Definition
Company culture describes the shared characteristics of an organization; this includes your values, mission and goals, practices, and attitudes. However, other aspects also contribute to work cultures, such as the working environment, company policies, and employee behavior.
Company culture is also described as a shared spirit. Or as Brian Chesky, Co-Founder, and CEO of Airbnb, says, “Culture is simply a shared way of doing something with a passion.” It’s how employees feel about their work, their values, where they see the organization going, and how they achieve those goals.
And these qualities are crucial, as the environment employees spend their time in impacts their experience. For example, they’re more likely to engage and perform well if they feel aligned with the company culture. Likewise, employees may lose interest, underperform, or leave altogether if their needs aren’t met.
What is company culture?
The term “company culture” is thrown around often, with organizations struggling to wrap their collective arms around it. Defining it is challenging, as it’s a unique set of attributes that combine to create “culture” at each organization. Strong organizational culture is important, but also comes with some specific challenges and successes are common, and we will explore each below. Along the way, we’ll make a case for paying attention to your company culture and why it matters.
What company culture is not
Sometimes people confuse a type of workplace environment for company culture. What do we mean by this? For example, an organization may provide free coffee or snacks. Or, like Google, have an indoor rock-climbing wall. Or even game night and an ugly sweater party. These things are not company culture.
Though they sound fun, they are a job’s perks and indicative of a workplace environment that offers interactive events. And these perks may even stem from company culture, but they are not, in themselves, the culture of an organization. For example, a worker could have a great time at the company bowling night but still feel frustrated and undervalued.
Why it’s important
Creating, defining, and protecting your company culture is critical to the success of your organization. And its importance is multi-faceted.
Company culture defines your organization’s internal and external identity
Your company culture defines how people view your organization, internally for employees and externally for the world. This includes how you treat one another as co-workers and how your people interact with the outside world, specifically with customers, suppliers, partners, etc.
These interactions become your identity and are a determining factor in people and customer perception.
Company culture reflects your core values
How do you approach your workflow? How do you manage your team? How do you deal with unhappy customers? How you and your employees conduct business should reflect who you are as an organization. Put plainly: You need to walk the walk if you’re going to talk the talk.
If your values do not match your actions, that’s a big issue. You will lose credibility in the eyes of both your employees and customers.
Company culture can turn your employees into advocates
If employees feel their efforts at your organization matter, they can become your most powerful advocates. As an advocate, they contribute to your company culture and gush about their experiences with other coworkers, friends, and family, both online and offline.
Likewise, if they’re unhappy, they’ll continue to talk. But instead of being your best advocate, they’ll become your worst critic—possibly damaging your company’s brand and, by extension, its culture.
Company culture helps you attract and retain talent
Today, a company culture focused on people has a profound draw. Business News Daily reports that “employees say company culture is a top priority for potential jobs.” People are always searching for the next opportunity, and ‘culture’ can be the deciding factor for many job seekers, particularly when that culture aligns with their values.
Culture resonates with people’s desire to feel good about their work and where they work—a place they can speak of with pride. And a solid organizational culture is critical. Forbes reports, “A strong company culture is the best retention strategy,” especially with the reemergence of quiet quitting following on the heels of the Great Resignation.
Establishing your company culture begins with onboarding, as this sets the stage for the entire employee experience. New hire onboarding should offer a welcoming, organized experience that introduces them to a single source of truth that will act as an information and internal communication hub. A place designed to help them experience successful outcomes through a series of learnings and activities that make sense.
Simply put, if you’re meeting the needs of your employees from day one and helping them feel as if they are part of a team, they will want to stay.
Reshaping your culture into a team
A solid organizational culture keeps your people aligned. Different perspectives have room to flourish when your culture is transparent, sets behavioral expectations, and creates guidance to support working together as a team. There are no hidden agendas but a cohesive common goal.
In short, company culture can break down silos if you let it. And it leads to better decision-making and streamlined processes—creating a better team experience.
Organizational culture impacts performance and employee well-being
Keeping employee well-being top of mind is essential. It allows workers to show up as their best selves when emotionally supported. Forbes describes this as “the price of admission for garnering high employee engagement.”
There is a direct impact on performance when employees feel burnt out or pushed too hard and unable to vocalize it for fear of repercussions. Business.com says this can lead to “chronic fatigue, disengagement, low motivation, and poor performance.” Therefore, creating a company culture that can check in and support employees is critical to maintaining a productive and positive workforce.
