What is company culture and why is it important?

Date Published : Sep-23-2021

Written By : Kim Brown

“Company culture” sounds like it belongs to that list of corporate buzzwords many of us detest. But successful leaders and happy employees know that company culture is more than a concept; it can be the factor that differentiates a good workplace from a great one.

Perhaps the reason why some of us scoff or roll our eyes when we hear that term is because we don’t have a true understanding of the role culture plays in our offices. Or maybe we haven’t yet found a place that has a helpful company culture. This article will explore the value of company culture, and offer ideas about how your company can build a positive and productive company culture.    


What is culture?

Culture is the tacit social order of an organization, writes Harvard Business Review. It shapes attitudes and behaviours in wide-ranging and durable ways. While strategy is typically determined by managers and CEOs, culture blends the ideas of top leaders with the knowledge and experiences of the employees who keep the company moving forward. It comes from all members who play a role in shaping the workplace.

Culture is:

Implicit – despite it being invisible, people are surprisingly hardwired to recognize and respond to culture.

Pervasive – culture impacts collective behaviours, physical work environments, team rituals, corporate resources, processes, and more.

Shared – employees have learned a set of unwritten rules that are directly influenced by the company’s culture.

Enduring – people are drawn to organizations with characteristics that mirror their own. Companies are more likely to select candidates who are “a good fit.” The culture eventually becomes a self-reinforcing social pattern.

Cultural norms give people and companies cues as to what is acceptable, encouraged, and unacceptable. In some workplaces, there may be an expectation for employees to work long hours without receiving overtime pay. In other companies, employees may be discouraged from working late. The corporate culture informs people of what they should be doing in order to succeed.  

When properly aligned with clear and established values, goals, and aspirations, culture can elevate a company’s potential. While employees don’t all have to think and work exactly the same, company culture ensures everyone is on the same page. Culture can also evolve a company’s flexibility in response to changing opportunities and demands (something we all need today).

Why does company culture matter?

Company culture and leadership are inextricably linked. From recruiting top talent to ensuring employees are still excited to come to work three or even five years after joining your team, company culture is a key pillar of a happy and prosperous business. It’s as simple as this – when people like a company’s culture, they are much more likely to be loyal, honest and engaged. As a result, the business is more productive, engaged and successful.

Conversely, if staff don’t like the environment they work in, either because they feel underappreciated, stuck in their current role, their work doesn’t matter, or that their work environment is too stringent, your best people won’t stick around for long.


The disconnect

When the turnover rate is high, or performance is low, leaders may need to examine the culture, as opposed to their strategy, to pinpoint the issue.    

94% of executives and 88% of employees believe a distinct workplace culture is important to business success. However, the same report found that executives focused more heavily on strategy than values or beliefs when thinking about what has contributed to the company’s success. Conversely, employees thought that strategy and culture held about the same level of relevance when considering the specific things that contributed to the company’s success.

Here’s the problem that ends up trivializing the concept of company culture; executives and managers may make the mistake of simply talking about their culture instead of actually embedding their beliefs into their operations. Many either forget about it entirely, or relegate it to HR as a background issue.


A company’s culture goes beyond ping pong tables and casual Fridays

Only 12% of companies surveyed by Deloitte believed they understood their company culture. Organizations that take a proactive approach to create a culture defined by meaningful work and employee engagement almost always outperform their peers. However, culture is much more than hosting a pizza lunch or installing a novel item in the office. Small acts of gratitude help, but they do not create a culture on their own.

Culture is about values, beliefs, and behaviours that shape how actual work gets done. If employees work well together, then a pizza lunch offers a good opportunity for some socialization. But if they barely talk to one another, or don’t really like each other, the lunch ends up being another tedious event that can’t end soon enough.


Culture styles

Company culture is about as unique as the company itself. Each workplace will have to find what works for them. Below is a list of different styles that can be combined and customized to create a positive space for staff.   

Caring focuses on relationships and mutual trust. A caring work environment is warm, collaborative, and welcoming. Leaders exemplify sincerity, teamwork, and positive relationships.

Purpose is met through idealism and altruism. A purposeful work environment is compassionate, and staff try to make changes that will benefit the long-term future of the world. Leaders value shared ideals and believe in a greater cause.

Learning is characterized by exploration, expansiveness, and creativity. Creative organizations are inventive and open-minded. Leaders are innovative, knowledgeable and adventurous.

Enjoyment is expressed through fun and excitement. These workplaces are led by people who value spontaneity and a sense of humour.

Results focuses on achievements and winning. A business that values results hires employees who are outcome-oriented and like to perform at a top level. Leaders emphasize goal accomplishment.

Authority is characterized by strength, decisiveness, and boldness. These companies are competitive and like control. Leaders value confidence and dominance.

Safety is achieved through planning, caution, and preparedness. Work environments that take on a safety culture value predictability and care. Leaders are realistic and plan ahead.

Order requires respect, structure, and shared norms. Work environments that have an order culture are methodical, and staff tend to play by the rules. Leaders emphasize shared procedures and reliable customs.


Evolving a company’s work culture

Employees who say their organization has a clearly articulated and lived culture also say they are happy at work and feel valued by their company.

If your company doesn’t have a strong culture, there are steps the organization can take to change that. But, transforming a company’s culture will require patience, time and cooperation from everyone.


Articulate your goal to create a positive company culture

Much like defining a new strategy, creating a new company culture should begin with an analysis of the current one. Managers and executives must understand what outcomes the culture style they seek will produce, and how that culture aligns with current and anticipated business goals and challenges.



It’s such a basic thing, but so easily forgotten. In addition to communicating your desires for the company, be sure to listen to what your employees want to see as well.


Select or train leaders who embody your target culture

Leaders serve as important catalysts for change by encouraging it at all levels. Plus, it takes more than one person to make such a significant change in a company.


Provide meaning 

Meaning and purpose are more important than ever. Most employees do crave meaning and purpose in their work. Start by creating a mission statement and core values for the company if you don’t already have them. Give your team specific examples of how their roles positively impact the company and its clients.


Use organizational conversations about culture to underscore the need for change

To shift shared norms, beliefs, and expectations within an organization, encourage colleagues to talk with leaders (and each other). As employees start to hear more about new business outcomes (innovation or client satisfaction as opposed to quarterly earnings) from leaders, they will begin to behave differently themselves, creating a positive ripple effect. Various kinds of organizational conversations, including listening tours, and structured group discussions, and platforms for authentic feedback, can support change.


Reinforce desired change through organizational design

When a company has the tools, resources, systems, and processes in place to support a change in company culture, it becomes much easier to make and maintain any necessary changes. For example, the degree of centralization, or the number of hierarchical levels in the company, can be adjusted to reinforce behaviours inherent to the aspirational culture. Similarly, management might introduce technology to help employees be more self-sufficient or collaborative. This also shows that the leaders trust the staff to get their work done.