The Influence of Leadership on Organizational Culture

A person is an integrative part of the society. Since the beginning of time, people always gather in groups whether it is a family, a company of friends or a multinational corporation. No matter of its form, specificity and aim a group always has a leader, the one who guides, takes decisions or leads through the difficult times. However, not in all cases the leadership as effective as it should be, and there are a lot of examples when ineffective leadership causes fatal mistakes. At the same time it is crucial to discover whether a group shapes its leader or vice versa. How does leadership have impact on a group, its organisational culture? Does leadership has the ability to transform the environment around and influence people? In the terms of globalisation and cultural diversity so people as big organizations are required to be flexible, innovative and competitive. To reach the goals and gain success it is crucial to organize the activities effectively by targeting necessary aims, choosing right path and be guided by effective leaders.

To meet all the requirements and answer the questions properly, it is important to find out the core purpose of leadership. Examination of any kind of a group results into similar conclusions. There are a group of internally motivated people who are driven by an active, inspirational and initiative person. The main purpose of a leader is to structure the space around the group, motivate people, and elevate their interest and to guide the energy of the group in the specified direction. However, one can define several types of leadership that can influence the environment and organizational culture in different way. Dictatorial type of leadership will never be interested in the opinion of a group and will have very narrow aspects of the organizational structure, its culture and ways of conduct. A leader in a dictator position will keep a group at bay; the organizational style will be aggressive and harsh. As there is the excess of power it can be the lack of one. There are also leaders who shift their duties on their deputies or even to the other members of the group. This kind of leadership frequently leads to the replacement of a leader. The quality of organizational culture in this case is very low or even absent as the duties are shifted. A leader who has the ability to see a group as the organization of separate individuals with special amount of talents, desires and potential will have the biggest possibility to find application to every member of a group and guide it in the right direction. The democratic leadership is the most ideal alternative among its other types as it can both inspire and guide a group into the right goal.

“Organizations that support and implement continuous and transformational change remain competitive.” (Gilley & McMillan, 2009) As life and every process within it tend to change and transform people have to embrace the changes as well. The changes in organizational structure and its culture have always being a stumbling-stone within the frames of a group. In most of the cases the main person confronting the changes is the leader and he/she is at the same time the only people who can implement the changes into the process of organization. This is the example of negative effect on the organizational culture of a group. Recently the flexibility and creativity of a leader is valued more than the other abilities. In the frames of technological revolution and the development of global business and structures the leadership has to find new ways of guidance to embrace the competitive nature of today’s state of affairs.

When one say about the organizational culture it is important to recall the notion of the subject. The first reference and the first emergence of the term appeared in 1980. The idea was presented by Schein. “Organizational culture is defined as a pattern of basic assumption - invented, discovered, or developed by a given group as it learns to cope with its problems of external adaptation and internal integration that has worked well enough to be considered valid and, therefore, to be taught to new members as the correct way to perceive, think and feel in relation to those problems.”(Cheung & Wong, 2012) The definition of the notion brings to the conclusion that organizational culture is the complex of apparent and covert admissions. The closer these suppositions are related to each other, the stronger the organizational culture. Every group or organization has its own external or corporative politics and agendas, at the same time, every member of a group has his/her own view of the way the things should be managed within an organization. If the external and internal perspectives resonate with each other the better organizational culture will exist. Organizational culture has several purposes and functions. It transfers to a group a sense of implication and involvement. Organizational culture also provides a group with the sense of commitment to the things beyond their own individuals. A strong organizational culture can be a guarantee of success.

Organizational culture is also divided into several types. McLaurin divided it to four types. Bureaucratic culture is based on the straight rules and has very strict hierarchy where leaders and subordinates are rigorously determined. The opposite to this type of culture there is a Clan culture where the decision making process are divided among the group equally, the discipline is not an issue. This type of organizational culture has its own customs and traditions and tight personal connections. Entrepreneurial culture is a compromise between the previous two. The main features of this culture are innovations, creativity, flexibility, autonomy. The fourth kind of culture is Market culture that bears several similar features of Entrepreneurial culture, though the relationship within a group is rather formal.

