THE COMPETING VALUES FRAMEWORK
Kim Cameron, PhD
The Competing Values Framework was developed initially from research conducted by University of Michigan faculty members on the major indicators of effective organizational performance. It has been found to be an extremely useful model for organizing and understanding a wide variety of organizational and individual phenomena, including theories of organizational effectiveness, leadership competencies, organizational culture, organizational design, stages of life cycle development, organizational quality, leadership roles, financial strategy, information processing, and brain functioning. The robustness of the framework is one of its greatest strengths. In fact, the framework has been identified as one of the 40 most important frameworks in the history of business.
Approximately 20 years ago, the framework emerged from research on the criteria that predict if an organization performs effectively. Those investigations were followed by studies of organizational culture, leadership roles, management skills, and information processing styles. From these empirical studies, two major dimensions consistently emerged. One dimension differentiates an emphasis on flexibility, discretion, and dynamism from an emphasis on stability, order, and control. For example, some organizations and managers are viewed as effective if they are changing, adaptable, and transformational. Other organizations and managers are viewed as effective if they are stable, predictable, and consistent. This continuum ranges from versatility and pliability on one end to steadiness and durability on the other end.
The second dimension differentiates an internal orientation with a focus on integration, collaboration, and unity from an external orientation with a focus on differentiation, competition, and rivalry. For example, some organizations and managers are viewed as effective if they have harmonious internal relationships and processes. Others are judged to be effective if they successfully compete against others and establish a market niche. This continuum ranges from cohesion and consonance on the one end to separation and independence on the other.
Since the original research was conducted, these same dimensions have been reproduced in a wide variety of research studies, from cognitive style to human development to philosophy. The framework, in other words, has proven to be very robust across a variety of phenomena, and it describes the core approaches to thinking, behaving, and organizing associated with human activity.
Together these dimensions form four quadrants, each representing a distinct set of organizational and individual factors. They identify, for example, the criteria of effectiveness that must be pursued by organizations, the leadership and managerial competencies that are most effective, the underlying culture of organizations, and so on. What is notable about these four core values is that they represent opposite or competing assumptions. Each dimension highlights a core value that is opposite from the value on the other end of the continuum-i.e., flexibility versus stability, internal versus external. The dimensions, therefore, produce quadrants that are also contradictory or competing on the diagonal. The upper left quadrant identifies values that emphasize an internal, organic focus, whereas the lower right quadrant identifies values that emphasize external, control focus. Similarly, the upper right quadrant identifies values that emphasize external, organic focus whereas the lower left quadrant emphasizes internal, control values.
These competing or opposite values in each quadrant give rise the name for the model, the Competing Values Framework. At the University of Michigan, the Competing Values Framework is used to organize an approach to leadership and management development. Individual leadership competencies, for example, are developed and improved i the context of the organization’s culture, its strategic competencies, financial strategies, pressing problems, and desired outcomes. All of these factors are measured by instruments based on the Competing Values Framework, thus providing an integrated and consistent approach to individual and organizational development and improvement. An illustration of the Competing Values Framework provides an illustration of the key values, leadership types, value drivers, approaches to change, and theories of effectiveness.
Leadership development experiences and executive education programs often focus on competencies and capabilities that reside in each of the four different quadrants of the Framework. The specific leadership tools and techniques that receive emphasis with leadership groups are often determined by the organization’s own culture, aspirations for change, competencies of the senior leadership team, or the data feedback that individuals receive from various assessments.
For example, tools and techniques such a teamwork, collaboration, talent management, empowerment, or inter-personal relationships could be highlighted in the upper left quadrant. The opposite kinds of tools or techniques, such as competitiveness, fast response, decisiveness, driving through barriers, or goal achievement, could be highlighted in the lower right quadrant. This framework also suggests that tools and techniques focused on innovation, creativity, articulating future vision, transformation change, or entrepreneurship could be address in the upper right quadrant. The opposite kinds of tools or techniques, focused on assessing and measuring, controlling processes, structuring, efficiency improvement, or quality enhancement, could be addressed in the lower left quadrant.
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THE COMPETING VALUES FRAMEWORK
The OCAI is a quick culture tool where you distribute 100 points between four “Competing Values”.
These four Competing Values correspond with four types of organizational culture. Every organization has its own mix of these four types of organizational culture.
Internal-External dimension
An organization might have an internal orientation; focusing inward on development, collaboration, integration of activities, coordination. Or it might have an external orientation; looking at the market, what’s possible with the latest technology, what competitors are doing, what customers want, and it could diversify activities as a result.
Both internal and external attention are needed to be successful in the long run - but depending on their environment an organization will have a dominant preference. An agile, volatile market will evoke an external orientation whereas a stable environment will allow for an internal focus.
Note the “competing” nature of the values: you have to choose whether you look inside or outside - you cannot do both at the same time.
Stability-Flexibility Dimension
The second defining dimension is the focus on stability or flexibility — organizations that prefer to organize for stability value clear structures, planning, budgets, and reliability. They assume that reality can be known and controlled. Organizations that organize with flexibility assume the opposite: you can never predict and control everything. They prefer a flexible attitude and organization to adapt quickly to changing circumstances - focusing more on people and activities than on structure, procedures, and plans.
