Hierarchy and power are fundamental aspects of every organizational structure, but their perception and implementation vary significantly depending on the cultural context. Research in organizational culture indicates that the way organizations approach power, authority, and decision-making has a profound impact on their effectiveness, innovation, and employee well-being. This article analyzes how cultural differences shape approaches to hierarchy and power, and how these differences translate into organizational structures and management practices in the global business context. Studies published in leading management and organizational psychology journals provide fascinating insights into how cultural aspects of hierarchy determine the success of organizations in various regions of the world.
Models of Organizational Cultures and Approaches to Hierarchy
Organizational culture is a complex system of values, norms, and beliefs that shapes how an organization functions and how its members behave. One of the most recognized models of organizational cultures is the typology by Cameron and Quinn, which distinguishes four basic types of cultures: hierarchy, market, clan, and adhocracy. Each of these types has a different approach to power and organizational structure.
Hierarchical culture is characterized by a highly formalized structure, bureaucracy, and strict adherence to established procedures and rules, which are usually codified in official regulations. This type of culture is inward-focused and provides a sense of security and stability, associated with predictability, uniformity, high efficiency, and precise organizational processes. Research indicates that hierarchical culture is most commonly found in large public institutions and international corporations, where there is an emphasis on control, coordination, and operational efficiency.
In contrast to hierarchical culture, clan culture (also known as collaborative culture) features a flat organizational structure and resembles the functioning of a family. In this type of culture, there is a common focus on goals and values, a strong sense of community, and encouragement of active participation in the organization’s life. Organizations with a clan culture are more focused on engagement, teamwork, and employee well-being than on rigid procedures or hierarchical structures.
According to research conducted in a large service enterprise, presented by Chuda and Wyrwicka, employees often identify hierarchical culture as dominant in the current organizational profile, while preferring clan culture as the desired state. This discrepancy between the current and desired state may suggest that hierarchical structures, despite their prevalence, do not always meet the needs and expectations of modern employees.
Cultural Differences in Approaches to Hierarchy and Power
Cross-cultural research shows significant differences in approaches to hierarchy and power between Eastern and Western cultures. Far Eastern cultures traditionally value high power distance and hierarchical organizational structures. In countries such as China or Japan, a bureaucratic management model with strong authority of owners and top managers, and decisions made in a hierarchical (top-down) manner, is widely accepted and considered effective.
In contrast, in Western countries such as the United States or Australia, more value is placed on authority backed by performance and qualifications, and on decentralization of decision-making and control processes. In these cultures, employee empowerment is seen as a key factor in increasing engagement, productivity, and job satisfaction. Research by Cameron and Quinn indicates that organizations in Western cultures are more likely to adopt adhocracy or market culture models, which are characterized by greater flexibility and openness to innovation.
Interesting observations about cultural differences can also be found in leadership research. In cultures with a high power distance, an authoritarian management style is accepted, whereas in cultures with a low power distance, participatory and transformational leadership styles are preferred. These cultural differences have a direct impact on organizational structures – in cultures with a high power distance, structures are typically more hierarchical and centralized, while in cultures with a low power distance, flatter and decentralized structures dominate.
The Evolution of Thinking About Power in Organizations
Historically, the approach to power in organizations has evolved from traditional, hierarchical models to more contemporary, participatory forms of management. As early as the 1920s, Mary Parker Follett, one of the pioneers of management theory, introduced a distinction between “power over” and “power with”. According to Follett, the first type of power leads to dominance and subordination, while the second fosters collaboration in achieving common goals.
Follett also proposed the concept of the “law of the situation”, according to which individuals involved in decision-making in an organization should not treat each other as superiors and subordinates, but instead approach the issue from a situational perspective. This innovative perspective was an important step towards more egalitarian and adaptive organizational structures, which are gaining popularity in today’s dynamic business environment.
As research on organizational culture has evolved, traditional approaches to power based on formal hierarchical positions have given way to models based on competence, knowledge, and transformational leadership. Studies show that transformational leadership is associated with better mental and physical health for employees, suggesting that this management style can lead to healthier and more balanced organizational cultures.
The Impact of Hierarchy on Employee Well-being and Organizational Effectiveness
Scientific research indicates a complex relationship between hierarchical culture and employee well-being and organizational effectiveness. On the one hand, hierarchical culture can provide clarity of roles, stability, and predictability, which for some employees is a source of security. On the other hand, excessive bureaucracy and rigid hierarchical structures can negatively affect employee satisfaction and mental well-being.
