What role do leaders play in shaping organisational culture?

Leadership within an organisation is not just a position; it's a profound influence that extends far beyond the boundaries of a job title. Leaders, whether they are executives, managers, or team leaders, wield an exceptional level of influence over the organisational culture. They are the architects and custodians of the intangible essence that shapes the workplace environment and guides the behaviour of every member of the workforce.

Leadership Impact

In this exploration of the role of leaders in shaping organisational culture, we will delve into five fundamental facets that elucidate the far-reaching impact of leadership on an organisation's culture.

1. Setting the Tone

Leaders are often the most visible representatives of an organisation's culture. Their behaviour and communication style become a model for employees to follow. If leaders prioritize values like transparency, accountability, and respect, employees are more likely to adopt these behaviours in their interactions. Conversely, if leaders exhibit behaviours contrary to the desired culture, it can undermine trust and create dissonance within the organisation.

A study by Sosik and Jung published in the "Journal of Leadership & Organizational Studies" (2002) titled "Workplace Leadership and Group-Performance: The Mediating Effects of Transformational Leadership, Interactions, and Subgroup Dynamics" explores how leadership behaviour, especially transformational leadership, sets the tone for the organisational culture by influencing employee attitudes and behaviour.

Leaders set the tone of the organisational culture through their behaviour and communication. Their actions and words serve as a guiding beacon for employees to understand what is expected, accepted, and valued in the workplace.

2. Vision and Values

Leaders act as the living embodiment of the organisation's vision and values. When leaders authentically adopt and exemplify these principles, they send a powerful message throughout the organisation. Employees look up to their leaders as role models, and the alignment between leaders' actions and stated values reinforces the culture's credibility. If leaders deviate from these principles, it can create confusion and cynicism among employees.

In the book "Built to Last: Successful Habits of Visionary Companies" by James C. Collins and Jerry I. Porras (1994), the authors discuss how enduring companies are led by leaders who not only articulate a clear vision but also embody the company's core values. The book draws from a comprehensive research study on visionary companies.

Leaders articulate and embody the organisation's vision and values. They are the living embodiment of the aspirations and principles that define the organisation's purpose and mission. Through their actions, they breathe life into these guiding ideals.

3. Decision Making

Leaders make decisions that have far-reaching implications, not only in terms of strategy and operations but also for culture. Decisions that prioritise ethics, inclusion, and employee well-being reinforce a culture of integrity and care. Conversely, decisions that disregard these principles can undermine trust and cultural cohesion. Leaders must be aware that every decision carries cultural significance.

The article "How Leaders Impact Organizational Performance" by D. Scott DeRue and Christopher G. Myers in "The Academy of Management Executive" (2014) discusses the significant influence leaders have on organisational culture through their decision-making processes and the consequences of these decisions on culture.

Leaders' decisions are not mere transactions; they are reflections and reinforcements of cultural norms. The choices leaders make, whether strategic, ethical, or operational, send powerful signals about the organization's priorities and its commitment to its cultural foundations.

4. Change Agents

Leaders play a crucial role in guiding an organisation during periods of change, be it a merger, a restructuring, or a shift in strategic direction. Their approach to change can either inspire or demoralise employees. Effective leaders communicate the need for change, involve employees in the process, and offer support during transitions. Their leadership during these times can shape the resilience and adaptability of the culture.

The Harvard Business Review article "Leading Change: Why Transformation Efforts Fail" by John P. Kotter (1995) highlights the critical role of leadership in managing change within organisations and how leaders' actions and communication during change processes can shape the culture's response to change.

Leaders play a critical role in driving change and cultural adaptation. Their approaches to change profoundly affect how the organisation navigates cultural transitions.

5. Employee Engagement

Effective leaders engage with employees on a personal and professional level. They promote a culture of inclusion and respect, valuing diverse perspectives and creating an environment where each individual feels heard, valued, and empowered.

The research paper "Transformational Leadership, Transactional Leadership, Locus of Control, and Support for Innovation: Key Predictors of Consolidation of Organizational Change" by Llorens-Montes et al. in the "Journal of Leadership & Organizational Studies" (2006) examines how leadership behaviours, especially transformational leadership, impact employee engagement and support for innovation, which are key aspects of organisational culture.

Leaders are at the forefront of daily engagement with employees. How they interact, listen, and respond to their teams profoundly affects morale and employee commitment. When leaders promote an inclusive environment where diverse perspectives are valued, it contributes to a culture of innovation and collaboration. Conversely, leaders who are distant or dismissive can hinder employee engagement and weaken the cultural fabric.

In essence, leaders are cultural stewards, and their actions, decisions, and interactions set the cultural compass for the entire organisation. Their role goes beyond merely managing tasks and people; they are custodians of the organisation's soul. By understanding the influence they wield and aligning their leadership with the desired culture, they can help shape an organisation that thrives, adapts, and inspires its workforce.

References

Sosik, J. J., & Jung, D. I. (2002). Workplace Leadership and Group-Performance: The Mediating Effects of Transformational Leadership, Interactions, and Subgroup Dynamics. Journal of Leadership & Organizational Studies.

Collins, J. C., & Porras, J. I. (1994). Built to Last: Successful Habits of Visionary Companies.

DeRue, D. S., & Myers, C. G. (2014). How Leaders Impact Organizational Performance. The Academy of Management Executive.

Kotter, J. P. (1995). Leading Change: Why Transformation Efforts Fail. Harvard Business Review.

Llorens-Montes, F. J., Ruiz-Moreno, A., Garcia-Morales, V. J., & del Mar Fuentes-Fuentes, M. (2006). Transformational Leadership, Transactional Leadership, Locus of Control, and Support for Innovation: Key Predictors of Consolidation of Organizational Change. Journal of Leadership & Organizational Studies.