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Markkula Center for Applied Ethics

Defining Healthy Organizational Culture

Culture Self-Assessment Practice

Defining Healthy Organizational Culture

Ann Skeet

Ann Skeet is the senior director of Leadership Ethics at the Markkula Center for Applied Ethics.

Unhealthy culture is at the heart of scandal. Daily headlines, soundbites, and tweets surface decisions made in organizations rife with practices that prevent people from acting ethically and adversely affect corporate performance over time. Using findings that define mental health in human beings, we can develop a definition of healthy organizational culture, by using the corollary definition of mental health in human beings, providing people in workplaces a positive goal to work towards. The key is integration.

The good life involves many experiences doing things in groups—as children, in school and in activities like sports; and for adults at work, or in the community. When participating in with others, a group culture emerges. Anecdotally, there is more information about unhealthy, dysfunctional cultures than definitions of healthy ones. This essay explores an analogy to human well-being and defines healthy organizational culture.

Daniel J. Siegel, psychiatrist, author, and executive director of the Mindsight Institute, has identified the workings and connections between a healthy mind, healthy brain, and healthy relationships to capture the elements of human mental health. These elements can also be used to describe cultural attributes for organizations to emulate. Dr. Seigel explores how each piece of the triangle of human potential—the brain, the mind, and relationships—interacts to create well-being and health. The key, he posits, is integration—the linkage of differentiated parts. I believe we can use this same approach to identify health in organizations.

Siegel has explored integration within and between minds, brains, and relationships to understand how people achieve a sense of well-being.

    1. Healthy organizations foster empathic relationships, developing the capacity for interaction with others, both inside and outside of the organization. 
    2. Like a healthy mind, as described by Siegel, organizations should be flexible, adaptable, coherent, energized, and stable and develop an ability to reflect on themselves, gaining organizational mindsight
    3. Integrating different organizational systems makes it easier for organizations to function, as the brain does for the body. Integration refers to the cross-functional collaborative, linking functions that coordinate various processes within the mind, according to researchers defining health and well-being. 

Organizations with empathic relationships, organizational mindsight, and integrated functions are more likely to react ethically, almost without thinking about it, because they possess ethical organizational reflexivity.

In this way, organizations also draw on this triangle of potential—what the organization “thinks” or learns as it reflects on itself, how people within it interact, and how it functions. Healthy organizations are integrated.

Albert Einstein also recognized the power of integration, saying, “The widening of a circle of compassion is an optical delusion of our separateness beginning to dissolve in this integration, not just a vision, but a lived reality of how we are part of an interconnected whole, in ways we cannot see and in ways that go on long after we are gone. From this emerges a deep sense of being alive or awakening.”

Einstein embraces interconnectedness in this statement as a reality, not just an aspiration. In my opinion, executives who now ascribe to stakeholder capitalism, as the recently redefined statement of business purpose updated by the Business Roundtable suggests, are not turning away from their responsibilities to shareholders. Rather, they are acknowledging how connected business returns are to the outcomes experienced by other stakeholders, including employees, customers, and the environment.

Siegel connects the understanding of how the brain’s functioning works to that of other researchers to conclude that neural integration is fundamental to self-regulation and the brain’s ability to create a sense of self and to organize oneself in human beings. So, too, is the integration in corporations fundamental to their ability to self-regulate, create a sense of self, and organize.

Like human beings, organizations are complex systems. In complexity theory, systems move toward increasingly differentiated and integrated states. When systems are coupled together in larger systems, integration allows for maximum complexity, as exemplified by the human body. Systems attain balance between continuity and flexibility by having the ability to modify constraints. 

Organizations where leaders recognize a need to balance between continuity and flexibility are more likely to foster healthy cultures where people are respected for their differentiation—their unique skills and attributes and their rights and moral autonomy as individuals—and their connections to one another in empathic, well-supported relationships capable of collaboration.

Factors of Healthy Functioning for Organizations

Siegel’s work explores a healthy brain and focuses on the functionality we all get from our prefrontal cortex. For organizations to function effectively, they need capabilities similar to those provided by a healthy brain—the ability to regulate themselves, communicate, etc. for example, emotional balance is the brain’s ability to remain stimulated enough to be aware of and engaged in surroundings and relationships, but not so stimulated that a person is overwhelmed by his feelings to a point he can’t function. It is one thing for employees to feel excited and even nervous about their work, without having them become fearful.

The Healthy Mind of an Organization

Cultures have various elements: declarative, structural, symbolic, and normative (Gutierrez 1996). Separate research the Markkula Center for Applied Ethics at Santa Clara University has done with the ethics center at Deusto, the Jesuit university in Bilboa, Spain, indicates that companies who use a mix of these elements are more likely to value and use ethics.

