Company culture plays an integral role in every organization’s success. When done right, it can motivate, engage and unite entire teams but also appeal to and attract new talent seeking to join a company with distinct cultural practices.
It is no wonder, then, that most organizations today are striving to cultivate their own, distinctive culture — it has, after all, become an invaluable component in today’s modern workplace. That said, company culture can be quite a nuanced and elusive term comprising a range of elements.
Our guide walks you through the meaning of company culture, discusses its importance, considers latest trends, and offers insightful tips that will help you refine your own corporate culture.
What is company culture?
Company culture consists of the shared values, attributes and beliefs that characterize an organization. It encompasses numerous elements including work environment, management style, core company values, mission statement and workplace ethics, and essentially represents the collective ethos of an organization.
Each company creates its own, unique culture through a series of practices which, in turn, define the behaviors, mindset and attitudes shared by employees across all levels.
Why it’s important
Company culture plays a tremendous role in the success and prosperity of an organization, as it shapes its internal and external identity. Not only does it define employees’ experience but it also determines how the organization conducts itself with other stakeholders, including customers, vendors and partners.
In short, it affects the way the company does business but also how it’s perceived by others, both within and beyond the organization. As such, company culture can be a testament to the corporation’s commitment (or lack of) to its core values.
A successful organizational culture can help a company thrive, encouraging healthy team dynamics, innovative spirit, collaboration and improved workflow. On the other hand, an ineffective or weak corporate culture can quickly turn toxic and have detrimental effects on the wellbeing and commitment of staff but also the overall performance of the organization.
The benefits of company culture
When done right, company culture can bring forth incredible results, spanning from better productivity to higher morale and stronger reputation to improved performance. Let’s take a look at some of the most important benefits of company culture below:
1. High retention rates
The Great Resignation saw professionals across multiple industries in the US quitting their jobs at record-breaking levels. According to a Pew Research Center survey, low pay, lack of advancement opportunities and feeling disrespected at work were among the top reasons that led to this economic trend.
A high turnover rate can wreak havoc within an organizational ecosystem; from low morale to workflow disruptions due to staff shortages. So, where does company culture come in?
When time is taken to create an environment that meets employee needs and expectations, companies are able to retain their most talented members and avoid the severe consequences caused by constant resignations. An effective corporate culture can increase job satisfaction levels and encourage employees to develop a sense of belonging and loyalty towards their company. As a result, this can significantly reduce absenteeism and lead to lower turnover rates.
2. Employee engagement
What happens when employees enjoy coming to work every day due to good company culture?
Well, for starters they’re better engaged with the work they do and, as a result, productivity levels are significantly higher. A positive environment that is devoid of toxic office politics, poor management and unfair policies allows your team to focus on their work and achieve more overall.
3. Talent acquisition
A functional company culture not only retains current staff but also attracts prospective talent. In fact, a survey by Glassdoor found that 77% of respondents would consider a company’s culture before applying for a job there.
So, if a company wants to recruit the crème de la crème of job candidates, their culture needs to embody strong values, policies and practices that will ultimately boost talent acquisition and recruitment numbers.
4. Brand identity and reputation
A company that is focused on building a distinct culture will also be able to create a recognizable brand identity and reputation. This not only attracts new talent but also clientele and potential business partners that can contribute to the organization’s overall prosperity.
Take Google, for example: the leading tech giant is not only renowned for its products and services but also for its exceptional company culture that helps it stand out among competitors, making it one of the most desirable companies to work for — and with. Google’s culture actively contributes to its shining reputation, which allows the company to have a more holistic brand identity overall.
5. Employee health and wellbeing
One of the most distinct benefits of good company culture is its positive impact on employee health and wellbeing. Indeed, a company culture that values work–life balance and promotes healthy workplace environments can help teams thrive, both in terms of their career and wellbeing.
Today’s workforce is experiencing alarming levels of burnout and mental health issues, which are leading to high absenteeism as well as resignations. According to Mind Share’s 2021 “Mental Health at Work” report, 76% of respondents said that they experienced at least one symptom of a mental health condition during that year — a 59% increase from 2019.
The report also found that 91% of respondents believed that a company’s culture should support mental health. When organizations take the time to do just that, they will reap the benefits of a happier and healthier workforce.
6. Innovation
A positive work environment can inspire change and innovation. Not only are employees more engaged, as mentioned above, but they’re also more inclined to collaborate with others, brainstorm ideas and communicate their thoughts without fearing repercussions or criticism.
As a result, this fosters unity and trust among team members, helping them develop the company’s goals. When organizational culture is aligned with your team’s values and needs, this can strengthen the sense of a shared purpose, helping them be more innovative, creative and open.
