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What Is Company Culture?
The short answer is that company culture includes the shared values, beliefs, attitudes, and behaviors that characterize an organization. The company’s mission, vision, and goals often shape these values and set a platform for actions and communication.
Although it is a hot topic for many growing businesses, defining a workplace culture can be elusive. To add another layer of complexity, company culture constantly evolves, so having a set definition can be difficult.
The Importance of a Strong Company Culture
Company culture is a powerful player in every business setting. It helps to foster employee engagement, satisfaction, and productivity.
Engagement & Productivity
What brings teams to work every day?
Besides the paycheck, it’s the workplace culture that makes employees feel comfortable and energized to produce their best. Cultures like these are intentional and set the tone for how work is done, decisions are made, and how team members are treated within the organization.
Talent Acquisition
A robust company culture also positively affects recruitment. Companies with a positive culture tend to attract talent, keep their employees happy long-term, and reduce turnover. This boosts your company’s reputation, making your business a desired workplace.
4 Company Culture Examples
About 90% of organizations can be grouped into four main types of company culture. Although these categories could be further divided into subcategories, they represent the primary types prevalent in the workplace.
1. Clan Culture
It is a community-focused workplace similar to a family, with a warm and friendly environment. Loyalty and tradition bind the organization together, and the focus is on nurturing interpersonal skills for long-term benefits. Success is often measured through customer satisfaction and employee well-being.
2. Hierarchy Culture
A hierarchy culture creates a highly formal and structured workplace that relies on rules and policies to keep processes running smoothly. Businesses with this company culture are concerned with stability and achieving results through efficiency, consistency, and well-planned execution. Keeping costs low and ensuring streamlined teams are priorities.
3. Market Culture
In a market culture, the focus is squarely on results, prioritizing the efficient completion of tasks. Here, employees are inclined to aim high, act swiftly, and are motivated by clearly defined objectives, all with a collective commitment to achieving success. Gauging success relies on market share and penetration, fueled by an unwavering determination to outperform competitors in a highly competitive business landscape.
4. Adhocracy Culture
This one highlights the importance of quick pivoting. It’s a dynamic culture that is creative and takes risks. Employees are typically encouraged to push boundaries with leaders who drive their organization forward through experimentation. Strategies revolve around growth, innovation, and pioneering new ideas. It is a flexible and somewhat informal culture mirrored by many startups to grow by leaps and bounds.
What Does a Healthy Company Culture Look Like?
You know you have a positive and healthy company culture when employees feel valued, respected, and empowered. It promotes teamwork and a sense of belonging while reducing turnover.
For example, most people would enjoy working for a company that respects their life outside of work and the need to occasionally take time off to deal with sick children, go to appointments, or visit relatives.
Employees also appreciate the verbal and public acknowledgment of achievements—this can be accomplished during meetings, over company-wide emails, or even as an announcement pinned up on a bulletin board. Even something as simple as free coffee or donuts in the morning is a perk that makes many people feel valued.
“It’s important for leaders to be genuine and transparent, showing they value integrity and connection with their team over simply projecting an image of flawlessness.”
– Shivani Puri, VP of People Operations at Wizehire
A toxic company culture, filled with negativity and micromanagement, often leads to stress, burnout, and disengagement.
For instance, a hostile work environment often stems from systemic issues or confrontational colleagues. Almost one in five workers feel that they face a hostile environment at work, whether through harassment, bullying, or discrimination.
Wizehire’s Women in Leadership Report revealed that 13% of Americans believe hostile work environments create barriers to leadership for women. Also, these conditions usually lead to high turnover and employee burnout for all workers.
Remember, a healthy company culture provides:
- clear values
- open communication
- respect and inclusivity
- continuous learning
- work-life balance
- recognition and reward
How To Build a Successful Company Culture
A brand identity has internal and external components. For example, the company’s mission, nature of relationships, and market position work together to shape how a company is perceived. Knowing what your company stands for is the first step in building a culture that aligns with your core values.
Once you have a firm grasp of your company’s brand identity, you can focus on evaluating and improving your company culture based on how it integrates with those core values.
Evaluating Your Company’s Culture
Evaluating your company’s culture provides metrics on what to improve for external goals, internal engagement, and retention. Employers can use methods like these to get a good sense of their current culture.
- Use surveys to gather employee feedback on their perceptions of the workplace culture.
- Measure levels of employee engagement through interviews or focus groups.
- Observe employees’ interactions with each other, management, and customers to gauge their norms and values.
- Evaluate company policies, procedures, and practices to see how they align with the desired culture and values.
Improving Your Company’s Culture
Company culture is dynamic; it should evolve continuously to remain healthy and effective. After you’ve evaluated your organization and assessed its current state, you can take steps to create the type of work environment you want to implement.
- Address gaps and challenges: Compare the current culture with the desired culture to identify areas with discrepancies or challenges and address any harmful cultural elements.
- Leadership alignment: Offer training and development programs to give managers the skills and knowledge to create a positive and inclusive culture.
- Foster communication: Create channels for open communication and feedback, such as meetings, suggestion boxes, or anonymous surveys.
- Promote diversity and inclusion: Implement policies and practices to address unconscious biases and promote allyship in the workplace among all employees.
- Recognize and reward positive behavior: Acknowledge employees who exemplify the company’s values and create opportunities for employees to celebrate each other’s accomplishments.
- Encourage work-life balance: Implement initiatives that support work-life balance, such as flexible work arrangements, wellness programs, and mental health resources.
Wize Words
The best culture for any company is a pleasant work environment where individuals feel supported and empowered to bring their best selves to work daily. The goal is to build an organization with trust, respect, and a lasting impact. Training leaders and human resource professionals to create a thriving, healthy culture can propel any organization toward tremendous success.
Frequently Asked Questions
There are a few reasons an existing company culture needs to be changed. Sometimes, a culture does not align with the company’s desired strategy, prompting a shift in vision or talent optimization. In other scenarios, your organization’s culture may be behind competitors (such as implementing remote work or using Zoom for meetings). Another reason to change an existing culture is if you have an environment that’s having a negative impact employee engagement.
A company’s culture has a significant impact on customer outcomes. It shapes the way employees behave, their attitudes, and their interactions. A positive culture encourages employee engagement, improving customer service, product quality, and innovation. However, if the company culture is toxic, it can result in negative customer experiences, decreased loyalty, and, ultimately, poor business outcomes.
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