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  • Georgia Henry

Is organisation culture intangible and unmeasurable?

Updated: Mar 20, 2019

Henry Reed, Organisation culture

Why is it that more than 90% of Company Directors have indicated that they need to improve their organisation's culture? (as reported in the 2017 AICD Director's Sentiment Index).

Organisation culture is often touted as the intangible element that will drive an organisation's success. It is focused on during times of significant change such as: mergers and acquisitions; change in leadership; technological disruption; the need for increased innovation; or driven by external changes requiring increased agility and responsiveness to achieve financial results. An organisation's culture is also questioned as a reaction to a significant event or exposure to a compliance breach (think Harvey Weinstein and Uber and so many other examples!)

As it was shown in the AICD Director's Sentiment Index, culture is an issue that many directors have identified needs attention, and rightly so. Culture is an essential element in ensuring an organisation's sustainability and performance.

It's my belief that an organisation's people provide their greatest competitive advantage. Let's face it, it is only through your people that you will: innovate; deliver customer experience; act ethically, ensure compliance; manage risks; deliver financial results and achieve your growth objectives. Your organisation culture is an essential element for attracting and retaining the best talent and ensuring that desired results are delivered.

What has surprised me during the discussions I have had with Directors about organisation culture over the last few months is that there exists a belief that because culture is intangible it can't be measured.

I believe that an organisation's culture is defined by some very tangible elements that can be measured, improved and changed to impact performance and results.

I see the essential elements of culture being: purpose; vision; values; risk appetite and governance. These elements of culture must be defined and clearly communicated to all stakeholders as they create the environment for all operations, decisions and actions which becomes your organisation's culture.

The level of understanding and application of these elements within the business is measurable; the demonstration of these behaviours by leaders and employees is measurable; and, of course, compliance and risk management is measurable.

Your culture is not only an internal environment but it impacts on your full scope of operations and interactions. It is essential that, for organisations to thrive, their culture is developed to maximise the potential of all employees, customers, business partners, the economic environment and market conditions in which the organisation operates.

Is your organisation's culture enabling the best results for your business?

Statistically, given the 2017 AICD Director's Sentiment Index, it's likely to need improving!

Knowing what your organisation culture should be and what it is in reality can highlight key areas for improvement and significant return on investment.

A great place to start is with a Henry Reed Culture Assessment and recommendations on ways to improve associated strategies and performance.

Georgia Henry

Director, Henry Reed

1300 266 995


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