Your Company Culture: Why it is Important & How You Can IMPROVE IT

If you asked your employees right now what it’s like to work at your company each day, how would they respond? Do they feel like they work in an environment that supports their goals and ideas? Are they provided the appropriate resources to excel at their jobs? How would they rate their managers?

You may wonder why company culture is so important. Only three out of ten U.S. workers are involved in and enthusiastic about their workplace, according to Gallup’s 2013 State of the American Workplace report. That means that 70% of workers are not fully engaged in their workplace. This lack of commitment leads to decreased productivity and lower overall profits.

If this is a reality check for your company, take a moment now to get an honest look at your organizational culture. If you haven’t tried the new Culture Audit Tool, it’s a free member resource that allows you to examine the fine details of your culture and compare your answers to other companies. The survey contains 33 precise questions based on how employees assess your company. The areas include:

  • Mission, Purpose, and Success
  • Communication, Respect, and Trust
  • Team and Empowerment
  • Training, Development, and Support
  • Corporate Behavior and Ethics
  • Compensation and Benefits

This survey is 100% confidential and helps you get to the root of your company culture and provide a vision of which areas you need to focus your continuous improvement efforts.

So just how important is a healthy company culture? Research says it not only impacts your employees but also your bottom line. We’ve laid out four reasons to invest in your organization’s culture along with key ways to measure it.

Why invest in culture?

  1. It’s connected to financial performance—An 11-year study by John Kotter and James Heskett looked at the effects of culture in 207 companies from 22 industries. The results, published in their book Corporate Culture and Performance (Free Press, 2011), showed that companies that managed their corporate culture significantly outperformed similar companies that did not. The right corporate culture can be one of a business’s most critical assets.
  2. There’s a high ROI—Cultivating a great culture is a financially low-cost endeavor that can yield high economic returns. Best of all, it is an advantage that competitors cannot duplicate. (“How Intangible Corporate Culture Creates Tangible Profits”)
  3. Ignorance can lead to serious consequences—While culture may not seem like a top priority, a weak one will reveal itself when you try to implement a new strategy. You may find that your employees’ current thinking and behaviors are incompatible with new corporate initiatives. The conflict can make for an unsustainable strategy (“How Healthy is Your Culture?”).
  4. Managers have influence—At the organizational level, managers can help improve key outcomes by giving careful attention to how their actions and practices (such as values, beliefs, and norms) affect employee working conditions and their perceptions of these conditions. (“Causal Impact of Employee Work Perceptions on the Bottom Line of Organizations”)

Many of today’s best companies also have a great culture—Look at companies like Suttle-Straus, Vox Printing, and Hammer Packaging. These and other 2014 Best Workplace in the Americas Award winners understand that a healthy culture affects their bottom line. While not every organization can offer perks like an on-site fitness center, you can find ways to show employees they are valued.

How to measure it

  • Assess your culture using the Culture Audit Tooland benchmark your answers against those from other firms.Then if your leadership is committed to sharing the results and using them to take action, go a step further. Ask your employees to take the same assessment and compare the results. You’ll probably find gaps between management’s and employees’ perceptions.
  • Another way to measure your culture is from the outside in—how your customers feel about your organization. The Customer Feedback Management Programis a customized survey that reveals your customers’ opinions of your product quality and service. If your culture places a priority on customers and continuous improvement, then customers should like dealing with your company and report that your employees are responsive to their needs.

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