The competing values framework was created by Robert Quinn and John Rohrbaugh, emerging from research into the major characteristics of effective organizations. The competing values framework is a tool used to understand and characterize organizational behaviors and beliefs and how they contribute to success.
| Competing Values Framework (CVF) | Description | Analysis | Implications | Applications | Examples |
|---|---|---|---|---|---|
| 1. Key Elements (KE) | The Competing Values Framework (CVF) is a model used to assess and understand organizational culture. It categorizes organizational cultures into four major types: Clan, Adhocracy, Hierarchy, and Market, each characterized by unique values, beliefs, and behaviors. | – Identify and categorize organizational cultures into one of the four CVF types. – Assess the dominant cultural traits within an organization. – Consider the interplay of multiple cultures within complex organizations. | – Provides a framework for analyzing and categorizing organizational culture. – Highlights the strengths and weaknesses associated with different cultural types. – Recognizes that organizations may exhibit a blend of cultural characteristics. | – Organizational culture assessment and transformation. – Leadership development and training. – Change management and alignment with strategic goals. | Key Elements Example: Identifying that an organization’s culture is primarily Clan-based, emphasizing collaboration, teamwork, and employee development. |
| 2. Clan Culture (CC) | Clan Culture is characterized by a family-like environment where members have a strong sense of belonging and collaboration. It values teamwork, mentorship, and employee development. | – Assess the presence of Clan Culture elements, such as strong relationships, mentorship programs, and a focus on employee well-being. – Evaluate how Clan Culture impacts decision-making and communication within the organization. – Consider the advantages and disadvantages of Clan Culture in achieving organizational goals. | – Fosters a supportive and cohesive work environment. – Encourages employee engagement, satisfaction, and retention. – May face challenges related to adaptability and competitiveness in fast-paced environments. | – Employee engagement and retention strategies. – Team building and leadership development programs. – Enhancing collaboration and communication within teams. | Clan Culture Example: A family-owned business that prioritizes close-knit relationships among employees and emphasizes mentorship and personal growth. |
| 3. Adhocracy Culture (AC) | Adhocracy Culture is characterized by a dynamic and entrepreneurial spirit that values innovation, experimentation, and risk-taking. It encourages employees to be creative and explore new ideas. | – Assess the presence of Adhocracy Culture elements, such as a focus on innovation, experimentation, and flexible work structures. – Evaluate how Adhocracy Culture influences decision-making and adaptability. – Consider the advantages and challenges of Adhocracy Culture in driving innovation and growth. | – Promotes innovation, adaptability, and rapid response to change. – Encourages creativity and a willingness to take calculated risks. – May face challenges related to stability and maintaining established processes. | – Innovation and product development initiatives. – Encouraging a culture of continuous learning and experimentation. – Nurturing creative problem-solving and idea generation. | Adhocracy Culture Example: A technology startup that values experimentation, encourages employees to pursue innovative projects, and promotes a culture of “out-of-the-box” thinking. |
| 4. Hierarchy Culture (HC) | Hierarchy Culture is characterized by a structured and controlled environment with clear roles, processes, and a focus on efficiency and stability. It values consistency, rules, and formalized procedures. | – Assess the presence of Hierarchy Culture elements, such as clearly defined roles, strict processes, and a focus on efficiency. – Evaluate how Hierarchy Culture affects decision-making and organizational stability. – Consider the strengths and limitations of Hierarchy Culture in achieving operational efficiency and compliance. | – Ensures clear roles, accountability, and adherence to established procedures. – Supports stability, predictability, and consistency in operations. – May encounter challenges related to adaptability and innovation in rapidly changing markets. | – Process optimization and efficiency improvement initiatives. – Compliance and risk management efforts. – Clarifying roles and responsibilities within organizations. | Hierarchy Culture Example: A government agency with strict protocols, clear hierarchy, and a focus on procedural compliance to maintain consistency and stability. |
| 5. Market Culture (MC) | Market Culture is characterized by a competitive and results-oriented environment that values achievement, customer focus, and profitability. It encourages employees to set and meet ambitious goals. | – Assess the presence of Market Culture elements, such as a strong focus on competition, results-driven behavior, and customer-centricity. – Evaluate how Market Culture influences decision-making and goal attainment. – Consider the advantages and challenges of Market Culture in achieving competitiveness and profitability. | – Drives a strong focus on achieving market success and profitability. – Encourages a competitive spirit and customer-centric mindset. – May face challenges related to work-life balance and employee well-being in highly competitive environments. | – Sales and revenue growth strategies. – Setting and aligning ambitious performance targets. – Cultivating a customer-focused mindset among employees. | Market Culture Example: A financial institution where employees are incentivized based on achieving sales targets and profitability, with a strong emphasis on competition and customer service. |
Table of Contents
Based on the study of culture, leadership, structure, and information processing, Quinn and Rohrbaugh discovered 39 different indicators of effectiveness. These were then analyzed for patterns and distilled into two major dimensions of organizational success:
The competing values framework has been recognized as one of the 40 most important frameworks in the history of business. It has wide-ranging applications in leadership competency, organizational culture, financial strategy, information processing, and life cycle stage development.
