What Is Company Culture?

company culture

Company culture is defined as a shared set of goals, practices, and a general attitude of the company. Company culture is not necessarily a formal program. Instead, it focuses more on the environment, employees, and values. The company's working environment, leadership, goals, and values are all vital parts of a company's culture. How employees interact with each other, their leadership and outside forces also help enforce a company culture.  Some common words that describe a corporate culture include; flexible, challenging, inclusive, collaborative, and motivating. 

Importance of Company Culture 

Why does a company need a culture? Simply put, a company that doesn’t have a strong culture is set to fail. Without a strong, positive culture, companies could lose out on employee retention, a positive work environment, strong leadership, and more. 

An additional risk associated with a lack of company culture is the potential of one building on its own. According to INC, company culture is a “summation of your behaviors.” Employees and leadership are left to their devices if a company doesn’t have clear values and expectations. They can behave how they want (within reason, of course), as the environment becomes a compilation of different cultures. 

“...if people in your company don't have the skills to behave in the way that supports your culture, you'll end up with behaviors that undermine it. As much as your people need to be skilled on the technical side of things, they need to learn how to work in the culture you want. This requires investment in building those skills.”

James Sudakow, INC
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3 Benefits of a Positive Company Culture

Now that we’ve established the importance of having a company culture, let’s discuss three significant benefits of having a positive culture. 

First, A company that has a positive culture will impact employee retention. Employees who are happy at their company are more inclined to stay. Employee retention reduces unnecessary turnover, money spent on training new hires and encourages loyalty. 

Second, company culture impacts employee and company success. Employees that understand the expectations their company has for them. Clear expectations and a positive environment lead to increased productivity and workers ready to go the extra mile for their company. 

Third, companies with a strong, positive culture have increased appreciation between employees and management. This is important because it boosts morale, engagement, and productivity. It also leads to better collaboration overall. 

If you are looking for more reasons to foster a positive workplace culture, here are seven more benefits of a healthy workplace culture. 

Read More: Why Employee Retention Matters

What a Toxic Culture Looks Like

When I think of a positive work environment, some of the first words that come to mind are encouraging, supportive, and constructive. A toxic work environment/culture is the opposite of that. A hostile workplace culture includes poor management styles and unhealthy habits among coworkers. These habits could include gossiping, unhealthy competition, lack of time off/breaks, etc. Toxic cultures also practice bullying, lack of trust, discrimination, and more. These (and more) are all signs of a toxic culture that should be avoided. To learn more, here are ten signs of toxic company culture.

4 Steps to Building A Company Culture

Building an organizational culture may seem daunting. However, as stated earlier, the benefits will be so rewarding. Below are four steps a company can start immediately that will affect their company’s culture. 

Quality Leadership

Before determining and establishing a corporate culture, it is time to evaluate leadership. Leadership has an incredible impact on culture. Leaders set the tone through their actions, such as delegating, interacting with employees, managing work, and leading. 

For example, quality leaders would know what their employees are working/doing at work. However, O.C. Tanner reports that only 54% of employees say their leaders understand what they do while at work. If leaders don’t know what is happening in their company, how can they properly lead/manage employees? 

In that same study from 0.C. Tanner, only 56% of employees feel valued by leadership. It is tough to work in an environment where one doesn’t feel valued by their management. Finding leaders who connect with their employees, are role models, and empower and recognize employees will make a difference in company culture and the employee experience.  

Establish Core Values

A significant first step is establishing core values. What do you want to be at the heart of your company? What words or phrases appear when you think about how your company will be perceived? Getting with colleagues and leaders in the company and getting on the same page is vital to success. 

Below are five examples of core value words/phrases to get started. 

  1. Driven 
  2. Helpful 
  3. Empower Others
  4. Trust
  5. Integrity

BuiltIn has a great list of 49 Core Value Examples from actual companies. Companies like Airbnb, Canva, Headspace, and more all have core values at the heart of their company to help guide leadership and employees. Through using core values, companies have had great success in creating positive work culture.   

Set Goals

After evaluating and finding quality leaders to guide your company’s success and establishing core values, a great next step would be setting goals for your company and employees. Set achievable goals that won’t take too long (it is good to have both long and short-term goals) and ones that support the company's core values. Splitting up goals into categories could be helpful. Below are three categories a company could use when setting goals: 

  1. Personal 

These would be set by leaders and employees and would be specific personal goals that support their particular priorities. Examples include improved team member engagement (individually and as a team) or creating a better work-life balance. 

  1. Departmental

Departmental goals would be set by heads of departments and would be specific for their employees. These could include end-of-quarter goals, collaboration goals, and transparency between management and employees. 

