When it comes to the business world, there is a common misconception that everything revolves around business strategies and profit. But there is an intangible, yet incredibly powerful aspect that can make or break an organization: the corporate culture. It’s the unseen force that shapes the values, beliefs, and behaviors within the company. While it might not appear on balance sheets or in profit margins, corporate culture profoundly influences the job satisfaction, productivity, and longevity of employees.
Before we dive deeper and explore why it’s so important and how companies can foster a positive company culture to improve employee satisfaction, let's start with the essentials.
What is corporate culture?
The corporate culture is a collection of core corporate values, attitudes, and behaviors that define the identity of the organization. When defining company culture it’s very important to understand that it’s not only a set of written values or slogans. Corporate culture is something that permeates every aspect of the workplace, shaping the experience and perceptions of employees at all levels.
Let’s translate this into a real-life example. On the first day of work, the HR manager pulls out a presentation slide and politely explains to you what the corporate values are. These values may sound something like “honesty”, “transparency”, “loyalty”, or “support”. They seem great on paper and you are definitely excited to join such a workplace.
However, as you start talking to the team you notice they are not as supportive, open, and ready to help as you thought. At this point, you forget all about the nice presentation and corporate values you’ve been told about. You can see the “real” corporate culture now. It doesn’t seem like the perfect place to work anymore, right?
Agreed, this corporate culture example might be a bit exaggerated, and we really hope such companies become extinct. But hopefully, the example was good enough to emphasize the importance of everyday culture that is shared within the organization. We go back to the point that written company values are not equal to the corporate culture. They might serve as the blueprint for the company and culture, but they alone don't encapsulate it entirely. While articulated values provide a foundation, company culture is also shaped by daily practices, leadership actions, and employee experiences. It's the lived expression of these values that truly defines everything.
Why is corporate culture important for employee satisfaction?
Just like how certain people encourage us to do our best, certain companies have an atmosphere that motivates us to go the extra mile. On the flip side, there are companies where we feel less inspired to put in the effort. That's the power of organizational culture in action - it shapes how we behave at work and even how we feel as a result.
In a good work environment, you feel valued and heard. People in such workplaces are eager to do their best and stick around for a long time. A recent employee survey found that 65% of millennials and 52% of Gen X prioritize a great organizational culture over salary when measuring their job satisfaction.
On the other hand, in a bad work environment, you might feel ignored and worn out. This leads to lower employee satisfaction and productivity. According to McKinsey, over 60% of negative workplace issues stem from toxic behavior, showing how much of a toll bad work environments can take on employee happiness and well-being.
It’s a great step forward that nowadays people pay so much attention to corporate culture, because, honestly, it might be the most powerful way to improve your business. According to the Deloitte survey, 94% of executives and 88% of employees believe a distinct culture is important to business success and workplace satisfaction. When nurtured the right way, the corporate culture might be even more important than organizational rules and regulations.
How to build a positive corporate culture to increase employee satisfaction
Granted, it’s not easy to build a positive company culture. In fact, more than 66% of managers agree that maintaining culture is one of their biggest challenges. This comes as no surprise since many organizations struggle with a gap between their existing and their desired culture - one that can support and advance the company’s goals and strategies.
In a new culture-building model, everyone is responsible for cultivating the desired culture. Considering this, we’ve collected some key tips for building corporate culture.
Define your core corporate values
Identify the values that are central to your organization's identity and mission. These values should guide decision-making, behavior, and interactions within the company.
Consider corporate culture leadership
Leadership must embody the values and behaviors they wish to see in the organization. Consistency between words and actions is crucial in building trust and credibility.
Communicate transparently
Establish clear and open channels of communication where employees feel comfortable sharing feedback, ideas, and concerns. Transparency fosters trust and alignment within the organization.
Prioritize employee well-being
Invest in programs and initiatives that support employee well-being, such as flexible work arrangements, wellness programs, and mental health resources. Show employees that their health and happiness are valued.
Foster collaboration and inclusivity
Promote a culture of collaboration where diverse perspectives are welcomed and respected. Create opportunities for cross-functional teamwork and inclusion initiatives.