The “competing values” nature of stability and flexibility prevents you from doing both at the same time. Organizations can spend their money, attention, and time only once, so they tend to emphasize certain values. Quinn and Cameron found that flexible organizations are most effective, which sometimes leads to contradictory behavior. The “best” organizations use all four value sets when necessary.
A culture type works best in the activities domain that aligns with its values. In the health care sector, for instance, we often see clan culture.
Beware: there is no ultimate “best” organizational culture prescribed by the Competing Values Framework. The model is descriptive.
In a specific domain or market, one culture type might fit better than another, and this is for the organization to decide. "When would be at our best?"
When you map those two polarities in a 2x2 matrix, you see four culture types emerge.
The Competing Values Framework is validated by a ton of research (Denison, 1990; Howard, 1998; Deshpande & Farley, 2004). It is aligned with other dimensions that describe how people behave when organizing (Linnenluecke, 2010; Ralston, Tong, Terpstra, Wang & Egri, 2006; Cameron & Quinn, 2006).
These underlying dimensions of organizing exist in all human and organizational activity. It aligns with the four biological determined drives in the brain: the need to bond, to learn, to acquire, and to defend. (Paul Lawrence, Nitin Nohria, 2002).
The CVF and OCAI can also be related to the “Big Five” personality traits, the MBTI, and the four psychological types discovered by Carl Gustav Jung.
Because of this conceptual “archetypical” basis, the Competing Values Framework can integrate many other organizational culture instruments.
This scientific basis is excellent but what is best is its practical applicability. The CVF helps you see what people value and emphasize when they organize activities, whether they are in a for-profit organization, a sports club, local community, or a family. The framework shows where you are and where you’d like to go.
Organizational Culture Types
Mapping those two dimensions of “competing values” you get four organizational culture types:
the dynamic, entrepreneurial Create Culture
the people-oriented, friendly Collaborate Culture
the process-oriented, structured Control Culture
the results-oriented, competitive Compete Culture
These organizational culture types are also known as Adhocracy culture, Clan culture, Hierarchy culture, and Market culture (Cameron & Quinn).
Create Culture (Adhocracy Culture)
This is a dynamic and creative working environment. Employees take risks. Leaders are seen as innovators and risk takers. Experiments and innovation are a way of bonding. Prominence is emphasized. The long-term goal is to grow and create new resources. The availability of new products or services is seen as a success. The organization promotes individual initiative and freedom.
Do new things: create, innovate, envision the future
Transformational Change
Handle discontinuity, change, and risk
Freedom of thought and action, rule-breaking
Thoughtful experimentation, learning from mistakes, failing fast
Roles like entrepreneurs and visionaries
Visionaries inclined toward risk, not afraid of uncertainty
Typical in sectors like technical start-ups, technology-driven industries (communications, sustainability), but also disruptive services like Airbnb, Uber.
Collaborate Culture (Clan Culture)
This working environment is friendly. People have a lot in common, and it feels like a large family. The leaders are seen as mentors or maybe even father figures. The organization is held together by loyalty and tradition. There is great involvement. They emphasize long-term Human Resource Development. Success is defined within the framework of addressing the needs of the clients and caring for the people. The organization promotes teamwork, participation, and consensus.
Do things together: build teams, people matter
Long-term Change
Commitment, empowerment, cohesion, engagement
Human development
Collective wisdom, long-lasting partnerships, and relationships
Roles like a mentor and a coach
Wary of conflict
Typical in sectors like health care, education, some government agencies, not-for-profits.
Control Culture (Hierarchy Culture)
This is a formalized and structured workplace. Procedures direct what people do. Leaders are proud of efficiency-based coordination and organization. Keeping the organization functioning smoothly is most crucial. Formal rules and policies keep the organization together. The long-term goals are stability and results, paired with an efficient and smooth execution of tasks. Reliable delivery, continuous planning, and low cost define success. The personnel management has to guarantee work and predictability.
Do things right: eliminate errors
Incremental Change
Attention to details, careful decisions, precise analysis
Increase consistency and reliability, well-informed experts
Better processes and efficiency, routines
Roles like organizers and administrators
Conservative, cautious, logical problem solvers
Typical in sectors like medicine, nuclear power, military, government, banking and insurance, transportation.
Compete Culture (Market Culture)
This is a results-based workplace that emphasizes targets, deadlines, and getting things done. People are competitive and focused on goals. Leaders are hard drivers, producers, and rivals. They can be tough with high expectations. The emphasis on winning keeps the organization together. Reputation and success are the most important. Long-term focus is on rival activities and reaching goals. Market dominance, achieving your goals, and great metrics are the definitions of success. Competitive prices and market leadership are important. The organizational style is based on competition.
Do things fast: compete, move fast, play to win
Fast Change
Customer satisfaction, attack competitors, shareholder value
Speed: results-right-now, getting things done, achieving goals
Acquire other firms, outsource selected processes,
Deliver results, make fast decisions, solve problems
Leaders are hard-driving, directive, commanding, demanding
Typical of sectors like consultancy, accountancy, sales and marketing, services, manufacturing.
