Professor Emeritus, James L. Heskett, Harvard Business School argued that organisational culture can contribute 20-30% of the operational efficiency of the organisation. In 2017,  PricewaterhouseCoopers forecasted that Vietnam potentially become the 10th largest economy and fastest-growing economy in the world by 2050 when the annual GDP growth remains at 5.1%. Joining the global economy with many foreign investments and international organisation integration, businesses in Vietnam have adapted and built their own organisational culture to fit with the economy’s rapid growth.

Type of organisational culture

According to Hofstede (2001), national culture included 6 types: power distance, collectivism/individualism, and uncertainty avoidance, Masculinity/Femininity, Long Term/Short Term Orientation. Cameron and Quinn (2011) also believe that corporate culture could be classified based on each organizational structure; there are 4 types of organization culture: clan culture, hierarchical culture, market culture, adhocracy culture.

Flexibility and internal mechanisms of change management are the central focus of clan culture. Clan culture organizations are perceived as caring and empathetic entities that treating employees as part of their family. Teamwork, commiment and consensus are encouraged in these organizations. Adhocracy culture embraces the forward thinking and future-orientated approach. Contradict to bureaucratic organizational structure, adhocracy culture encourages innovation, willingness to take risk, individuality and innitiative through its creative and dynamic working environment (Cameron and Quinn, 2011). With the emphaisis on competitiveness, productivity and results, market culture’s differentiator from its competitors lies in its “witty” attitude. This attitude is characterized by the act of actively achieving the goals and business objectives and the strive to stay ahead of the competition. Lastly, hierachical corporate culture is a process-orientated structure that based their principles on stability of organizational rules and internal harmony. Hierarchy culture main characteristics involves sets of formal rules, procedures and a defined organizational structure (Cameron and Quinn, 2011).

Corporate culture is the factor that administers almost all business results.

Characteristics of Vietnamese organisational culture

Hofstede national culture indicates that Vietnam score 70 for power distance (reflect it is high power hierarchy country), 20 for individualism (implied Vietnam is highly collectivism), 40 for masculinity (implied Vietnam has moderate level of masculinity/femininity), 30 for uncertainty avoidance (implied Vietnam prefer to work based on the set of rules and regulation), 57 for long term orientation (reflect Vietnam has moderate level between long and short-term view).

Dr Lan Anh Nguyen, RMIT University, Australia found in her study that among Vietnam organisations the most popular culture is clan culture, then hierarchical culture, market culture and the least popular is adhocracy culture. Vietnamese accountants express their clear preference over clan culture. The dominant of clan culture suggests a contradiction to the expectations that in Vietnam – a country is currently experiencing a strong development phase, employees would shift their favourable towards a more flexible or "witty” culture such as market or adhocracy culture. Thus, their preference over clan culture implies that Vietnamese accountants enjoy working in a family-like environment that provide them with opportunities to demonstrate commitment and involvement. This lesson learnt has good impact to managers so that they can continue building their organisation into the direction of clan culture where everybody in the organisation is caring and looking after each other as a family. By implementing this, it would support the employee development, and could lead to a better co-operation and effective working environment for employees. Leading to the construction of a stronger organisation.

It is worth to note that high and clear power hierarchy culture is the second popular in Vietnamese organisation and followed by market culture and lastly is adhocracy culture (Dr. Thuy Pham, RMIT University, Vietnam). This view is somewhat consistent with Hofstede study where he found that Vietnam national culture scored highest for collectivism and second highest for power distance.

Corporate culture affects the employees’ motivation and working ethics

Employees often enjoy their work when their belief and working ethics are consistent with the organisation value, culture and code of ethics. The organisational culture is vital as employees feel more satisfied with their work and contribute further to their organisation if they feel they are valued. On the other hand, if employees do not feel they belong to the organisation and unable to integrate themselves into the organisational culture, they will not enjoy the work as much. Hence, developing organisational culture where it engages staff in the organisation together or building a culture where employees have the same believe is important and it can enhance their work ethics and quality of work.

Corporate culture enhances employee satisfaction and fosters greater contributions to the organization

There were examples for this. Firstly, if employee prefers to work in a dynamic environment such as adhocracy culture but in reality, they work for the organization that focus on power such as hierarchical culture. They will soon leave the organization. Secondly, the organizational culture also impacts on how employees behave. Per Dr. Nguyen, RMIT University Australia, accountants work in clan organizational culture are more likely to assess questionable behaviour as ethical compared with accountants in the hierarchy organisational culture.

Corporate culture is the “spiritual pillar” that construct the cornerstone of an enterprise and unites their members towards shared values and actions. For a long-term development, the diversified and complex working environment required corporates to be a gathering place that promote all human resources, build, and maintain a homogenous cultural environment where members share the same common values and orientate towards the same goals.

Dang Thi Mai Trang, Chief Representative of ICAEW Vietnam