Culturicity | Insights

How Team Culture Impacts Organisational Culture

Written by Matt Ellerton | Aug 27, 2024 4:09:39 PM
How do the distinct cultures of individual teams shape the broader organisational culture, influencing both challenges and successes?

What Makes up a Team Culture?

Team culture refers to the collective behaviours, values and beliefs that characterise how a team operates. Elements of team culture include how team members communicate, how they make decisions, and how they resolve conflicts. Also at the heart of team culture is how the team perceives and understands the shared mission or purpose of the team.

Understanding these elements is crucial because they directly influence how team members interact with each other and perform their tasks, both as individuals and collectively. A healthy team culture promotes collaboration, innovation and productivity, whereas a toxic culture can lead to conflict, inefficiency and high turnover rates.

The Ripple Effect of Team Culture on Organisational Health

The culture of individual teams can significantly impact the overall health of an organisation. When teams operate with a positive culture, they contribute to a more cohesive and supportive organisational environment. This can lead to enhanced employee satisfaction, better customer service, and increased overall performance. In other words, all the good stuff.

Conversely, if several teams within an organisation have negative or dysfunctional cultures, this can create siloes, reduce morale, and hinder organisational growth. The cumulative effect of these team cultures shapes the broader organisational culture, making it essential for leadership to monitor and address team dynamics proactively — not just once, but repeatedly and regularly.

Case Studies: Successful Team Cultures and Their Impact on Larger Organisations

Consider the case of Google, where the culture of innovation and psychological safety within teams has been a cornerstone of its success. Teams are encouraged to experiment, take risks, and learn from failures without fear of retribution. This team culture has been instrumental in driving continuous innovation and maintaining Google's competitive edge.

Similarly, Zappos is known for its unique team culture focused on delivering 'wow!' customer service. Teams at Zappos are empowered to go above and beyond for customers, a practice that has significantly contributed to the company’s strong brand loyalty and customer satisfaction.

Challenges Posed by Diverse Team Cultures

One of the primary challenges posed by diverse team cultures is the potential for misalignment and conflict. Different teams invariably have varying approaches to work, communication, and problem-solving, which can lead to misunderstandings and inefficiencies. How many times have I assessed a team's culture, only to see that team place all responsibility for poor interaction with other parts of the organisation onto the other teams? (hint: pretty much every time!)

Additionally, when teams have very different cultures from one another, it can be difficult to create a unified organisational culture. This fragmentation can hinder collaboration across departments and teams, and negatively impact the overall effectiveness of the organisation.

Strategies for Harmonising Different Team Cultures

Organisations can implement several strategies to harmonise different team cultures. Firstly, establishing clear, organisation-wide values and goals can provide a common framework within which all teams can operate — the key here is that values can't just be imposed top-down, they have to resonate throughout the whole organisation for them to work as a guiding light; a much better approach is to involve the organisation in co-creating what the values should be.

Regular cross-team interactions and collaborative projects can also help bridge cultural gaps and foster mutual understanding. Similarly, having a clear and shared understanding of the organisation's goals and where it wants to go helps teams align around a shared sense of purpose and direction more effectively than imposing arbitrary targets.     

Leadership plays a crucial role in this process. Gone are the days when information was to be treated as a weapon, to be shared only on a need-to-know basis. Leaders today need to be transparent, sharing information widely and acting as conduits for the culture by role modelling the behaviours they want their teams to display. 

Leaders should actively promote a culture of inclusivity, safety and respect, ensuring that team differences are seen as strengths rather than obstacles. Providing training and development opportunities focused on cultural competency can further support this harmonisation effort.

Sounds complicated? It doesn't have to be, so if you'd like help assessing or shifting the culture in your team or your organisation, get in touch — I'd love to help.