Factors that contribute to creating an optimal culture
Company culture is a way of life for your employees, and there are some critical factors to consider that influence your employee’s experience.
Leadership
The values of leadership trickle downward and affect employees. Therefore, outstanding leadership should personify company culture with action-upholding organizational policies, procedures, and rules.
Business purpose
The nature of your business can impact employee behavior. For example, how is your organization contributing to the world or specific industry in a meaningful way? The underlying purpose or mission your organization works to achieve and how it operates daily in pursuit of that purpose directly impacts how employees feel toward you. And all this ultimately affects company culture.
Company values
Company values serve as a foundation for company culture. They guide your policies and behaviors to help nurture a thriving and inclusive teamwork culture where employees are proud to tell everyone they meet about their work—and their teammates.
Customers
Clients and customers are a fundamental part of organizational culture. As a result, they have the power to influence employee attitudes. For example, a happy client equals a happy employee, which leads to a more joyful work environment. Likewise, an angry customer equals a frustrated employee, which can affect employee morale.
Recruitment
Your employees have the most significant influence on company culture, so recruiting the right ones is crucial to protecting your culture.
Types of company culture
There are four types of company culture based on shared values, attitudes, and practices. We’ve sorted them below:
Collaborative
This approach is people-focused and values collaboration. It enables an environment where each employee has a voice and is appreciated. Communication takes a special role in breaking down barriers between employees and leadership.
Adhocracy
This method is innovative at its heart and seeks to create the next big thing in the industry. Risk-taking is part of its nature, and it puts a priority on creativity and individuality. Typically, its goals focus on transforming new ideas into market growth.
Market
Results! This approach is very outcome-oriented. Value is placed on the bottom line, i.e., meeting quotas, reaching targets, capturing qualified leads, end-of-quarter results, etc. And this can create a natural barrier between leadership and employees when this is the sole (or even primary) focus.
Hierarchy
Let’s say valuing the employee experience may not be at the top of the list for this type of company culture. Hierarchy thrives off of well-defined processes, stability, and uniformity. Risk-taking is not a thing they do well, and there are multiple degrees of separation between leadership and employees.
Six tips to build effective company culture
Building a compelling company culture requires organizations to consider what work culture means. Here are six valuable tips to help you navigate.
1. Define your values
Defining your values is what dictates all aspects of company culture. That includes how people treat each other and what employees can expect from work. It’s these values that will be the foundation of your company culture.
2. Set goals
How do you want to bring your organizational values into your culture? For example, you must prioritize your inclusivity goals if diversity is important to you. In action, this might mean increasing the retention rate or acquisition rate of diverse employees. The point is that company culture, without action, is just an abstract idea.
3. Be transparent/get feedback
Be open and transparent about your ideas and goals and gather feedback. Ask your team what they’d like to see or if they have differing opinions. After all, company culture will impact your employees most; by being transparent and open, you can build a culture that works for both company and the employees.
4. Develop what a day-to-day work experience should look like
It’s time to think about how you will bring company culture to life in the daily work environment. Culture is how employees experience you, so having a plan is crucial. For example, it’s one thing to have diversity goals, but without defining what that looks like, it’s talk. Bringing this goal to life could mean paid holiday leave for celebrations specific to an employee’s culture/ethnicity.
5. Utilize modern digital tools to streamline
We cannot emphasize the value of digital tools in the workplace enough. They can connect employees remotely or in the office, nurturing a cohesive company culture. They can streamline workloads, make onboarding a breeze, and gauge employee engagement.
6. Build relationships
Building relationships may be last on our list, but it’s possibly one of the most critical aspects of company culture. Creating ways for employees to connect that aren’t solely work-focused is essential for team cohesiveness. Employees will feel more comfortable working together as they get to know one another. And these feelings will foster a work environment where they feel safe, appreciated, and supported. And when employees feel this way, they are more likely to be engaged.
Check out our blog to learn how to build trust in the workplace
How to improve company culture
Even if you just realized that things need to shift within your company culture, there are ways you can immediately begin to implement change. We’ve detailed some below.