Healthy systems are always moving toward complexity, where a balance between rigidity and chaos creates a state of harmony. Siegel uses an acronym, FACES, to describe the flow of moving towards integration in the mind. Healthy organizations, like healthy minds, are: Flexible, Adaptive, Coherent, Energized and Stable.

Flexible: able to be easily modified to respond to altered circumstances or conditions

Adaptable: able to adjust to new conditions

Coherent: united as or forming a whole; logical and consistent

Energized: motivated, stimulated, vital

Stable: not likely to change or fail; firmly established

Organizations with these capabilities organize themselves in ways promoting sustainability over time.

The Organization’s Relationships: How it Interacts

Siegel uses this statement to capture the perspective of a healthy person, describing the interactions of the mind, brain, and relationships:

“I accept your autonomy but I bring you into me and respond with some of me.”

We are separate, but connected, and we are shaped by our relationships with other people. Siegel hones in on the nature of connectedness by defining resonance, with emphasis on how systems interact. “Resonance is the property of interacting systems that defines the influence of each system’s activity on the other.”

Our research suggests companies able to identify and accept their role in broader society—that what they do influences society and vice versa—are more likely to use ethics. Additionally, companies that recognize the moral autonomy of individuals, both the ability and the desire of each of us to reason for ourselves what is good, and what actions are the right ones take, also promote ethics.

For the people who are in an organization, their “lived reality,” as Einstein referred to it, is that they are part of an interconnected whole that is the corporation. They influence and are influenced by their connection to that corporation and its connection to society. Relationships are an integral part of the human experience and of organizational culture.

The Organization’s Brain: Integrating Functions

Within the brain, differentiated components—systems in the body—become integrated or linked to improve the brain’s ability to function through regulation, attuned communications, emotional balance, response flexibility, insight, empathy, fear modulation, intuition, and morality. Healthy organizations function in analogous ways. Like the brain, they can be more heavily right-brain oriented—able to divine strategic opportunity by seeing the big picture—or more left-brain oriented—strong in execution of tasks. Organizations integrating both strategy and execution maximize their potential.

Realizing the Organization’s Full Potential Through Integration

Healthy organizations build all three capacities—the capacity for self-awareness and reflection, an understanding of their connections inside and outside of the corporation, and the capacity to integrate strategic and tactical functions. They have a well-defined, positive image of themselves; foster empathic, supportive relationships between people within the organization and beyond it; and integrate functions across the organization regularly and with ease.

These are concepts both ancient and fresh. From St. Ignatius of Loyola, living 500 years ago, “Work as if everything depended on you, pray as if everything depended on God,” to Eckhart Tolle, living today, “At the deepest level of Being, you are one with all that is,” grappling with how we think about ourselves as differentiated individuals, yet understanding and accepting our connection to others occupies our thoughts and our activities.

The human system’s senses are a useful organizing principle for corporate culture. In addition to the five senses that we learn the body possesses when we are in elementary school—taste, touch, sight, smell, hearing—Siegel identifies additional senses humans develop that are also found in healthy organizational cultures:

A 6th sense, or ability to perceive the internal state;

A 7th sense, the ability to perceive the mind and reflect on experiences; and

An 8th sense, the awareness of interconnectedness with other people.

Using what we have learned from Seigel, Einstein, St. Ignatius, to name a few, we can define a healthy culture for organizations. Such a definition provides us with a positive outcome to aim for when providing leadership in organizational settings. Rather than focusing on what is unhealthy or not working in an organization, we can aim for a positive, desired future state.

Healthy Culture Defined

A healthy culture is one that is integrated; in which individuals can thrive and participate in supported relationships, when they are part of groups, teams, or organizations. An integrated culture is flexible, adaptable, coherent, energized and stable. Organizations, like other healthy complex systems, have the ability to perceive their internal state, to reflect on experiences, and encourage interconnectedness between people. In other words, they have capacity for self-awareness, reflection, and connection. 

Ethical Organizational Reflexivity is the ability of organizations to act automatically using ethics. Corporations that possess it have honed their decision-making practices and responses to different stimuli so that participants know instinctively how to respond to them in an ethical way, a way that serves the mission and the values of the organization, and allows people to flourish. I define positive organizational reflexivity as the ability of organizations to act automatically using ethics and in support of human well-being. Organizations that have developed a practice of self-awareness, built in time and resources to allow for reflection, and reinforced connections to people both inside and outside of the organization create conditions favorable to the development of ethical reflexivity.