Recognize and reward success
Acknowledge and celebrate achievements through formal and informal recognition programs. Reward employees for their contributions to the organization's goals and values.
Encourage continuous learning
Provide opportunities for growth and development through training programs, mentorship, and skill-building initiatives. Foster a culture that values lifelong learning and personal development.
Embrace innovation and adaptability
Encourage experimentation and risk-taking to drive innovation and adaptability. Create an environment where employees feel empowered to challenge the status quo and propose new ideas.
Assess and adjust
Regularly evaluate the effectiveness of your culture-building efforts through employee satisfaction surveys, feedback sessions, and other tools to measure employee satisfaction. Be willing to adapt and evolve based on the feedback received.
Lead with empathy and compassion
Show empathy and compassion toward employees' needs, challenges, and aspirations. Create a supportive environment where employees feel valued, heard, and cared for.
Promote work-life balance
Encourage work-life balance by setting realistic expectations, offering flexible work arrangements, and respecting boundaries. Help employees prioritize their well-being outside of work.
Cultivate a sense of purpose
Connect employees to the organization's mission and vision, helping them understand how their work contributes to the larger goals of the company. Foster a sense of purpose and meaning in their roles.
Stay consistent and committed
Consistently reinforce the desired culture through policies, practices, and everyday interactions. Building a strong corporate culture requires ongoing commitment and effort from everyone in the organization.
How can you evaluate your corporate culture?
For sure, business is not just rainbows with unicorns, it requires numbers! We’ve included some ideas on how you can assess your corporate culture and gain valuable insights for enhancing employee satisfaction.
Employee surveys
Conduct regular employee engagement surveys to measure employees' commitment, motivation, and satisfaction levels. Use quantitative metrics such as engagement scores, Net Promoter Scores (NPS), and responses to specific cultural-related questions to assess the overall health of the corporate culture.
Measuring employee satisfaction is a great way to understand how employees relate to different aspects of the workplace, including leadership, communication, collaboration, and work-life balance.
Employee referral rates
Monitor employee referral rates to gauge employee satisfaction and advocacy. High referral rates indicate a positive culture where employees are motivated to recommend the organization to others, while low rates may signal cultural issues. The willingness to recommend the workplace to others is among the most telling job satisfaction metrics.
Employee turnover and performance metrics
Track employee turnover rates over time to understand attrition patterns and identify potential cultural issues. High turnover rates may indicate dissatisfaction or disengagement among employees, signaling underlying cultural challenges.
Similarly, performance metrics such as productivity and quality of work can show you where employees are struggling and if there is a deeper reason related to corporate culture.
Training and development metrics
Monitor employee referral rates to gauge employee satisfaction and advocacy. High referral rates indicate a positive culture where employees are motivated to recommend the organization to others, while low rates may signal cultural issues. The willingness to recommend the workplace to others is among the most telling job satisfaction metrics.
Organizational culture leadership
Evaluate leadership effectiveness through 360-degree feedback assessments or leadership performance reviews. Quantify ratings and feedback on leadership behaviors, communication styles, and cultural influence to gauge leadership impact on workplace culture.
Diversity, inclusion, and cultural alignment
Track diversity and inclusion metrics such as demographic representation, gender diversity, ethnic diversity, and inclusion index scores. Compare these metrics to industry benchmarks and set targets for improvement to foster a more inclusive culture.
Conduct cultural alignment assessments to measure the degree of alignment between stated values and observed behaviors within the organization. Use quantitative scales or scoring systems to assess alignment and identify areas of inconsistency.
Final thoughts
A strong corporate culture plays a key role in creating a supportive and fulfilling work environment where employees can thrive. Because it has such far-reaching consequences, you can think of corporate culture as the foundation for everything else, including employee happiness, productivity, and your overall business success.
In conclusion, if you want to create a work environment that supports employee satisfaction, it’s important to focus on building corporate culture. Together with your corporate values and day-to-day actions to enforce these values, culture is the number one differentiator.
