What You Need to Know About Company Culture
Having a strong company culture can improve your employees’ experience at your business. It can also help improve your company’s overall performance by 20 to 30 percent, according to the Harvard Business Review.
So, what is company culture? How do you define yours and make it flourish?
Defining “company culture”
Finding an exact definition of company culture can be challenging. It can mean different things at different companies.
Wikipedia defines organisational culture as the “values and behaviors that contribute to the unique social and psychological environment of a business.”
Investopedia defines corporate culture as the beliefs and behaviors that determine how a company’s employees and management interact and handle outside business transactions. It goes on to say, “A company’s culture will be reflected in its dress code, business hours, office setup, employee benefits, turnover, hiring decisions, treatment of clients, client satisfaction, and every other aspect of operations.”
Other companies talk a lot about company values as a way to define their culture. Harvard Business Review says company culture has six components: vision, values, practices, people, narrative, and place.
So while it can encompass a lot, company culture at its core can be defined as the values your company uses to treat its employees and employees use to treat each other while doing business.
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Why company culture is important
Company culture, or organisational culture, gives your employees a common language to communicate with, based on values and a common goal. Employees who don’t fit with the company culture often enjoy work far less.
Ninety-four percent of executives and 88 percent of employees believe a strong company culture is important to a business’ success, according to Culture IQ.
Businesses that invest in a strong company culture saw up to 4x increase in revenue, according to Forbes. When a company is named to a Best Place to Work list, the company’s stock jumped .75 percent.
Warby Parker, the brand that makes and sells eyeglasses, touts putting its company culture at the forefront as a reason for its success. For example, there’s an entire team within the company that focuses on culture. It sets up team lunches or other events to give team members something to look forward to.
The US online shoe retailer Zappos is well known for its company culture. It conducts cultural fit interviews and even offers new employees $2,000 to quit if the job isn’t for them. Then, each employee has 10 core values instilled in them. Zappos puts company culture first to ensure employee happiness.
How to define your own company culture
While having a strong company culture may sound great, defining your own takes some work — but it pays off.
You may feel like you’re starting from a blank slate, but your company may already have a few great components that just need defining.
Here are some key places to start when thinking about your own company culture:
Vision and purpose: You may think that your company’s mission or purpose is clear, but do your employees buy into it? Employees want to feel as if what they’re doing affects the company’s success and that what they do matters.
Values: While your company’s purpose is what you’re doing and why, an organisation’s values define how employees treat each other and customers or clients. Values can range from “collaboration” to “don’t be evil,” which is one of Google’s. But then Google expands on its values in its “Ten things we know to be true” list. Think about what your company values should be. For example, if your employees work in the field doing something potentially dangerous, you might want to consider “safety” as a value.
People: Once you define your company culture, you need to reflect on your staff. Do your employees embody these core values? Or at the very least have the willingness to embrace the new values you’ve set? As you hire and grow your team, create assessments to ensure new staff members fit with the company culture.
Once you’ve defined your company culture, the next and most important step is communicating it to your team. Company culture can’t sit on a bookshelf — it needs to be lived and breathed by the leadership team and employees. One rollout meeting is not enough, either. Company values and culture need to be discussed and practiced on an ongoing basis to be successful.
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