Siegal proposes domains of integration that humans can strive for to fully realize their potential. We can find reasonable corollaries in those domains of integration identified by Siegel, through the additional research we have done, to make the following set of recommendations for building healthy culture. 

9 Recommendations for Executives to Build Healthy Cultures

  1. Conduct regular organizational self-assessment: Expand the organization’s awareness of itself. Use a mix of tools—surveys, focus-group-based assessments, and other organizational sweeps to understand the current state of the company. Create opportunities for reflection. Together these will build the organization’s capacity for self-awareness and its ability to adapt based on what it has learned about itself.
  2. Create an organization-wide framework for ethical decision making: Focus on integration vertically within the company. How can the most senior executives and those in outward-facing or frontline roles be unified around a common set of practices and decision-making frameworks? The Markkula Center for Applied Ethics offers a tool for customizing our framework for ethical decision making to fit a specific organization. Using such tools develops an organization’s ethical organizational reflexivity, the ability of people in the organization to act automatically using ethics.
  3. Connect the silos: Design opportunities for intentional horizontal connectivity within the company, encouraging easy and frequent collaboration across workstreams. Create opportunities for people in different parts of the organization to work together in cross-divisional teams. Highlight integration by honoring strategic and executional divisions of the organization equally and frequently to highlight integration. Rotate people into roles in various divisions of the company. 
  4. Celebrate the organization’s history: Intentionally cultivate the organization’s memory of its shared history and desired legacy. Curate a set of examples that capture organizational potential realized. Capture learning in models that can be referred to in the future to reinforce positive outcomes. Such historical integration helps develop learning organizations.
  5. Tell stories: Encourage narrative integration through storytelling, inviting executives and managers throughout the organization to bring a sense of themselves into their leadership. Narrative integration enhances the ability of people to make connections with one another and identify desired behavior by relating personal and organizational stories.
  6. Nurture empathy: Cultivate awareness of the various “states of mind” possible in the organization at one time. For example, certain parts of a company may be well-established and in periods of relative stability and others may be newly created or emerging in their role in the organization. Acknowledge and communicate these differences to signal that they are normal and acceptable. Give high-potential employees who will serve in future leadership positions experiences in both realms—roles in traditional, well-established parts of the company and in the more innovative, emergent parts. And, give them opportunities to experience what the customers or clients of the organization experience. This empathic relationship development will increase the capacity of people to work internally and outside the organization in supported relationships.
  7. Create community consciously: Be intentional about creating a community where individuals have a sense of responsibility for having healthy relationships with other people in the organization. This conscious community-building reinforces the individual role each person has in connecting with others, both inside and outside of the organization, and modeling it. Employees are less likely to have good relationships with one another if the C suite does not. Students in schools where the teachers do not have a healthy community are less likely to experience one themselves.
  8. Acknowledge uncertainty and changeTemporal integration is the ability of humans, and organizations, to manage an uncertain future and function with acceptable levels of risk. We can plan for the future even though we aren’t certain what it will be. As humans, we struggle with living life fully present in the moment with the knowledge that we will die someday. Uncertainty about the time horizon of an organization, or a portion of the organization, is a realistic aspect of work life. Executives can acknowledge this tension as a way of helping those in the organization to manage change. 
  9. Always connect to the mission and vision: Dr. Siegel uses the term “transpiration” to describe the human final domain and as the “integration of integration itself”. The literal translation is to “breathe across” and in the human, it means we are aware that, though we are separate individuals, we derive meaning from our connectedness to entities greater than ourselves. Provide people in the organization with an understanding of its greater purpose and mission so they can experience their connection to it, thus creating organizational coherence.

(Revised July 29, 2020)

Oct 25, 2019

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Diez Gutierrez, Enrique Javier. Evaluation of culture in the organization of social education institutions. Unpublished doctoral dissertation. Complutense University of Madrid, 1996.

Siegel, Daniel J. The Developing Mind, Second Edition: How Relationships and the Brain Interact to Shape Who We Are. New York: Guilford Press, 2012.

Siegel, Daniel J. Mindsight: The New Science of Personal Transformation. New York: Bantam Books, 2012.

Siegel, Daniel J. The Mindful Therapist. New York: W.W. Norton, 2010.

Siegel, Daniel J. The Neurobiology of “We”: How Relationships, the Mind, and the Brain Interact to Shape Who We Are, 7 DVD set. Sounds True, 2011.

Tucker, D,M., Luu, P., Pribum, K.H. (1995) Social and emotional self-regulation. Annals of the New York Academy of Sciences. December 1995.

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