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  • Writer's pictureDebbie Vega

The Importance of Company Culture

Company culture has grown in popularity as a corporate buzzword. But what exactly is company culture, and why does it matter? While there is no exact definition of company culture, you can think of it as the personality of a company, broken down into two parts - purpose and values. Purpose refers to why your company exists, the drive that continues to push your company forward. On the other hand, values refer to the core beliefs and behaviors that define how a company does things.

Like most things, company culture can do more harm than good if mismanaged. Read below to find out why company culture matters and how to make sure it benefits your employees.

The Benefits of Company Culture

1. Increased Motivation

While it is important that your employees enjoy their jobs, that alone is not enough. They also need to be able to find purpose in their work and fulfill their own professional goals. Companies whose cultures prioritize these three elements and actively encourage their employees often see a 41% reduction in absenteeism and a 17% increase in productivity.

2. Better Employee Retention

Hiring amazing people is only half the battle. Retention is where the real work is. Money is no longer the primary motivator for employees in most cases. They expect a work environment that encourages collaboration, critical thinking, and rewards positive behavior. Companies that develop highly engaged business cultures experience 59% less turnover than those who don’t.

3. Better Decision Making

Clear, well-defined mission, vision, and corporate values empower employees to make sound decisions. It provides a framework for employees to use as a reference and answer any question that arises during the decision making process. Clearly defined company culture will help your employees make decisions that consistently align with company goals.

When Company Culture Is Mismanaged

Unfortunately, in some cases, company culture can become toxic. It often leads to micromanagement, poor communication, and leniency towards bad habits as leaders and upper-level management set precedents that work against company interest, regardless of their intent. These actions discourage employees and create a less inviting work environment. Fortunately, there are multiple ways to ensure your company culture is working correctly and benefiting both your employees and your company.

How to Avoid Negative Company Culture

1. Improve Communication

Company culture is not a solo project. Creating an environment that actively encourages employees and leaders alike to express their ideas, opinions, and emotions creates a more trustworthy workplace. It develops the kind of collaborative environment needed to ensure people are on board with company initiatives, and that any and all concerns are addressed.

2. Identify the roots of the Problems.

Problems may arise from time to time, no matter how good your company culture may be. You must find the root of the issues instead of merely treating the symptoms of it. By doing so, you can both eliminate the problem itself and reduce the likelihood the same problem will happen again. Getting to the root of the issues sets a positive precedent for your employees, and shows that you care about their concerns.

3. Use A Cultural Assessment Instrument.

In most cases, seeing an objective perspective could be exactly what you need to truly understand your company. Using an optimization instrument like Predictive Index, can you provide you with an in-depth analysis of both your company and employees. These results can help you understand how best to motivate and communicate with your employees, address problems as they arise, and steadily grow your business. An outside perspective can help you reinforce the best parts of your company culture while working to improve the rest.

Company culture is now more important than ever. Contact us today if you’re ready to build a lasting and positive culture for your company.

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