Why is Company Culture so Important?
“Company culture is the backbone of any successful organisation”. – Gary Vaynerchuk, CEO/Chairman of VaynerMedia
Your company has the potential to be so much more than just a place where people go to work and collect a wage. It can be a place where employees learn and develop, build meaningful relationships, and even achieve self-fulfillment.
However, none of the above can be considered achievable without significant and continued investment in your organisation’s culture.
In this article, we will explore the topic of corporate culture, discuss some of the advantages of maintaining a healthy one, and explore how you can get started on building a culture that is right for your business.
What is Company Culture?
An organisation’s culture consists of the shared values, attributes, behaviours, and characteristics its people hold and value. Essentially, it is the heart and soul of the company.
It is typically derived from and built upon a company’s mission statement which outlines a business’s raison d’etre and core principles.
Managerial expectations, work environment, approach to learning and development, leadership styles, and more can all have a significant role to play in forming an organisation’s overall culture.
Key Statistics About Company Culture
The significance of company culture continues to escalate year after year. Companies can no longer ignore the impact it can have on the likes of employee retention, brand reputation, and recruitment.
To prove its merit, we have compiled some key statistics about company culture.
- 77% of people consider a company’s culture before applying for a role with them
- 86% of people would not apply for or continue to work for a company with a poor reputation among former employees
- In Ireland, culture is the third most important consideration for third-level graduates, behind only salary prospects and job security
- Creating and maintaining a culture that can attract and retain top talent can help companies achieve a 33% increase in revenue
- Having a satisfied and highly engaged workforce can lead to as much as a 202% increase in performance
- 44% of Irish businesses are placing more emphasis on improving their organisational culture
- According to Deloitte, 94% of business executives believe that a strong corporate culture is imperative to an organisation’s success
Benefits of a Good Company Culture
Companies that invest thought and resources into developing and sustaining a good culture tend to reap the rewards. If treated as an integral part of the business strategy, culture will behave as such and return dividends.
With that in mind, here are some of the greatest advantages of a positive and healthy workplace culture.
Improved Employee Retention
Arguably the most significant benefit of a brilliant corporate culture is the fact it keeps people around.
Excellent pay rates and career prospects are just part of the puzzle. The lack of a proper, clearly defined culture will leave your business at risk of having its talent poached by companies that do have one.
The monumental cost involved in employee turnover alone should be a compelling selling point for investing in culture. According to Built In, losing an employee can cost an organisation up to two times the employee’s salary.
Cultures that promote a sense of community, encourage recognition, and make people feel a connection to the company and its values, inspire people to stay.
The importance of cultural fit has continued to grow in recent years, acting as a major selling point for companies looking to expand their workforce.
When it comes to recruitment, cultural fit works both ways.
Prospective candidates will be more enticed to join an employer with an attractive company culture and values they can get behind. Similarly, the hiring company will feel more confident in hiring someone that they believe can seamlessly integrate into and positively influence their culture.
Having a well-established culture and communicating it from the very beginning of the recruitment process can also lead to a smoother onboarding for the successful candidate.
Any new recruits will join with a strong prior knowledge of your organisation’s ethos, helping them to acclimatise more quickly.
Greater Productivity and Innovation
The right corporate culture can leave your staff feeling motivated and energised.
Employees are empowered to give their best effort when they feel comfortable and appreciated at work.
Additionally, when employees feel like they are a part of something meaningful and that their contributions are valued, they are more likely to become invested in both their role and the company they work for.
There are also more opportunities for innovation to occur when your team is highly engaged and driven. As a result of increased employee collaboration, the workplace will become a more creative and innovative setting.
It is perfectly acceptable to shout about your company’s culture on social media, especially if your company has worked hard on developing it and consistently backs it up with its actions.
Promoting your values and people can be a highly effective way to boost engagement and strengthen your brand’s public image.
In companies with really great cultures employees become brand ambassadors organically and sing the praises of their employer both in person and on social media.
This sort of advocacy is extremely beneficial, particularly from a recruitment standpoint.
49 million people search for jobs on LinkedIn each week so having your brand discussed on the platform in a positive light can be a huge advantage in the race for talent.
Better Employee Wellbeing and Engagement
Your people are your biggest investment. Thus, it makes sense to prioritise their wellbeing.
The right workplace environment will actively encourage work-life balance, protect employees from stress, and promote a healthy and active lifestyle.
A recent survey conducted in Ireland revealed that 93% of people would prefer to work for an employer that supports a better work-life fit.
Culture can also be an enormous determinant of how engaged a company’s workforce is. Engaged employees feel a greater sense of unity and are more willing to take part in team-building activities and provide feedback.
5 Brilliant Tips for Building the Right Company Culture
1. Define It
The first step to developing a positive culture is to be clear about what you want it to be. Without proper planning at this stage, your vision can become distorted over time and your culture inconsistent.
Use your company’s core principles and objectives as a foundation for mapping out your ideal workplace culture. This will help you to then formulate strategies that will reinforce and expand on it.
For example, if one of your company values is to continuously innovate and you want to instill a culture of professional development, you may look at creating an extensive learning and development programme, and targeting candidates with a passion for upskilling in your hiring practices.
Having a clearly defined culture also makes it easier for employees to become invested.
It is essential for staff to fully comprehend a corporation’s values and goals so that they can determine if they are compatible with their own.
Employees will be much more willing to contribute to a company’s mission if they feel positive about its principles.
2. Facilitate Open and Honest Feedback
Your staff are the people that are really going to drive your culture. Therefore, they should be heavily involved in shaping and evolving it.
By facilitating honest and open feedback through the likes of anonymous feedback surveys, focus groups, and pulse surveys, and then acting upon that feedback, you can establish a culture of trust within your organisation.
Employees are 4.6 times more likely to feel empowered to perform at their highest level at work when you listen to them.
3. Prioritise Employee Wellbeing
All great company cultures put the health and wellbeing of their people first.
Employees who are given the right resources to look after their physical and mental health will be much happier and much more productive.
Consider establishing a comprehensive health & wellbeing programme to help structure and promote a culture of wellness.
Here is a snapshot of what company health & wellbeing programmes often entail:
- Healthcare plans for employees
- Employee assistance programmes
- Holistic benefits that support staff wellbeing
- Strategies to promote and improve work-life balance
4. Focus on Fostering Relationships
Building relationships at work is essential to fostering a great company culture.
On a busy working day, employees may have very limited opportunities to interact with one another. Without this interaction, your culture can become stagnant.
Hence, it is imperative to create opportunities for social interaction, particularly ones outside of the workplace.
Team-building activities build trust, improve morale, enhance communication, inspire collaboration, and more.
5. Lead by Example
Mapping out your ideal culture is all well and good, but for it to truly permeate throughout the organisation, employees need to see it in action.
This is where your organisation’s leaders need to step up and lead by example. Leaders must publicly display their commitment to the company’s basic values.
For instance, if you wish to embed a culture of sharing client wins and good news stories on your company’s intranet, your senior management team needs to be at the forefront of this, posting regular updates.
If your senior management team is seen to be doing something, it will eventually assimilate right down through the organisation.
We hope that you enjoyed this article on the importance of company culture, check out our news section for more recruitment insights.
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