Tight vs Loose Company Culture – Pros and Cons

Modern workplaces don’t require following strict rules on behavior and formal etiquette towards others. The workplace has become more relaxed over the last couple of decades. During the majority of the 20th century, the companies were much more hierarchically inflexible and very strict. As opposed to that, the 21st century has brought us startups and their ways of handling company culture.

Company owners and managers were then left puzzled. After the realization that their company culture can be organized differently, they ask themselves: Which kind of company culture would work best for us? Company culture can be loose or tight, and both of them have their advantages and disadvantages, so there’s really no right answer to that question.

In companies with loose company culture, different departments are able to operate without much coordination between each other, while employees have more autonomy. On the other hand, tightly coupled organizations work in accordance to a more “centralized” operating strategy – management is able to coordinate the activities of all departments and supervisors know precisely what their employees are doing. What would work best for a company simply depends on the owner’s individual preferences and decisions.

Loose Company Culture

One way of functioning is to allow people to perform their tasks without being micromanaged and act like adults. Organizations that tend to keep things loose are usually pleasant places to work. The employees are more likely to give their best when they’re not hassled all the time or when they decide to work from home. Showing respect to employees will result in reciprocal respect from them.

Companies with loose company culture are also known as workplaces where innovation is much better cultivated. People have more authority over their work and are encouraged to solve problems in their own ways, not by following a script. Middle management is responsible for noticing and acknowledging the innovation, and as a result, a loosely organized company can benefit more from their employees’ novelties and revolutionary ways of handling specific tasks. Also, as these companies are used to coming up with new solutions frequently, they have a better approach to unexpected problems and will not be that surprised or dazed whenever there’s a deviation from the everyday routine.

However, there are certain disadvantages to this type of company organization. Namely, when it comes to work hours and resources, there is often an amount of waste because people don’t have a clearly defined process to follow. Thus, employees can get lost in tasks that are not essential for the business, which eventually results in less output. Furthermore, there’s a problem when it comes to employee replacement, because employees tend to balloon when their roles aren’t clearly defined. Losing an employee, in such situations, is more than losing someone that handles a particular role.

Also, when there’s lack of accountability, both managers and employees tend to avoid taking responsibilities for the unexpectedly emerging problems. This can make things difficult for business leaders to discipline and reprimand employees who fail to provide optimal or maximum performance.

Tight Company Culture

Running a tightly organized company has a lot of good sides. For instance, there is little waste in work hours and resources because the hierarchy is clearly defined when everyone has their clearly established roles. People know who they are answering to and what they should be doing. This allows for a strong sense of accountability and a workplace where it’s not hard to find out who’s responsible for mistakes that occur. The number of mistakes that happen because no one is in charge are put down to a minimum.

In these companies, people know what to expect and it is usually seen as a big advantage, because they know they’ll get rewarded if they achieve certain results. Employee policies are clearly defined as well, employees are familiar with the rules and regulations, which prevents situations that may endanger a company’s growth and everyday functioning from happening. Thanks to the digital revolution and various business enhancing software that has emerged in the past decade, and tools such as GPS based attendance tracking software, managers can easily track their employees’ activity, which allows them to track evident recurring mistakes and inconsistencies, and improve their staff’s efficiency to ensure maximum output.

One of the major drawbacks of tight company culture is difficulty in dealing with problems that haven’t been faced before. When emphasis is put on performing tasks a certain way, the employees are not skillful, experienced, or trained enough to solve the unforeseen problems. Paradoxically, a tight company culture can demotivate employees, making the working environment less productive for them, as they don’t know the amount of work required from them.

As for innovation, these kinds of organizations are not really best places for cultivating them. When people are expected to work in accordance to clearly defined rules, they perform the same work in the same way over and over again. Innovative people can’t know whether their innovations will be noticed, and they tend to leave organizations with such company culture.

In practice, it often happens that companies are loosely coupled, while tightly coupled on paper. Attempts to being supervised too closely are usually pushed back by employees. For example, employees would disregard the rules and procedures when their supervisor is watching, but follow them perfectly when he or she is in. So, even if a company’s tight culture is defined on paper, many managers notice the setbacks and allow a looser structure (if they find it more convenient) to create a more relaxed environment in order to keep the company running and have their employees’ give their best performance.