  1. Organizational

Organizational goals would be set by the company's leadership and include themselves and all employees. These could consist of cultural pursuits, well-being goals, and end-of-year goals. 

Following a specific goal-making program is also helpful. S.M.A.R.T. goals (specific, measurable, attainable, relevant, and time-based) is a fantastic guideline for creating goals everyone can achieve. 

Involve Team 

Finally, when creating an organizational culture, it is essential to involve everyone. For larger companies, this may seem complicated, but utilizing technology can be helpful. For example, any company could have a digital survey where employees can voice their concerns and add input on what changes they want to see in a company or what is working within it. Involving the employees in creating a culture is vital to the success of the said culture. 

Involving everyone in the company also helps employees feel like they are making a difference and that their voices are heard (both great ways to foster company culture). 

If you are a hybrid company, strong company culture is very achievable. To learn more, read about creating a culture in a hybrid workplace. 

5 Ways To Maintain A Company Culture 

Maintaining a corporate culture doesn’t have to be complicated; below are five ways companies can keep a culture. 

Careful Hiring

Finding employees that make a good “cultural fit” in the company is essential after establishing and creating a company culture. You don’t want to put in all that work towards creating a culture to have one or a few employees break it down. It is important to note that cultural fit does not mean the personality/interests of an employee. Cultural fit refers to how employees respond to the culture and how they work within the company. 

To avoid hiring someone that may not be a good fit, below are two ways a company can incorporate culture into the hiring process. 

  1. Convey the company culture in hiring materials. 

Your company’s culture shouldn’t be a secret from employees or prospective employees. Ensuring prospective employees know the culture will help them understand what is expected. To learn more, this great article covers 6 HR documents needed to provide excellent company culture.

  1. Decide whether or not you need an onboarding specialist

Onboarding specialists can be a valuable asset to the company. They take the pressure off leaders (allowing them time to focus on other tasks) by taking the bulk of hiring responsibilities. Onboarding specialists can also ensure that potential hires would be a good fit for the company (including culturally). 

Make Training Accessible

Another way companies can ensure their organizational culture is maintained is through employee training. Employee training does not have to be a tedious task that no one looks forward to. Create an accessible employee training program that helps retain employees and build their confidence in their work. Helping employees succeed through training them also helps foster trust and accountability within the company. 

To ensure training is aligned with company culture, below are three tips for success. 

  1. Ensure leadership, the hiring team, and management are all clear on the company culture, brand, and value. The training should align with the company's core values to help employees maintain the culture. 
  2. Re-evaluate the training program yearly to ensure it aligns with core values/culture. Company culture may change as tweaks are made and the company grows, so evaluating a training program every so often is vital to ensuring that old information isn’t being used. 
  3. Get employee feedback on training programs. Involving employees in the training programs is helpful because they are the ones that have to sit through it. They can tell leadership if the training is practical, too dull, or any other problems they may have. Getting employee feedback also helps employees feel heard. 

Open Communication

A company cannot function well if communication isn’t clear, open, and accessible for all employees. Management, employees, and leadership should have access to one another through clear communication. It can be frustrating and discouraging for employees when they cannot get ahold of management for questions or concerns. It is also disappointing for management when employees are not accessible. 

Connect Outside Work 

team building event

Finally, a company that focuses on connection is one set to succeed. Connection outside and inside of work is essential. For larger companies, planning annual family-friendly functions (paying for families to attend a local attraction such as a zoo or amusement park) is a great way to show appreciation and involve families in the company. Smaller companies can focus on team-building events and annual and quarterly family-friendly functions. While these activities may seem like a lot of effort, they improve the employee experience within the company and help maintain a strong company culture. 

Workplace Appreciation

Of course, workplace appreciation is an excellent way to maintain corporate culture. This article about workplace appreciation gives valuable information on whether workplace appreciation works, different ways to convey employee appreciation, and what to avoid when giving recognition. An awesome and fun way to show appreciation for employees, try creating a kudoboard where colleagues and leaders can highlight the employee’s successes. 

Summing It Up 

Organizational/company culture isn’t just something made out of thin air; it does take hard work from everyone involved. There are specific steps to achieve and maintain a company culture. While it may seem daunting to some companies and their leadership, fostering a company culture is rewarding, and your employees will benefit significantly. 

Jenni Berhold

Jenni has been married for over a decade, and is a mother to three children. Jenni loves to help others by offering words of encouragement, advice, or a listening ear. Jenni loves to spend time outdoors, play the ukulele, and be with her family. She believes that every day is worth remembering, especially the good days.