Hierarchical culture is associated with limited employee autonomy, which can lead to decreased job satisfaction due to reduced opportunities for self-determination. Studies show that autonomy in the workplace is often seen as a key element affecting employee mental well-being. Furthermore, the transactional style associated with hierarchical organizational structure can increase feelings of alienation at work, and autocratic leadership correlates with lower vitality and higher burnout levels among employees.
Interesting conclusions also emerge from analyzing the correlation between types of organizational cultures and factors that reduce employee well-being. Studies show that market and hierarchical cultures are more often associated with higher levels of burnout than clan or adhocracy cultures. However, it is difficult to determine definitively which type of culture is best – each has its advantages and disadvantages, and their effectiveness depends on the cultural context, industry, and specific organizational characteristics.
Contemporary Trends in Shaping Organizational Cultures
Contemporary research highlights the growing need to adapt organizational structures to the changing expectations of employees and the dynamic business environment. Consulting firm Bain & Company, which ranked first among large employers in the USA on the prestigious Best Places to Work 2024 list, emphasizes the importance of building a cohesive organizational culture based on four key principles that contributed to its success.
One of the clear trends is the shift away from traditional, hierarchical structures towards more flexible and adaptive models. According to an article published in MIT Sloan Management Review, organizations seeking cultural transformation find that traditional actions are often ineffective because they do not significantly impact employees. An alternative is proposed in the form of a skills development approach, which allows skeptics of change to become its advocates, leading to lasting transformation of organizational culture.
An interesting example of a modern approach to organizational culture is the company Isolution, which has developed a motivational system that goes beyond the traditional reward and punishment model. The company focuses on unlocking employees’ internal motivation through tools such as “kudos”, “happiness index”, and “market initiatives”. Through consciously built organizational culture supported by proprietary technologies, the company has achieved spectacular results, including reducing turnover in the development department to just 2% and increasing employee referrals to 40%.
Practical Implications for Managing Organizations
Understanding cultural differences in approaches to hierarchy and power has significant practical implications for managing organizations, especially in an international context. Managers working in different cultural contexts must be aware that what is effective in one culture may be ineffective or even counterproductive in another.
Diagnosing organizational culture is an important first step in the process of managing culture. The OCAI (Organizational Culture Assessment Instrument) questionnaire, developed by Cameron and Quinn, is one of the tools that allows the assessment of the dominant culture type in an organization and the identification of discrepancies between the current culture and the preferred culture by employees. Such a diagnosis allows interpreting results from different perspectives and determining the dominant culture type in the company, discrepancies between the prevailing culture and the preferred culture by employees, the strength of the prevailing culture, and the alignment of culture profiles for different organizational traits.
Studies also show that organizations should strive for greater flexibility in shaping their structures, considering both the cultural context and the industry, as well as the needs and expectations of employees. In Western cultures, where autonomy and participation are increasingly valued, it is worth considering implementing elements of clan or adhocracy culture, which foster innovation and employee engagement. On the other hand, in cultural contexts where hierarchy is deeply rooted, sudden shifts to flat structures may cause confusion and resistance, so changes should be introduced gradually and with respect for local cultural values.
Conclusions and Future Perspectives
Cultural approaches to hierarchy and power have a profound impact on organizational structures and organizational effectiveness. Scientific research indicates that there is no one-size-fits-all model that would be optimal in all cultural and organizational contexts. Each type of organizational culture has its advantages and disadvantages, and their effectiveness depends on various factors, including cultural context, industry, organizational size, and strategic goals.
Contemporary trends point to the growing popularity of more flexible and adaptive organizational structures, which allow greater employee participation and faster responses to changes in the business environment. However, implementing such changes requires considering the cultural context and a gradual approach, especially in cultures with a high power distance.
Research on organizational culture and its impact on power structures will undoubtedly continue in the future, providing new insights and inspiration for management practitioners. A particularly interesting area of research may be the impact of digital transformation and remote work on organizational hierarchies and how different cultures adapt to these new challenges. Understanding the cultural aspects of hierarchy and power remains a key element of effective management in a global, culturally diverse business environment, where the ability to adjust organizational structures to local cultural contexts can provide a significant competitive advantage.
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