Every company has a culture, whether they’re a business, a sports team or a school, regardless of whether they can actually define it.
Using the word “culture” can be an ambiguous term for a company, but it’s used by nearly any type of organization you can think of. So, what is the definition of organizational culture? It can vary based on who you ask, but one way to explain it is that it’s the set of shared beliefs and values within an organization that dictates how the individuals behave. Organizations inevitably change and evolve over time, though, which means that its company culture may also change and become difficult to truly define.
Below, we’ll go over the factors that influence organizational culture the most and why building and maintaining a positive culture is so important.
How decision makers influence organizational culture
Whether you’re talking about the organization as a whole or one specific team, culture truly does start at the top. Corporate and team leadership are generally the ones who develop a company’s core values into clearly written and well-established guidelines. They’re also the ones in charge of instilling and reinforcing those values amongst their employees. Ultimately, these core values shape the behaviors of employees and contextualize the actions and decisions made by leadership.
With so much influence, however, leaders and decision makers need to be especially mindful of their own conduct and how it impacts organizational culture. In a sense, leaders are role models whose actions will be observed and emulated by those around them. The decisions leaders make also have a direct influence on their organizational culture. It’s good practice for leaders to approach their decisions with that mindset. Questions leaders should ask themselves when making important decisions include:
- What kind of culture does the team or organization currently have?
- Does this decision fit within established core values and beliefs?
- Does this decision fall in line with all written guidelines?
- How will this decision impact our future goals related to team and organizational culture?
How will this decision impact team morale?
Factors that influence organizational culture
A wide range of factors can influence a company’s culture, but some areas require particular attention. As much as a fun happy hour or team activity can help boost morale, these likely won’t make or break the overall outlook employees have of their organization. Below is a list of some of the most common things that have a large impact:
Pay and benefits. There’s no getting around it: nobody is going to be happy if they believe (or know for a fact) they’re underpaid. Pay may not be everything to everyone, but it is a top priority for most. Organizations risk losing their best employees if they don’t feel valued, especially in tough economic times.
Similarly, benefits have become an increasingly make-or-break factor for employees, especially for those with families. People value the security of having benefits like strong health, vision and dental plans, or the ability to take a vacation if they need it. Having an inclusive and equitable benefits plan attracts top talent and great culture fits and is also essential to keep them.
Recruitment and selection. If a company has a strong culture it wants to maintain, they need to be highly selective of who they bring into the fold. They will need to ensure that the person they select is a strong fit in terms of their professionalism, skills, attitude and values, among other traits.
Unintentionally bringing in new hires that are a bad culture fit can have a negative impact on the team and overall organizational culture. Further, continued negative behavior can greatly hamper the performance of teams, so dealing with an employee that turns out to be a bad culture fit is also important to the overall health of the team and culture.
Workload, goals and objectives. Nearly everyone wants to achieve success in their career, but not at the expense of work-life balance. Generally speaking, people want to be challenged in their work without feeling overwhelmed. Setting unrealistic goals or overloading employees with different tasks can have a significantly negative impact on how people and teams view themselves or their role.
At the same time, companies risk employees becoming bored or unmotivated if there isn’t enough to do, which can cause them to feel like they’re wasting their time. It can be a fine line to walk, and how well leadership does it can greatly influence their organizational culture.
Development and advancement opportunities. Taking the time to develop employees’ skills and knowledge is mutually beneficial. They gain the tools and opportunities to grow and advance their careers, and companies get better performance and output from them in return. Offering different opportunities for professional development not only instills a sense of achievement, but it’s also a great way for leaders and employees to grow their professional relationships.
With that said, employees will want to be rewarded for better output and performance. How leaders handle this type of situation can make an enormous impact on organizational culture. Does your organization reward high performers who are good culture fits? Do those individuals feel rewarded? Employees notice how others are treated and talk to one another. If they see one person struggling to advance their careers, they might develop doubts of their own.
Communication and consistency. When and how leaders communicate with employees is essential for maintaining positive organizational culture. Creating a culture where people are afraid or intimidated to ask for what they need can quickly deteriorate team morale. Similarly, failure to communicate important information can create a poor work experience, increase frustration and lead to critical mistakes.
On the other hand, proper communication can foster an environment where people feel valued and empowered. Being clear, consistent and respectful when communicating information and expectations gives people the best chance to be successful in their role. Most importantly, it makes them feel like they’re genuinely part of a team.
Why is strong organizational culture important?
Put simply, leadership wants employees to be happy because it makes them more productive. What makes employees happy? The sense that they’re respected for who they are and what they do by their peers, their leadership and by the company as a whole.
“Respect” in this instance doesn’t just mean being polite. At the most fundamental level, companies show their respect for employees when they remember that employees are human beings and not machines. People need to feel safe and secure. They need to feel like their needs are being met, and they’re being given the opportunity to succeed in their careers.
These things don’t guarantee a strong organizational culture, but companies can’t achieve that kind of culture without them. At Shamrock specifically, we’ve found that investing in employees and fostering a strong culture is a mutually beneficial endeavor. Here’s why:
- Culture helps you keep your best people. People want to feel appreciated for their work and want to get along with the people they work with. A company that hires good culture fits, provides opportunities for development and rewards high performers makes it hard for employees to leave (because companies that do the same can, unfortunately, be very hard to find).
- Culture impacts performance and well-being. Most of us have worked a job that we didn’t like for one reason or another. For many, these experiences led directly to things like poor mental health and lack of motivation. To get the most from them, employees need to feel motivated, supported and happy. Companies do that by creating a positive work environment, which comes from things like:
- Reinforcing good behaviors.
- Offering flexibility when needed
- Setting reasonable expectations
- Healthy work-life balance
- And more
- Culture helps recruiting. Remember when we said how difficult it is to find places with good organizational culture? The flip side of that is companies known for strong cultures instantly stand out and become very attractive for prospective employees. It becomes easier to bring in top talent and to onboard and ingratiate that talent into your organization because of clear guidelines and expectations.
- Culture is a reflection of your values as a company. You can tell a lot about a company based on its organizational culture, both good and bad. Primarily, it tells customers and prospective employees whether the company is honest and accountable. If a company can’t act according to its stated values, and doesn’t care about the success and well-being of every employee, why should somebody trust them?
Creating a strong culture takes a ton of work, and it won’t manifest without collective buy-in from both employees and leadership. We at Shamrock are an example of the benefits that come with prioritizing organizational culture. As a result of these efforts, we’ve been fortunate to earn recognition and see consistent growth within the company for several years.
Explore the Shamrock website to learn more about us, our family of brands and our open positions!