Due to the specific nature of organizational culture leaders can create it only in very rare cases. In most of the companies leaders come to already formed structure and organizational culture. “Whereas creating culture is generally viewed as a complex task, influencing or changing it is even harder.” (McLaurin, 2008) As the process of formatting of a company or a group has already formed, its organizational structure had already developed and has its own specific features. Scholars argue the fact that a leader as a new comer can influence the system of organizational culture, moreover, it is stated that it can damage the present harmony and personal relationship between the members of the group. Nevertheless, several researchers point out that organizational structure can be changed by the courageous leadership. Organizational culture can be affected by the leadership by the strict way as deleting the members of a group who are opposed to changes or hinder the working process. Leader can go in the opposite way and hire people who can benefit the changes in the organizational structure or help to improve the existing system. When using this particular approach, it is important to socialize new members of the group to the existing organization. A leader can try to alter the behaviour of members of a group. At this point, a leader has to find the approach to every member of a group and what is more important, to substantiate the reasons of changing organizational culture, to show all pros and cons of the transformations the process has to run for gaining new achievements. In some cases existing organizational culture can be totally destroyed by the leadership. Such transformations happen only in cases of a merger or transformation. In this situation, it is a necessary move as a lot of people are dismissed and new ones are hired. Due to drastic changes the existing cultural organization cannot exist and has to be replaced partially or totally by a new one.

Speaking about an impact that leadership can have on the organisational culture, it is crucial to mention two opposite groups of scholars that have diametrically opposite points of view to this issue. The functionalists argue that leaders are the ones who create and change organizational culture, on the opposite side there is anthropological view that sees leaders as the integral part of organizational culture, and states that leaders cannot influence it. When examining these two approaches it s hard to stick to one particular theory. There are circumstances that leadership cannot seriously influence organizational culture, and there are opposite cases when a leader can not only change, but also create a new organizational culture.

The changes in organizational culture depend on the type of leadership. “For an organizational culture to become more transformational, top management must articulate the changes that are required.... The behaviours of top-level leaders become symbols of the organization's new culture.”(Sarros & Cooper, 2008) It is crucial for leadership being transformational to execute any changes in the organizational culture. Transformational changes in organizational culture can cause some psychological changes within members of a group, like changing the behaviour, reactions, the way of conducting business and interconnection between each other. Good leaders have to point out that changing organizational culture they change people within the structure of a group.

To make a proper conclusion it is important to recall the definition of organizational structure. As it was mentioned before, it is a compound of internal and external assumptions that lies within a group. There are several points of views whether leadership influences the organizational structure or not. All the ideas have their own factual basis and assumptions in favour of their ideas. Concluding all the arguments the evidence of influential potential of leadership are stronger. Every leader either it is a new comer or a member of a group creates, shapes and changes the environment around him/her, so as the organizational culture. Transformational leadership has the ability to develop new lines and ways of organizational culture that is required recently in the days of globalization and technological revolution.

References

Cheung, S. O. & Wong, P. S. (2012). An Investigation of the Relationship between Organizational Culture and the Performance of Construction. Journal of Business Economics and Management, 13(4), 67-89.

Gilley, A. & McMillan, H. S. (2009). Organizational Change and Characteristics of Leadership Effectiveness. Journal of Leadership & Organizational Studies, 16(1), 17-29.

Latta, G. F. (2009). A Process Model of Organizational Change in Cultural Context: The Impact of Organizational Culture on Leading Change. Journal of Leadership & Organizational Studies, 16(1), 3-9.

McLaurin, J. R. (2008). Leader-Effectiveness across Cultural Boundaries: An Organizational Culture Perspective. Journal of Organizational Culture, Communication and Conflict, 12(1), 36-47. 

Sarros, J. C. & Cooper, B K. (2008). Building a Climate for Innovation through Transformational Leadership and Organizational Culture. Journal of Leadership & Organizational Studies, 15(2), 56-68.