Key Idea: Every business has its own way of doing things that nobody writes down but everyone follows. This topic is the types of culture, why culture matters, and what happens when two cultures meet.
Handy's four types
- Power: one person at the centre decides, like Lena in her first shop.
- Role: rules, job descriptions and procedures, like Goldcrust.
- Task: teams formed for a project; person: experts who work for themselves.
Why culture matters
- A strong culture is shared by nearly everyone; a weak one is not.
- It shapes how fast decisions are made, who is recruited and whether staff stay.
- A strong culture can also resist change the business needs.
When cultures clash
- Growth: the small-firm way stops fitting a bigger business.
- Mergers and takeovers: two ways of working meet.
- A new leader or style: staff used to one way are asked for another.
The words to know
| Word | Means | Do not confuse with |
|---|---|---|
| Organizational culture | the shared values, beliefs and habits that shape how people in a business behave | the organization chart, which shows who reports to whom |
| Power culture | control sits with one person or a small group at the centre | autocratic leadership, which is a style, not a culture |
| Role culture | work is organized by rules, procedures and clear job roles | a tall structure on its own |
| Task culture | teams come together to complete a project, and expertise matters more than rank | a matrix structure, which is the chart, not the culture |
| Person culture | individuals are the focus and the business exists to serve their work | a caring culture: it is about independent experts |
| Strong culture | values that nearly everyone shares and acts on | a good culture: a strong culture can still be the wrong one |
| Cultural clash | conflict when two different cultures meet | a disagreement between two people |
Name the culture from what the case shows (who decides, how work is organized), then say what it means for this business: its speed, its staff, its ability to change. For a clash, name the two cultures, the point where they meet, and one way to reduce the clash.
Exam-style question
At Lena's Bakery Ltd, every decision, from a new loaf to a supplier, still goes through Lena. When she was ill for three weeks, a café contract went to Goldcrust because nobody else could agree the price. Explain one advantage and one disadvantage for Lena's Bakery Ltd of its power culture.
Model answer plan
See the mark-by-mark plan — for / against / judgement, with marking guidance — in study mode.
Important: A power culture is not the same as autocratic leadership, and a task culture is not the same as a matrix chart. Culture is how people behave; structure is the chart; style is how a leader leads. Name the culture from what people in the case actually do.
Tap each card to check yourself.
Goldcrust has a manual for every task and a job description for every post. Which culture? Role culture. Work is organized by rules and clear roles.
A team is formed for nine months to launch a gluten-free range. Which culture? Task culture. Expertise matters more than rank, and the team exists for the project.
State two benefits of a strong culture. Any two: staff know how to act without being told, loyalty and lower labour turnover, easier recruitment of people who fit, a clear identity for customers.
Why can a strong culture be a problem? It can resist change: staff hold on to the old way when the business needs a new one.
Name two situations that cause a cultural clash. Any two: rapid growth, a merger or takeover, a new leader or leadership style.
Name one way to reduce a clash after a takeover. Any one: explain the change early, involve both sides, keep the best of each culture, train staff together, keep the businesses separate at first.
Exam tips
- Name the culture from what people do in the case: who decides, how work is organized.
- Culture, structure and leadership style are three different things. Use the word the question asks for.
- A strong culture is not always a good one: say whether it helps or blocks what the business needs now.
- For a clash, name both cultures and where they meet.
- Every point about culture needs a detail from the case to earn its second mark.