use an authoritarian leadership style than a democratic one. Why? The culture establishes for managers appropriate and expected behavior. You can see this in action at Winegardner & Hammons, a hotel management firm, where company leaders have built a “Winning Workplace Culture” with four characteristics: a positive work environment in which managers are encouraged to make employees feel cared for and valued; an employee selection process that encourages managers to focus on selecting the “right” employees; an employee engagement program that’s based on training managers so they have the right skills, knowledge, and experience to nurture an engaging work environment; and a strengths-based workplace in which managers continually reinforce employees’ strengths. What has this cultural focus led to? Thirty-four percent lower employee turnover and 11 percent higher profitability.40 That’s the kind of outcomes that can be achieved if you pay attention to your organizational culture and if managers recognize appropriate and expected behavior in that culture.

As shown in Exhibit 2–5, a manager’s decisions are influenced by the culture in which he or she operates. An organization’s culture, especially a strong one, influences and constrains the way managers plan, organize, lead, and control.

Exhibit 2–5

Managerial Decisions Affected by Culture