Culture trends
In 2022, we are seeing new cultural trends emerge in the corporate world. As companies are bouncing back and entering the post-COVID-19 era, a series of new policies and behaviors are being adopted to keep up with competition, meet employee needs and stay in sync with industry trends. Below, we have listed the most prominent culture trends in 2022:
1. Remote and hybrid work opportunities
Remote work is here to stay! While organizations are asking employees to return to the office, it seems that the majority of those who had to work from home during the height of the pandemic want to keep their remote work format. According to findings by the Pew Research Center, 61% of workers are choosing not to go into their workplace.
As a result, companies are integrating remote and hybrid work within their culture, granting their employees more flexibility and autonomy over their work.
2. Development opportunities
More and more companies are realizing the true value of offering development opportunities to their employees. By offering training opportunities through online courses, workshops, educational sponsorships and specialized programs, employers are encouraging their staff to sharpen their expertise and expand their skillset. This not only positively impacts the company’s performance but also keeps employees engaged and loyal to the organization.
3. Employee recognition
Employee recognition plays a fundamental role in job satisfaction. A company culture that celebrates staff achievements, commemorates milestones and encourages giving credit where it’s due can transform productivity and happiness levels.
For this reason, organizations are placing more emphasis on employee recognition programs that will allow them to celebrate their teams and show their appreciation for their contributions.
4. Diversity and inclusion
While a diverse and inclusive workplace should be the bare minimum that every company offers, there’s still a long way to go. That said, younger employees are becoming a driving force for change. According to a 2020 Glassdoor survey, 76% of employees and job seekers said that a diverse workforce is a major consideration when evaluating companies and job offers.
Numerous companies are now striving to cultivate an inclusive culture that is free of discrimination and bias through a series of policies and schemes.
5. Tech and digital tool integration
It’s no lie that COVID-19 pushed most businesses to adopt new digital tools and technologies to minimize the disruption of work processes and operations.
Today, the utility of these digital tools prevails as most companies continue to rely on online video conferencing platforms, social media, cloud software and project management apps to streamline their operations and improve employee experience.
How to improve company culture
While some companies are strategic and tactical about their company culture, others allow it to develop organically through their day-to-day operations. Whatever your approach may be, company culture can always be refined and tweaked. After all, it should not be static; it needs to grow and reflect the newest developments and goals of the organization.
Here’s how you can make more improvements to your company’s culture:
Step 1: Outline values and set clear goals
Clear values and goals are the backbone of a successful culture. By outlining a set of objectives, you’re creating a common purpose that everyone is striving towards. Not only can having goals and values motivate current staff and establish unity, but it also attracts new recruits that identify with the company’s purpose.
To succeed, you not only need to define your company’s core values and primary goals, but also ensure that you embody them in every aspect of your business — from corporate policies and team projects to leadership style.
Step 2: Focus on fostering employee relationships
Company culture cannot exist without the people within your organization. Indeed, company culture is defined by the ways in which employees interact with each other, both inside and outside the workplace.
As an employer, it’s crucial to invest in building solid employee relationships through team-building activities, collaborative projects and team events. These initiatives will allow your staff members to break the ice and form meaningful relationships that will allow your organization to flourish.
Step 3: Prioritize organizational transparency
A transparent culture helps employees feel more engaged within their roles. When everyone is kept in the loop, you can avoid communication breakdowns and grievances among your team but also build trust among everyone.
In order to create more transparency, you need open communication channels where successes, failures and challenges are shared with everyone across the organization.
Step 4: Provide more flexibility and autonomy
By offering flexible work options, you’re building a culture that recognizes and accommodates its employees’ needs.
Whether it’s flexible hours, remote work options or job sharing, you are granting your staff autonomy over their work while allowing them to manage other responsibilities outside the office without the strains of a rigid and outdated 9–5 schedule. As a result, you’ll have a happier, more engaged team and a much lower turnover rate, as employees won’t feel the need to seek out more flexible roles elsewhere.
Step 5: Conduct regular cultural audits
As mentioned above, company culture cannot remain static. For this reason, regular audits are a crucial component of building and maintaining a successful culture within your organization.
So, how can you go about this? For starters, you can use a consulting service that will assess your workplace and provide you with the necessary tools to make any required changes. If you don’t want to involve third parties, then you could host open discussions among your employees where everyone can share their thoughts on your current culture, or create an anonymous survey where people can freely share their feedback and opinions.
Step 6: Recognize your team’s efforts
Employee recognition plays a key role in a company’s overall success. After all, we all love it when our achievements and efforts are recognized by others.
To create a culture that praises your team’s accomplishments and services, you must focus on building effective recognition programs that will praise and reward your employees.
Key takeaways
In simple terms, company culture is shaped by the core values, attributes and behaviors embodied within an organization. When successful, it can actively contribute to higher job satisfaction rates, lower turnover, and improved engagement and innovation among your staff. It can also allow your company to establish a strong brand name through recognizable corporate practices and ethos.
So, if you want your business and team to thrive, a good company culture is a sure-fire way to make that happen!
What do you think makes a great company culture stand out? Share your thoughts with us in the comments section below!
Originally published on October 17, 2016.