Corporate Culture 101: Building a Strong Company Culture

February 2, 2023
Corporate Culture 101: Building a Strong Company Culture

Hey there! You might be thinking that corporate culture is just a fuzzy, hard-to-define idea that doesn't really have any impact on your business. But actually, a strong company culture can make all the difference in your success. Studies have shown that when a company has a positive culture that's supported from the top, it can lead to huge increases in employee engagement. 

In fact, Gallup found that engagement can go from under 20% to over 70% in "high-development cultures." And it's not just about happy employees, a strong culture can also affect your bottom line. For example, a survey by Jobvite found that 32% of employees who quit within the first 90 days did so because they didn't fit with the company culture. Even more impressive, McKinsey & Company found that organizations with top-rated cultures had returns to shareholders 200% higher than those with weak cultures. 

Sure, having some cool perks like snacks and a relaxed dress code can make your office feel like a more enjoyable place to be, but that's just the tip of the iceberg when it comes to corporate culture. It's about taking your company values - like integrity, innovation, and respect - and making them a real part of how your workplace operates.

As workplace strategist and author Erica Keswin says, it's not enough to just talk about these values, you've got to put in the work to turn them into tangible practices that have a real impact on your employees. In other words, it's about making sure your culture is more than just lip service.

Defining Company Culture

There is a lot of talk about what corporate culture actually means, and researchers at MIT found lots of different definitions in academic literature. But when they looked at over 560 companies' statements about their culture, they found that there was a common thread: a set of norms and values that are widely shared and deeply held throughout the organization.

And it's not just about these values being shared, they're also all-encompassing and long-lasting. A Harvard Business Review article called "The Leader's Guide to Corporate Culture" explains that your company culture is a persistent pattern of behaviors, attitudes, and shared values that pervade every level of your organization. In other words, it's not just a passing trend, it's a core part of who you are as a company.

company culture

Unlocking the 4 Key Forms of Company Culture

Experts say there are four main types of corporate culture out there. The Project Management Institute, which is a big deal in the world of project management, breaks it down like this:

  • Clan: Think of it like a second family at work, with a focus on teamwork and mentorship.
  • Adhocracy: This type of culture is all about taking risks, being creative, and fostering innovation.
  • Hierarchy: This is a company that values structure, stability, and following the rules.
  • Market: The focus here is on getting results, serving customers and suppliers, and being successful in the market.

Now, a company might fit one of these descriptions perfectly, but according to Ashley Cox, the founder and CEO of a human resources consulting firm called SproutHR, it's not as important to label your company culture as it is to define what it is and how everyone can be a part of it. So don't get too hung up on matching one of these archetypes exactly.

Key Components

Whether you like it or not, every company has its own culture. Some companies, like Zappos, are known for their happy employees and quirky culture. And then you have companies like Apple, with their innovative and demanding culture where secrecy is key.

It's important to remember that culture is not something that just happens by chance. The best company cultures are ones that are intentionally designed based on the values of the company and that help support their goals. As workplace strategist Erica Keswin says, "There's going to be a culture whether you like it or not, so make it one that supports your business and your people and gives you the best shot at success."

Now, company culture can be complex and can look different from company to company. But generally, it centers around these four pillars:

  1. Vision, mission, and core values

It's important to have a solid foundation for your company culture, and that starts with your vision, mission statement, and core values. Ashley Cox explains that vision is what motivates and inspires the team, the mission is how the team will work together to achieve that vision, and core values are the principles that guide the team in achieving that goal.

According to a study by MIT researchers, the top five values found in more than 560 companies were integrity, collaboration, customer, respect, and innovation. However, having too many values can be overwhelming and make them hard to remember and implement. Erica Keswin, suggests focusing on three to six values that define the essence of your organization, as they not only describe what you do, but also how you get things done.

  1. Language

Culture is everywhere in a company, it affects all aspects of the workforce, including the way coworkers interact with each other. This is why it's important for the executive leadership team, along with HR, to get together and come up with a common language that aligns with the culture they want to create. This can include catchphrases or acronyms that bring everyone together. To make this happen, they should focus on questions like:

  • How do you communicate about the business, clients and customers, and each other?
  • What is considered appropriate and acceptable behavior?
  • What language brings everyone together and creates a sense of community?

The idea is to create some general guidelines for language that everyone can follow. Then, company leaders and HR can work with the entire team to create the actual language together.

Rituals can also bring coworkers closer and build a sense of community based on your company's values. They can range from small gestures to big programs, like the way you start meetings, develop the workforce, or build community. For example, Udemy values learning and has their monthly "Drop Everything and Learn" (DEAL) hour where employees take an online class for an hour. LinkedIn prioritizes talent and provides its employees with a monthly "Investment Day" (InDay) where they can focus on themselves, the company, and the world at large. And Chipotle, the fast food chain, values connecting as individuals and starts each day with a team meal before stores open.

In conclusion, leaders should think of ways to put the company culture into practice and bring it to life in the organization.

building company culture

3. Decision making

Decision making processes play a big role in shaping a company's culture, according to Ashley Cox. Some companies are all about top-down decision making, while others have a more collaborative approach where employees have more autonomy and make decisions as a team. "Different cultures work for different types of businesses and leadership styles," Ashley Cox explained. "It's all about finding the right fit.

4. People

When it comes to culture in an organization, employees play a big part. That's why it's crucial for companies to choose the right people to join their team. During the hiring process, companies should not just look at a candidate's skills, but also their cultural fit - how they'll fit in with the company's unique culture.

Stacy Schutte and Ashley Nemeroff, co-founders of executive search firm Moxie Search Group, suggest asking questions like, "Do they resonate with our culture? Are the things that matter to us important to them?" to determine cultural fit.

During interviews, you can learn more about a candidate by asking situation-based or behavioral questions like, "Tell me about a time when you had to handle a problem," or "Can you share an example of how you dealt with feedback?"

Ashley adds that the goal is to create a relationship with the candidate and make them feel comfortable opening up, so you can get to know them better, what they stand for, and if they're the right fit for the company.

While you're hiring for cultural fit, it's important to avoid hiring people just like you, says Schutte and Nemeroff. Don't define 'fit' as everyone having the same background or fashion sense.

Deren Tavgac, COO of Cube, a data analytics software company, believes in diversity when hiring. He says, "I never hire people who are exactly like me in skills and personality. Culture is more about how we succeed as a group - are we aligned on the end goal?

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