Sunday, 27 December 2015

The Role Played by HR in Corporate Culture

Despite organizational culture may be influenced by the events taking place in the exogenous environment, the full accountability for shaping and developing corporate culture should invariably rest with an organization founder and management (Who develops, shapes and controls organizational culture?). The identification of the organizational values and of the type of behaviour individuals should exhibit in the workplace as well as the adoption of a metaphor aptly summarizing, explaining, reinforcing and in many respects linking all of these components together, so as to help individuals to establish a clear line of sight between them, should be in fact invariably regarded as a typical business founder responsibility.

Corporate culture is increasingly assuming a greater importance to employers, who are learning from experience that this cannot be merely considered as a discretionary organizational component, but rather as the founding pillar of organizational strategy, whose pursuance it is essentially intended to support, sustain and ease. Business culture requires hence the constant employer attention and active control in that its unintended derailment might produce irreversible, harmful effects on the execution of an organization strategy and ultimately upon the business stability.

Corporate culture, nonetheless, is not only exposed to the pressure coming from the exogenous environment, but it is indeed also sorely subject to the effects produced by the occurrences taking place in the endogenous environment. Amongst these, particularly detrimental to an organization may prove to be the deliberate or inadvertent employee attempt to alter or reinterpret the culture fostered by the business founder. This circumstance is likely to occur when a business founder leaves the organization and when the management diverts its attention away from the importance of consistently and continually fostering the culture originally developed and nourished by the business founder.

The executives and managers of an organization should be particularly cautious and vigilant from this point of view and should do whatever they can to prevent employees from influencing corporate culture, whether their reinterpretation or redefinition may threaten to derail the founder original vision and spirit. This may prove to be a definitely daunting feat to perform in that this employee initiative may be actually triggered by the business management incapability to firmly, convincingly and consistently foster and sustain, for a wide range of reasons, the existing culture. Yet, in some instances, managers might not become aware of the problem until it may be too late, let alone to resolve it once clearly emerged.

The role of HR
The first question to ask is whether HR actually has a role in corporate culture. Since culture is essentially concerned with the organizational values, shared beliefs, individual behaviour and the norms stemming from these, which definitely affect individuals at large, and HR is essentially concerned with people, it can be contended that HR unquestionably has a role to play in corporate culture.

This role, notwithstanding, should not be intended in the sense that HR should be fully involved in the definition and identification of the right or most suitable culture in that, as discussed earlier, this should be indeed invariably regarded as a specific founder duty. Being in charge of the development of human capital management practices and in its strategic advisory role, HR is in a commanding position to competently support an organization founder in developing his/her vision and translate this into corporate culture, but can hardly act as a substitute for the founder in this instance.

Taking heed of the circumstance that culture supports strategy execution, to which this should be hence strictly interrelated, it may be argued that corporate culture is somewhat of in between strategy execution and human capital management. It essentially contains the guiding principles for employers to attain competitive advantage over their competitors building on their most valuable resource, that is to say human capital. As such, corporate culture aims at fostering the behaviour which the employer considers as the most appropriate to achieve competitive edge and hence at developing the organization distinctive approach to “the way we do things around here.”

It can be hardly believed that an organization may achieve competitive advantage whether its management does not foster a corporate culture enabling the business to effectually execute its strategy. The success attained by the organization will contribute in turn to reinforce the individual belief that the behaviour endorsed by the management essentially represents a recipe for success. HR should thus, first and foremost, support the organization management so as to ensure that each manager properly fulfils his/her duty (Table 1 – The role of HR in Corporate Culture).

Table 1 – The role of HR in Corporate Culture

The role of HR is hence that to support managers in fostering the “official” corporate culture and avert that this may be reinterpreted or altered in any way by employees or by the business management itself. Whereas HR does not play a particularly significant, if any, role in culture development, it should play a remarkable role in ensuring that the business culture is correctly fostered and implemented within the organizational premises. The role of HR is hence to ensure and secure that the culture developed by the founder becomes and is perceived as strong by all of the employees.

Managers clearly play a remarkable role in the consistent enactment of a business culture and need hence to be supported by HR during the accomplishment of this particularly significant task. Newly appointed managers, especially whether recruited from the external environment, should be properly and thoroughly informed about the business culture’s features and implications. The role of HR can be regarded to this extent as that of the guarantor of an organization culture and of its consistent and proper enactment.