Appreciation as a part of your culture
It’s lovely to be recognized for your hard work. So, giving employees recognition can not only improve engagement, but it’s also a great place to start. And not every employee wants recognition in the same way, according to Forbes, so finding ways to show appreciation in a way that is most meaningful for an employee is vital. Ensure you’re sincere; employees can tell if you feel obligated.
Offer flexibility
Flexibility was a top requirement for employees in 2022, according to The Top 10 Workplace Trends by LinkedIn. From hybrid options to working remotely, employees are looking for more work/life balance and flexibility that will allow them more time. This may include offering employees flexible work hours or allowing them to work most days remotely.
Competitive compensation
Your company culture could be fantastic, but if your employees are underpaid, they won’t stay. Educating yourself on competitive salaries and benefits will ensure you’re offering your team the best.
Establish employee feedback
You can’t fix what you don’t know is broken. Opening up communication between leadership and employees improves employee experience. Forbes found that “74% of employees report they are more effective at their job when they feel heard.” Listening to what employees say values company culture and growth significantly.
Examples
You’ve read the information and looked at the tips for creating a great company culture–but what does the ideal company culture look like in action? Your organization can only answer this as it is specific to you. Some companies associate themselves with a particular set of values, defining themselves as “sustainable” or “inclusive.” No matter how you express yourself, your company culture must reflect your organization and the people making it up.
Luckily, we have some fantastic examples of company culture to inspire you. Here are three organizations that speak for themselves.
SecureLink
SecureLink is a security platform for technology vendors, and diversity is at the heart of their company culture. What makes them stand out is their diverse hiring process. They go outside of the tech realm when looking for new talent. Instead, they hire various people from diverse backgrounds, such as teachers and firefighters. In addition, they look for a passion for learning over education. Their philosophy is that people are teachable and those who are passionate to learn to stay motivated and engaged, and this upstages experience.
Alphabet Inc.
Alphabet inc is a holding company for the internet giant Google. It’s known for its employee-centric culture and offering employees a creative and flexible working environment.
And employees are genuinely happy to work there. According to Comparably, Alphabet inc has an 82% favorable employee review. They also rank in the top 50% for diversity, 94% of employees report looking forward to working with their team each day, and 87% of employees describe their work environment as favorable. And their culture score? It’s an A.
Amazon
Everyone’s favorite shopping app. It’s known for its almost unmatched customer service, which aligns with its goals: “Amazon is guided by four principles: customer obsession rather than competitor focus, passion for invention, commitment to operational excellence, and long-term thinking.” Amazon is continuously evolving to meet customer needs and stay up to date with the latest eCommerce trends. Employees report being happy–62% being satisfied with their work/life balance, and 77% of employees saying their work life is positive.
Technology
We mentioned earlier that digital tools could assist organizations looking to streamline their workload and create a more cohesive culture. And we stand by technology playing a role in company culture. Writers Block found that “96% of managers responsible for employee productivity think key technologies are beneficial.” Here’s how technology plays an active role in company culture.
Communications
Any relationship can be made or broken by communication. And this is true of corporate communications as well. With employees spread out, it’s critical to keep the lines of communication not just open but transparent. Empowering your team with streamlined ways to communicate (and collaborate) improves engagement and reduces the risk of frustration or even miscommunication.
Productivity
Staying productive is an essential part of company culture. However, employees can become frustrated by outdated technology and methods. If your workplace tech makes it hard to do their jobs, they will become disengaged and dissatisfied with their work. Instead, you can increase productivity and foster a positive company culture by providing AI-empowered technology that makes it easier for them to complete tasks.
Innovation and creativity
Everything is evolving, and your organizations must stay on the cusp of cutting-edge technology to stay relevant and offer a suitable workplace. When you value your employees’ digital workplace experience, they will turn to tech to look for new ways to accomplish their work. It creates a forward-thinking atmosphere, eliminating stagnant pools.
Relationships
There’s that word again—relationships. Your employees need to know their co-workers. Meeting everyone on their team can be challenging with so many remote workers. Creating a virtual water cooler where teammates and employees can check in on one another, encourage each other, and chew the fat, is paramount to happy company culture.
And a tool that brings all of this together is an intranet. The technology provides compliance responsibilities with equitable access that is fair and monitored. It can not only be a communications tool; Organizations can use an intranet to help create and promote a positive company culture. If you want to know more, reach out for a demo!