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Does the Trickle-down Company Culture Work?

Communicating Organizational Values and Goals

From time to time, I read about a new theory that broadens the concept of company culture. The trickle- down culture is one such example.

What is Company Culture?

A company culture can be defined as a shared set of values, goals, attitudes and practices that make up an organization. It reflects both the written and unwritten rules that people in an organization follow. Organizational culture is the sum of views that top management and employees think, say, and do while working together to accomplish a mission. We could say that the company culture is the personality of the organization.

Company culture is the foundation of every business. When employees’ needs and goals align with their company culture, they’re more likely to enjoy their work. A strong culture indicates that the people are the priority in the company—not the output or revenue that it generates.

Culture expresses goals through values and beliefs and guides activity through shared assumptions and group norms. Often, corporate culture is implied, not expressly defined, and develops organically over time from the cumulative traits of the people that the company hires.

Trickle-down Company Culture

Most of us are familiar with “trickle-down economics,” or supply-side economics made popular during the presidency of Ronald Reagan. It describes “the theory that tax breaks and benefits for corporations and the wealthy will trickle down and eventually benefit everyone.”

“Trickle-down company culture” theory holds that there is an expectation that if culture exists at the top of the organization—with those in the C-suite and other leaders—then it should naturally trickle down to the rest of the company. In a trickle-down company culture, leaders believe that their idea and their own experiences of culture permeates throughout the organization and can be understood as the tone at the top set by those leaders.

The “tone at the top” is the message that leaders send to employees in an organization about the company’s values and beliefs. It has a distinct ethical tone that leaders should inculcate up and down the organization chart. Leaders should be aware that company culture does not just trickle-down but permeates throughout the organization. It needs to be fostered by leaders at every level in the organization.

Another way to look at trickle-down theory is to evaluate it in real time. In this sense, it is how supervisors who experience varying degrees of power subsequently treat their subordinates, especially as a function of any informational fairness they receive from their own managers. In a study by the Columbia Business School, trickle-down culture emerged from manager’s behavior towards their team. It was:

“Strongly influenced by both their sense of power and the information they received from their bosses.  This was especially so among lower-level managers who had relatively little power.  This lower sense of power meant that they were more likely to take cues as to their own behavior from those above them. Therefore, if managers don’t feel like they have much power, it’s especially important that they are themselves treated well by their own manager so that bad behavior doesn’t cascade down through the organization.”

Developing a Trickle-down Culture

According to Meagan Orr, writing for the online publication Rise People, the following are ways that a positive company culture can be developed and fostered at every level.

  • Give your managers and teams the tools they need to better support culture, as well as the agency to decide for themselves how company culture functions for them.
  • Create a very clear company vision and accompanying values that do trickle down into individual teams’ and employees’ understanding of what company culture looks like in your organization.
  • Allow your individual employees’ experiences and values to shape your company culture—think ‘flow upwards’ instead of trickle down—and don’t be too rigid about what culture looks like.

Orr asks the question: What if the board and senior management were acutely aware of exactly how the culture affected how employees fulfill their responsibilities to the organization. Would they be satisfied with its effect on decision-making and operations? Or might they be concerned that trickle-down culture does not permeate throughout the organization? Trickle down

Trickle-down Communication

Trickle-down communication is a form of organizational communication where the leader only distributes messages and information to those working directly under them. They, in turn, communicate with those working beneath them, until communication flows all the way down through the organization.

Poor communication can mean that lessons are not learned, and best practices are not shared. However, it can also mean that employees are not aware of what the organization is doing to improve decision making. Misunderstandings and informal channels of communication (grapevines) are likely to develop in the absence of good, formal channels of communication.

What Not to Do                                                                                               

Executives might demonstrate bad practices when using email to disseminate important information. Instead of communicating in a direct manner, they use a trickle-down approach that might lead to an unclear or confusing message, which then trickles down and infects all levels in the organization. Online messages can be misunderstood. It is akin to the old game of “telephone.” This is where a circle of people pass a message around by whispering it to each other, and the message is inevitably garbled by the time it gets back to the originator.

Here are some negative behaviors identified by Wendy Kneipp writing for the online publication, Q4intelligence, that could trickle-down throughout the organization with problematic results.

  • Not making decisions, avoiding commitments, not implementing scheduled changes.
  • Lack of responsiveness to communications.
  • Putting in minimum effort to achieve minimum expectations.
  • Not meeting deadlines and goals.
  • Not following through on commitments.
  • Canceling and not showing up for meetings or appointments.
  • Playing favorites based on relationships and not results.
  • Making excuses for these behaviors rather than owning up to the real Why.

Summing it Up

I agree with Wendy Kneipp that positive, focused, driven behaviors by leaders set an example for the those in the organization, that will: “Generally behave in the same way and have similar attitudes. It's contagious. And people tend to rise to the level of expectation or standard.”

However, the same is true for the negative behaviors displayed by leaders. When the team regularly sees poor behavior, they begin to see it as acceptable and respond accordingly. People also tend to lower their output to the level of expectation or standard.

Like most things in life and in organizations, the devil is in the details. To promote a trickle-down culture, leaders need to provide clear messages about how and why things are done the way they are in the organization and model such behavior.

Blog posted by Steven Mintz, PhD on May 11, 2023. Find out more about his professional activities on his website (https://www.stevenmintzethics.com/).  Follow him on Facebook at: https://www.facebook.com/StevenMintzEthics and on Twitter at: https://twitter.com/ethicssage. Check out professional recommendations on LinkedIn.