Four major models, or cultural archetypes, are derived from the degree to which a company is internally or externally focused and flexible or stable.
The interaction between each archetype appears to send conflicting messages, which gives the competing values framework its name. For instance, an organization may need to be flexible while also displaying control and stability at the same time.
With that said, let’s take a look at each archetype below:
The organizational values of the framework can also be used to model leadership styles.
Below is a brief look at some leadership types based on the hierarchies listed in the previous section:
To conclude, we’ll discuss some examples from each of the four main archetypes of the competing values framework.
The clan culture is often found in start-ups and smaller companies, but it can also be found in companies that employ the franchise model.
One particular example is Tom’s of Maine, an American business and Certified B Corporation that manufactures natural health products such as toothpaste, soap, and deodorant.
Founder Tom Chappell stressed the importance of respectful relationships between co-workers, customers, owners, suppliers, the community, and the environment.
Employees are provided with a safe environment to grow and learn and the culture is more reminiscent of an extended family, with Chappell serving as a mentor and parental figure to subordinates.
Pixar has a flat organizational structure which creates the ideal conditions for adhocracy to thrive.
The company has a proven track record of both artistic and technological innovations and is known as a leading pioneer in computer animation.
Pixar is proud to proclaim that, unlike its competitors, it has never purchased scripts or ideas from external parties.
All of the company’s worlds and stories from movies such as Toy Story, Finding Nemo, and Cars came from a creative team who were encouraged to take risks and push the metaphorical envelope.
Indeed, Pixar understands that true creative talent is rare and that management’s role is to not avoid risk entirely but ensure the company can recover easily when inevitable failures occur.
Most investment banks such as Goldman Sachs operate under the hierarchical model with a strict and inflexible structure.
Each is characterized by the following levels with only minor derivations between companies:
Each level is associated with certain rituals, benefits, and responsibilities, and employees need to be competitive and possess extreme levels of attention to detail.
Progression through these levels is well defined and has not changed considerably over time.
To encourage employees to work under the intense pressure of a hierarchical structure, promotions are frequent and there is little exclusivity to the titles in most investment banks.
Goldman Sachs, for example, has over 10,000 vice presidents and many firms also have thousands of managing directors.
Amazon is an oft-cited example of the market culture. Numerous former employees have spoken about a culture that expected the very best they could deliver and to be constantly climbing the ladder.
There were also claims in a 2015 New York Times article that if employees hit the wall – a phrase used to describe one reaching their emotional or physical limits – they were told the only solution was to “climb the wall”.
While the company has made efforts to address its controversial culture in recent years, Amazon’s obvious focus to be the best means it embodies the best (and worst) aspects of the market model for now.
One look at the company’s leadership principles confirms this, with the blurb under the “Deliver results” principle reading as follows: “Leaders focus on the key inputs for their business and deliver them with the right quality and in a timely fashion. Despite setbacks, they rise to the occasion and never settle.”
One of the primary drawbacks is the potential oversimplification of complex organizational cultures. Reducing an organization’s culture to one of four categories may not capture the nuanced and multifaceted nature of actual working environments.
There’s a risk that using the CVF could lead to stereotyping or mislabeling of organizations. This might result in misguided strategies or change initiatives that don’t align with the true nature of the organization.
Organizations identified with one particular culture type might resist moving towards another, even when necessary, due to a deep-rooted identification with their current cultural type.
The framework’s focus on competing values can make it challenging for leaders to effectively balance these values, especially in dynamic and complex environments.
Assessing and measuring organizational culture based on the CVF can be challenging and subjective, often requiring in-depth analysis and interpretation.
CVF is particularly useful for assessing and understanding an organization’s prevailing culture, providing a structured approach to analyze and categorize cultural traits.
The framework can be used in strategic planning to align organizational strategies with the underlying cultural values.
Leaders can use the CVF to develop skills and approaches that are congruent with their organization’s cultural type or to adapt their style to drive cultural change.
The CVF can guide change management processes by identifying cultural shifts that are necessary and feasible within the context of the existing cultural values.
Begin by identifying the dominant cultural characteristics of the organization using the four types of cultures defined in the CVF.
Analyze the current and future needs of the organization to determine which cultural characteristics are most beneficial and aligned with organizational goals.
Develop strategies and initiatives that reinforce the desired cultural characteristics. This might involve changes in leadership style, communication, decision-making processes, and human resource practices.
Implement programs and initiatives that facilitate the desired cultural change, ensuring involvement and buy-in from all levels of the organization.
Regularly monitor the cultural shifts and adapt strategies as necessary. This includes ongoing assessment of the organization’s cultural alignment with its strategic goals.
The CVF provides a comprehensive understanding of the organization’s culture, aiding in identifying strengths and areas for development.
By aligning cultural values with organizational strategies, the CVF can lead to more effective and coherent strategic implementation.
Understanding the dominant cultural type can guide leaders and managers in adopting practices and behaviors that are more effective within their specific cultural context.
When cultural traits are effectively aligned with organizational goals and strategies, it can lead to increased overall effectiveness and success.
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