The Importance of Organizational Culture and Leadership Theories for Success

In this discussion we will discuss about globalization of world’s economy and below are the summaries point:- Culture has a direct correlation with the performance of an organization and refers to shared beliefs and values manifested by leaders. Leadership is crucial in shaping the culture of an organization and achieving its goals. The five leadership theories are trait, behavior, contingency, transactional, and transformational, and a leader needs to develop a new culture best suitable in each situation.

With the globalization of world’s economy, the culture has taken broader term and has a
direct corelation with the performance of an organization. According to Geert Hofstede
“Culture is the collective programming of the mind which distinguishes the members of one
category of people from another.” Likewise different experts have come with the lists of
definition of culture. In term of an organization, culture refers to the shared beliefs and
values manifested by leaders to shape employees’ perceptions, behaviours and
understanding that is communicated and reinforced through various methods. The work
culture highly determines the success or failure of an organization. To compete in the fast-
paced environment, an organisation must develop a safe culture for its employee.
Leadership is about inspiring, empowering, directing, and motivating people in the
organization and sometimes watching them succeed from behind. According to Alan Keith,
“Leadership is ultimately about creating a way for people to contribute to making something
extraordinary to happen.” There are several research conducted to determine the
relationship between organizational culture and leadership behaviours. Some argue that
leadership drive culture while others believe culture derive leadership in the organization.
To my understanding, Leadership is a crucial factor that shapes the culture of an
organization and guides towards achieving the ultimate goals. I will discuss different
leadership theories to analyse the situations.
Leadership theories are the methods and styles that a leader should incorporate in running a
successful business and achieving an overall growth of the organization. The role and
responsibilities of leader is defined by these theories. The five leadership theories are
beautifully presented by Radhika kapur in her research paper, Understanding Leadership
Theories (2020). As stated in her paper, the first theory is the trait theory, which explain
personality traits that the leaders need to have. The theory suggests certain people are born
with key personal characteristics to influence others and direct them to achieve
organizational goal. The second theory is the Behavior theory, which puts emphasis upon
the behaviour and conduct of the leaders and how they influence the Behavior of their
subordinates. The third theory is the contingency model. This theory suggests the most
suitable leadership style in each situation. The fourth theory is transaction theory of
leadership. In this theory, there is an exchange of ideas and perspectives between leader
and subordinates. Leader motivates and direct followers towards right direction. The fifth
theory is transformational theory which not only focus on implementation of advance
technology and innovation by leaders but also about transformation of individual attitude in
workplace. After a certain point, cultural beliefs, values, and norms no longer serve the
purpose of the company. A leader needs to develop new culture best suitable in each
situation.
Peoples are the most valuable assets of an organisation. With the emergence of
technologies and globalization of process, people from different cultures and backgrounds
work together as a team. A successful organization has leaders who have implemented good
organisational culture that meet the expectation of employees as well as their customers.
One of the great examples of leadership driven culture is Google (Tran, 2017). The tech hub
with a mission to empower the world with one click answers, is constantly working towards
building a better working environment for its employee. The top management has provided
facilities like free food, training centre, gaming zone, spa, free health care and transportation
accessible to all its employee. This motivates employees to work harder without worrying

about their physical and mental well-being. The work environment highly influences the
outcome of the employees. A good leader is one who can recognise the hidden talent of its
team and bring the best out of them. Leadership is a continuous learning process. It is
essential to have a goal-oriented leader to implement a good culture in any organisation, so
the objectives of an organisation are met.
In conclusion, “culture and leadership are two sides of the same coin and one cannot
understand one without the other”, (Schein 2009). The working atmosphere,
communication technique and problem-solving approach implemented in an organization
determine what type of culture is set in an organization. An unqualified leader may create an
environment which demotivate the morale of an employee. They may deviate from their
responsibility and create hindrances in achieve the organisational goal. Hence, leadership is
a key to derive culture.
References
1. Kapur, Radhika. (2020). Understanding Leadership Theories.
2. Sang Kim Tran, 2017. "GOOGLE: a reflection of culture, leader, and
management," International Journal of Corporate Social Responsibility, Springer, vol.
2(1), pages 1-14, December.
3. Schein E. H., 2009 The corporate culture survival guide vol. 158: John Wiley & Sons.