The responsibility of HR, notwithstanding, cannot be limited to secure that a business management appropriately fosters the culture developed by the founder; neither can be it intended as an exclusively advisory capacity. To be regarded as strong and genuinely shared by all the employees, irrespective of the beliefs and values underpinning this, corporate culture needs to be pervasive and reflected in every organizational component and aspect. Whether individuals are put in a position to identify and recognize their company culture in all of the aspects of their day-to-day activities, insofar as to establish a clear line of sight between the rhetoric and practice of their company culture, these are likely to genuinely embrace and support this.

The most important role of HR is therefore that to ensure and secure that the tenets and ideas underpinning organizational culture are properly and visibly reflected in the organization human capital practices. In many important respects, the development of HR policies underpinned by the values put at the basis of organizational culture will also enable organizations to foster consistency and integrity within the organizational settings and provide employees clear evidence that their employer actually talks the talk.

The set of behavioural norms stemming from corporate culture are typically unwritten; with the passing of time individuals might thus lose sight of the original tenets put at the basis of corporate culture, whether these are not identifiable and recognizable in all the aspects characterizing their daily working life. Human capital policies clearly inspired by corporate culture enable individuals to constantly identify the link existing between corporate culture and organizational success and in many respects help employers to translate into written norms this type of norms, which are by nature typically unwritten. Irrespective of their personal appreciation of these norms, individuals will be able to understand that the employer is expected them to behave in a given way in order for the organization to attain the desired level of performance and yield the desired results.

Appropriately and timely reflecting organizational culture and its changes on HR policies enables employers to attain two significant objectives at once: promote consistency and integrity, and favour visibility of corporate values and beliefs.

As discussed above, nonetheless, corporate culture can be hardly regarded as a stable organizational component; in contrast, it is highly likely that this evolves and changes over time. Some of the changes taking place in the exogenous environment, which may affect an organization culture, might sometimes gone unnoticed at board level, but this should never ever happen at HR level. HR needs to be extremely vigilant in this sense and immediately detect the extent of the impact that a change taking place in the external environment may potentially have on organizational culture and thus on human capital practices, and assess whether this change might in some ways affect organizational climate and performance.

Despite the role of HR is not that of developing corporate culture, this may play a role in shaping and moulding it by supporting the employer when some amendments or adjustments are required. According to its scale, a required change in corporate culture is clearly likely to make an impact on individuals; assessing and estimating the seriousness of this impact as early as possible is absolutely important to timely develop the appropriate plan of action enabling the employer to resist the restraining forces to its implementation eventually arising. Yet, some changes might also make a direct, remarkable impact on HR policies, which accounts for this assessment gaining further and considerable significance. The role of HR in corporate culture, under these circumstances, is hence sorely critical.

Whereas more often than not the advisory role of HR in corporate culture is limited to suggesting employers how to transform their vision into corporate culture, under some circumstances, to wit: when corporate culture needs to be amended and adjusted to suit the changed circumstances, the role of HR may become more important, insofar as this to propose employers which changes introduce to corporate culture. The role of HR will still clearly continue to be an exclusively advisory role, but would gain more significance in this case by reason of HR being in a position to propose employers likely effective options in that being able to immediately envisage the likely effects and consequences eventually produced by the anticipated change.

For more pervasive the role of HR in organizational culture might in these instances be the final responsibility and thus decision will invariably rest with the business founder. Under no circumstances an employer might convincingly and credibly embrace and foster a culture this does not totally approve and feel to be fully part of his/her frame of reference. For employers, it is not indeed just a matter of rhetoric, but rather of practically behaving so as to provide day after day employees an inspiring example.

Employers’ request for HR support clearly depends on the credibility, professionalism and strategic contribution HR has been capable to respectively gain, show and make over time. The more effectual and efficacious HR support has proved to be, the more willingly employer will accept HR contribution in this delicate subject. Corporate culture definitely represents a dramatically important organizational feature, which can make or break the effective execution of organizational strategy; it is unlikely that employers might hence accept to talk about this aspect with HR, whether this has not previously shown to fully have the standing, capability and expertise to effectively and properly support the employer in dealing with this subject. After all, it is also unlikely that any other organizational function within a company might have this capability and expertise so that HR should undoubtedly ensure employers to have an overarching knowledge of corporate culture and of all the effects and side effects its changes can potentially entail.

Longo, R., (2015), The role played by HR in corporate culture; Milan: HR Professionals.