Market Culture - Competing Values Framework

:D im good ^_^suppliers, customers, regulators, and the like. Profitability, financial results, ability to create market niches, and secure customer bases are primary objectives of these companies (Cameron & Quinn, 1999). The hope within these organizations is that the drive to beat competitors will improve employee morale, and direct, internal attempts to make employees happy are not as valuable.

Naturally, very few foundations will be comfortable existing within this model. The Market culture is above all competitive, and foundations are not well served by trying to outdo their colleagues. However, there are some aspects of this culture that might be beneficial for foundations. At times, competitive thinking will help a foundation to find a niche in grant making that will help the foundation focus its activities, and perhaps create a deeper impact. In addition, a market orientation will spur foundations to consider grantees as customers, and rely on customer feedback to improve operations. Attempting to incorporate some characteristics of the Market culture into a foundation’s existing culture will reduce arrogance on the part of the foundation, and reorient the its focus on the stakeholders who truly matter.

In summary, the Competing Values Framework is particularly useful for grant-making institutions, as a foundation must look both at how it is meeting external needs and how it is reaching the goals that it has set internally. At the same time, foundations struggle with the need to protect their corpus and be responsible stewards of their endowments. The Competing Values Framework will allow foundation leaders to better assess what type of culture currently exists in their organizations, and in what direction they want to move.

There are many other ways to diagnose an organization’s culture. In fact, Cameron and Quinn argue that culture “comprises a complex, interrelated, comprehensive, and ambiguous set of factors. Consequently, it is impossible to ever include every relevant factor in diagnosing and assessing organizational culture” (Cameron & Quinn, 1999, p. 29). There are many ways to define culture, but perhaps Barry Phegan said it most elegantly when he wrote that culture “is history expressed in the present” (Phegan, 1996, p.3).

The Importance of Culture within a Foundation

After addressing the question “what is culture?” the next logical question is: “why is it important to a foundation?” As stated in the introduction, many management theorists have paid attention to culture in an attempt to link strong organizational cultures to improved profits. However, foundations are not interested in profits; they have a different motivation altogether. The motivations of foundations are complex, and they will vary between different organizations. However, it can safely be argued that consistency in grant making will almost always be valued, as it prevents feelings of unfairness among grant-seekers. It also follows that in order to maintain consistent standards, one must have a stable work force.

Job Satisfaction and Reduced Turnover

A strong organizational culture has been shown to increase job satisfaction, especially in nonprofit organizations, and an increase in job satisfaction will often reduce turnover. A strong organizational culture within a nonprofit will remind all the employees what exactly they are working for, what they are committed to, and how they are effective. Reminding employees that they share the same values, and that their goals are important and necessary is extremely important in a nonprofit. A report on the need of capacity building in nonprofit organizations prepared by Venture Philanthropy Partners states: “For nonprofits, culture plays an even more vital role than it does for business. The culture holds the organization together, an important reason why nonprofit employees are willing to accept relatively low pay and work so hard” (McKinsey, 2001, p. 63). It thus stands to reason that a nonprofit, mission-driven organization’s ability to maintain a steady work force relies upon its ability to show its employees that what they do is more important than high salaries.

Nonprofits know that turnover is a problem and that organizational culture can improve job satisfaction. In a report prepared by Compasspoint Nonprofit Services, 64% of polled nonprofit organizations in Northern California stated that staff turnover and position vacancy had a high or very high impact on their organization’s ability to run effectively (Peters, Fernandopulle, Masaoka, Chan, and Wolfred, 2002, p. 9). Furthermore, 39% of the organizations that are experiencing issues with turnover attempt to recruit new employees and retain current employees by emphasizing their organization’s culture (Peters et al., 2002, p. 13). While the vast majority of organizations polled in this survey were public charities and not foundations, the outcomes can be applied to foundations, as foundations are basically similar to public charities in that they are both mission-driven entities with external stakeholders. While foundations do often pay higher salaries than nonprofits (Abbot, Langer & Associates, 1999), foundations are encouraged to use their cultures to better compete with other foundations and with the for-profit sector for qualified, committed employees.

Similarly, Mitchell and Yates (2002) argue that organizational culture should be central to recruiting efforts. They urge nonprofit leaders to “focus your recruiting efforts on volunteers and paid employees whose value systems are compatible with your organizational culture. Since you probably can’t compete with for-profit companies when it comes to monetary incentives…your culture is one of your best recruiting tools. Volunteers and paid employees are most likely to join your organization if doing so will further their own personal values” (Mitchell & Yates, 2002, p. 33). As stated above, within a strong organizational culture, employees will share the same basic assumptions and strong unconscious beliefs. As potential nonprofit employees will look for organizations that match their value system, it is important for the nonprofit to have a culture that clearly lays out what its values are, and invites a new employee to share in the struggle of furthering these values. A foundation with a strong culture will keep its employees because the employees feel that their work is important and that they are working alongside like-minded individuals toward a common goal. And within the foundation setting, this consistent, reliable work force will help to create consistent grant