Company culture isn’t just a “nice to have” part of doing business; it goes a long way toward determining whether your company will be successful or not. But too often company leaders think corporate culture is about things that take employees away from their work — such as ping-pong tables or nap rooms — rather than how employees do their work and what they need to succeed. Understanding corporate culture can help leaders shape it more effectively — and gain the benefits of doing so.
“The business case is simple,” says Nancy Noto, an organizational psychologist and HR consultant. “A leader must have a point of view on what success looks like for their company. Then they must hire people who activate the values that they believe in and who work in the way they know leads to success. Managing culture will ensure the right people work for the company and work in the right way.”
Here’s how company culture adds value to your company.
Belonging Creates Buy-In
One of the most remarkable ways culture adds value to your business is the way it helps employees feel like they belong. Company culture gives employees a standard to measure themselves against, and when it matches up they feel at home. People who feel that sense of belonging in an organization are more likely to work together toward a shared goal, experts say.
“When there’s a strong culture attached to your company, employees feel like they belong to something important and they want to be part of making it better,” says Shraga Jacobowitz, managing partner at ARC Consultants, an HR outsourcing firm. “In turn your employees will love coming to work when they are part of something bigger than themselves. When employees feel like they fit into a company’s culture, they will develop deeper relationships with their colleagues, be more loyal to the company and be more productive than ever.”
The benefits for a company can be numerous: “Having happy, productive employees who are giving their job their all is one of the best things you can do for your company,” Jacobowitz says. “In fact, having a winning company culture cannot be overstated. According to a Bain & Company survey, more than 80 percent of company leaders believe that a company lacking a high-performance culture is doomed to mediocrity.”
Finding people who fit your culture doesn’t just happen, Noto says — it has to be a deliberate strategy. “Managing culture will ensure the right people work for the company and work in the right way,” she says. “This must be done purposefully. Often I hear hiring managers say ‘no’ to someone because they aren’t a culture fit. When I push them on this, I hear vague responses around personality or vibes. This can be dangerous and lead to a lack of diversity in an organization.”
Instead, when hiring for culture fit, leaders should consider culture as a defined set of values and behaviors, Noto says. “Think about ‘how do we do things around here,’ ” she says. Identify the behaviors that leaders, the CEO or the founders value, and what those behaviors that might look like in the different positions you’re hiring for.
When interviewing, specific behavioral questions can help you weigh whether the candidate will fit into the culture and also promote or build the culture, Noto says. Questions such as “Tell me about a time you had to persevere on a project” or “Talk about how you collaborate with others before you start a task” can provide an idea about whether an employee might fit in.
Finally, leaders and managers must reward and recognize those who positively affect an organization’s culture, Noto says. “And all leaders should be leading by example by exhibiting the behaviors and values they want to see from their employees.”
Buy-In Boosts Engagement
Once you’ve established a culture and assembled a team that understands and embraces your organization’s way of doing business, it’s time to harness that energy into engagement and productivity. Employees who embody your culture are ready to stay for the long haul, so it’s up to you to keep that dedication through engagement programs, which in turn can boost productivity.
It’s clear what happens when a company has an unclear or destructive culture, says Laura Handrick, HR staff writer at FitSmallBusiness.com, which provides information on how to build and run businesses. “One way to look at culture is in terms of opportunity cost,” she says. “In a company with a poor culture, where people feel demoralized, turnover is higher and you may spend more time than you want preventing claims and lawsuits.”
A good culture, on the other hand, can be measured in reduced employee turnover and lower HR recruitment costs, Handrick says. In addition, a company with a strong culture is likely to face fewer employee relations issues, less organizational noise, fewer claims of harassment, fewer unemployment claims and fewer lawsuits.
Handrick says some of the ways to transform cultural buy-in into engagement include:
- When employees understand what the organization is doing and why, they’ll see where their jobs fit into the bigger picture.
- The availability of senior leadership. Responsiveness is an important part of engagement; when employees feel like they can go to managers or company leaders with issues or ideas and get a fair hearing, they’ll be more willing to go the extra mile for the organization.
- Clear communication. No one likes to be left in the dark, and organizations that have a strong communication program will be able to keep employees up-to-date and informed about what’s going on with the organization.
The business case for culture is that talent is the differentiator and will make or break your company, Noto says. “Having a strong culture will help attract and retain the best people for the organization. If talent is the most important resource at an organization, then leadership must invest time and energy into managing the organizational culture.”
Culture Attracts Customers
When your company culture is strong and employees are engaged, it shows. A strong company culture is as much a part of your brand as a logo or tagline, and you can use it to engage customers just as much as you use it to engage employees, experts say. Employees can serve as culture ambassadors on social media and in customer-facing positions, or the company can use its culture as a marketing tool to tell a wider audience about itself.
“We trust those who are open with us and are more likely to buy from a company that promotes a culture of transparency and honesty, because we believe they will be honest with us,” says Andrew Selepak, a director of the graduate program in social media at the University of Florida. That trust and belief in the company transfers to the product or service you’re providing and fosters good feeling among consumers and potential customers.
“One of the best ways a company can build on their brand and online marketing is to give a behind-the-scenes look at what goes on day-to-day in the office or factory or restaurant,” Selepak says. That approach lets customers connect with the company beyond a product on a shelf, he says, and creates a public image and company culture of transparency which leads to trust.
Social media is a great way to share that side of your company, and photos or videos of employees working and exemplifying your culture will communicate what you stand for to your audience. Once you’ve identified the pillars of your company culture and what makes your company special, look for employees who embody those values and show them in their work. Photos or videos of them working or serving customers, blog posts about how they approach their role and other social media tactics can help communicate your culture to your audience and help foster the kind of trust that leads to a stronger bottom line.
Look for ways to get the word out about your company culture. Whether it reaches potential customers who share your values or gives current clients an aspirational idea of what you’re all about, it can add value to your transactions.
“Company culture” is too often seen as a fuzzy “extra” that doesn’t affect a company’s bottom line. But the business case for a strong company culture is clear: It creates a sense of belonging among employees, who then work harder toward a common goal, and attracts more customers who want to support companies they feel they have something in common with. Creating and maintaining a strong company culture can be the key to bigger business value, as long as it’s recognized and built strategically within the organization.