Nonprofit Organizational Assessment

According to Kotter and Heskett (1992), organizations with adaptive cultures perform
much better than organizations with unadaptive cultures. An adaptive culture translates
into organizational success; it is characterized by managers paying close attention to all
of their constituencies, especially customers, initiating change when needed, and taking
risks. An unadaptive culture can significantly reduce a firm's effectiveness, disabling the
firm from pursuing all its competitive/operational options.
Healthy companies are able to deal with employees' concerns about the well-being of
the organization internally, before the employees would even feel they needed to raise
the issues externally. It is for this reason that whistleblowing, particularly when it results
in serious damage to a company's reputation, is considered to be often a sign of a
chronically dysfunctional corporate culture. Another relevant concept is the notion of
"cultural functionality".
Specifically, some organizations have "functional" cultures while others have
"dysfunctional" cultures. A "functional" culture is a positive culture that contributes to an
organization's performance and success. A "dysfunctional" culture is one that hampers
or negatively affects an organization's performance and success.
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