insight

The Smell of the Place: A reflection on organisational culture

Sumantra Ghoshal, a renowned professor and management thinker, introduced the metaphor of "The Smell of the Place" in one of his lectures at the World Economic Forum.

His insights, encapsulated in this metaphor, highlight the profound impact of organisational culture on employee behaviour, motivation, and performance. Ghoshal's reflections resonate deeply with managers, leaders, and employees alike, as they unravel the intangible yet influential dynamics that shape workplaces.

Understanding "The Smell of the Place"

Ghoshal begins by drawing an evocative comparison between two distinct environments: the vibrant and invigorating atmosphere of the Fontainebleau forest in France and the stifling, oppressive conditions of summer in Calcutta (now Kolkata), India. The Fontainebleau forest, with its open spaces, fresh air, and natural beauty, symbolises a nurturing and enabling work environment. In contrast, the sweltering, humid streets of Calcutta reflect a stifling and demotivating workplace.

The "smell of the place," as Ghoshal describes it, is not a literal scent but a metaphor for the prevailing organisational culture—the unspoken norms, values, and attitudes that define how people feel and behave at work. It is the invisible yet palpable atmosphere that shapes employees' perceptions, energy levels, and productivity.

The Four Dimensions of the Organisational Environment

Ghoshal identifies four critical dimensions that contribute to the "smell of the place.". Each dimension reflects a different aspect of how an organisation operates and influences its people:

Stretch vs. Constraint

In an enabling environment, there is a sense of stretch—a collective belief that individuals can achieve more and surpass expectations. Employees feel empowered to take initiative, experiment, and grow. Conversely, a constraining environment imposes rigid rules, excessive controls, and bureaucratic hurdles, stifling creativity and ambition.

Discipline vs. Compliance

Discipline in a positive sense reflects self-motivation and shared accountability. Employees are guided by a clear vision and intrinsic commitment to excellence. On the other hand, a compliance-driven culture focuses on micromanagement, external control, and fear of failure, which often leads to disengagement and mediocrity.

Support vs. Neglect

A supportive workplace fosters trust, collaboration, and open communication. Leaders act as mentors, encouraging their teams and providing the resources needed to succeed. In a neglectful environment, employees are left to fend for themselves, leading to frustration, burnout, and low morale.

Trust vs. Control

Trust is the cornerstone of an inspiring culture. It allows employees to take risks, innovate, and learn from failures without fear of punitive consequences. In contrast, a control-orientated environment fosters suspicion, mistrust, and a reluctance to step outside one's comfort zone.

The Role of Leadership

Ghoshal emphasises that the "smell of the place" is not static; it evolves with leadership, policies, and the actions of individuals within the organisation. Leaders play a pivotal role in shaping and maintaining an enabling culture. They set the tone by modelling behaviours, communicating values, and creating an environment where employees feel valued and motivated.

A leader who fosters trust, encourages stretch, supports collaboration, and disciplines with respect can transform even a constraining environment into an enabling one. On the contrary, authoritarian leadership, excessive bureaucracy, or a lack of empathy can create a toxic atmosphere, regardless of the organisation's size or success.

From a Stifling to an Enabling Environment

Ghoshal challenges managers and organisations to reflect on their cultural environment and take proactive steps to improve it. Transitioning from a stifling to an enabling culture requires a deliberate and sustained effort, including:

Promoting Open Dialogue: Encourage employees to voice their ideas, concerns, and feedback without fear of judgement. 

Empowering Teams: Provide autonomy and opportunities for employees to take ownership of their work. 

Recognising and Rewarding Efforts: Celebrate achievements and recognise contributions to foster a sense of pride and belonging.

Cultivating Trust: Build strong relationships based on mutual respect and transparency.

Encouraging Continuous Learning: Create a culture where employees can experiment, fail, and grow without fear of retribution.

Practical Implications for Organisations

The insights from "The Smell of the Place" have significant implications for modern organisations navigating dynamic and competitive environments. As workplaces evolve, especially with the rise of hybrid models, remote work, and digital transformation, maintaining a positive "smell" becomes even more critical.

Organisations must focus not only on financial metrics but also on intangible factors like employee engagement, well-being, and cultural alignment. These elements directly impact innovation, collaboration, and customer satisfaction—key drivers of sustainable success.

A Personal Responsibility

Ghoshal's metaphor is not just a call to action for leaders but also for individuals at every level. Each employee contributes to the organisation's culture through their actions, attitudes, and interactions. By fostering positivity, showing empathy, and embracing accountability, every individual can enhance the "smell" of their workplace. 

Conclusion

"The Smell of the Place" is a timeless reminder of the power of organisational culture in shaping human behaviour and performance. Sumantra Ghoshal's vivid metaphor encourages us to look beyond policies and procedures to the deeper, often unspoken elements that define our workplaces.

By nurturing a culture that empowers, supports, and trusts its people, organisations can create an environment as refreshing and invigorating as the Fontainebleau forest—a place where employees thrive, innovate, and achieve their full potential. The challenge lies in recognising the

"smell" of one's organisation and taking purposeful steps to transform it into a fragrance of growth, energy, and inspiration.

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