Every business needs great organizational culture to achieve success.
Because companies with a healthy culture are 1.5 times more likely to see revenue growth than those who don’t see the importance of organizational culture.
However, company leaders don’t seem to agree on a definition for workplace culture.
Don’t worry—this article will explain what organizational culture is, show successful examples, and uncover the characteristics of a strong internal culture.
What Is Organizational Culture and Why Is It Important?
Organizational culture is defined as the collection of company values, expectations, and behaviors that affect the way people interact with clients, stakeholders, and each other.
Company culture affects all aspects of a business, from employee benefits to dress code.
When cultural values align with your employees, they’ll feel more comfortable and supported. This also affects your bottom line.
Corporate culture is very important because it offers a key advantage in attracting and retaining talent. 77% of new hires take an organization’s culture into consideration when applying for a new job.
Almost 50% of employees would leave their current job for a different work environment, where they would be able to find their desired culture.
Having said that, culture shouldn’t be confused with organizational goals or mission statements.
If it’s confusing to envision how a company culture should look, don’t worry. In the next section, you’ll see four good examples of organizational culture.
4 Examples of Successful Company Culture
A strong culture is the secret to creating a good onboarding experience and retaining new hires. However, since it’s tricky to define, it might take a lot of time and effort to get it right.
If you’re struggling with creating a memorable company culture, then take inspiration from these companies.
Everyone knows Microsoft, the world-class technology company admired by many competitors. The secret is their amazing culture and putting emphasis on creating a great experience for their employees.
Satya Nadella, Microsoft’s CEO since 2014, refined the company culture and transformed it from a competitive work environment into one that favors continuous learning. Now, instead of employees trying to prove themselves, they are encouraged to improve.
One other good example is Salesforce, another technology company, run by Marc Benioff. Salesforce’s founder and CEO makes company culture their priority—and has experienced growth as a result over the past two decades.
New employees at Salesforce spend their first day volunteering and they receive 56 hours of paid time to volunteer. That sounds like a great idea that increases morale and productivity.
Adobe is another work environment that builds a reputation on core values such as creativity and quality in everything they do. They create a good organizational culture by offering highly competitive benefits, like paid parental leave or retirement benefits.
The company also focuses on diversity, inclusion, and creativity in the workplace. Adobe believes that people are more innovative when they feel included and appreciated—and they always encourage employees to share their thoughts and feelings.
Our last example is the well-known Google, where employees are talented, hardworking—and simply enthusiastic about their work. Google offers many perks and bonuses, such as free meals, cash bonuses, employee recognition programs, and pet-friendly spaces.
There are many ways you can engage an employee and integrate new hires into your current culture.
What’s important is to not get discouraged by the strong culture of such big corporations.
By knowing the characteristics of an amazing organizational culture, you can also create one that your team members will love.
7 Characteristics of Strong Organizational Culture
What makes organizational culture strong?
There are many characteristics that define corporate culture, but it’s often complex and hard to define.
This makes it harder to put into action, too.
To make it easier, take a look at the seven characteristics of strong organizational culture:
Author’s Tip: Strong company culture starts with a strong employee connection. Honesty, humility, celebration, and appreciation are needed for a successful employee experience.
It might seem overwhelming at first, but building a culture of success is mandatory if you want a competitive advantage in today’s market.
Take a deeper look into what these characteristics are.
#1 Have a unified purpose
With the rise in technology and resulting higher demands, the modern-day workforce feels overworked and in need of an inspirational driver.
A united purpose is what motivates employees and creates a productive environment. People want to be part of something bigger than themselves, not work on meaningless projects.
Employees need to have a clear sense of purpose, understand their goals, and work to achieve these objectives with the proper motivation.
#2 Enables efficient communication
Effective communication should consist of these 3 core values:
Companies with efficient communication have employees that get more work done clearly and concisely. This also ensures that every worker is on the same page.
What’s important to remember is that not everyone communicates in the same way. You should accommodate all different styles and personalities—and not accidentally silence someone.
Check-ins also help employees remain engaged. A recent Workhuman study discovered that workplace cultures with regular check-ins are likely to have employees that trust their managers and have a sense of belonging.
#3 Embraces diversity
Company culture should embrace diversity in the workplace, not only for creating a good company image to attract talent, but also for fostering teamwork and collaboration.
With remote working now a popular practice, you can hire new employees from different cultures. A good workplace culture means a proper approach to cultural diversity.
You should also teach employees how to be tolerant of each other without making assumptions, judging, stereotyping, or discriminating. This can potentially lead to a better organization and better decision-making.
#4 Shows recognition and appreciation
Recognizing good work helps boost morale and is a good initiative for employee engagement.
Having a reward system in place can make employees feel valued. You’d be surprised by how much positive reinforcement translates into better productivity and greater retention rates.
Recognizing people for their achievements can boost organizational culture and leadership. It can come in many forms, such as:
- Work perks
- Appreciation posts
Aside from a recognition program, you can also engage employees with welcome kits and swag packages.
#5 Is team and people-oriented
People are what makes a business—and they are an organization’s most valued asset.
A people-oriented company culture puts an employee’s priorities first. This can happen by recognizing their efforts, caring about their well-being, and making workers feel appreciated.
In addition to this, your workplace culture should be team-oriented. Cooperation and adaptability bring out a collective strength into the work environment and improve productivity.
Teamwork culture focuses on team accomplishments, not on the individual. This way, it allows for tasks to be completed faster and more efficiently.
#6 Values feedback
Fostering feedback culture is key to successful organizational culture in businesses.
Providing or receiving feedback is an effective method of knowing whether you are approaching culture the right way or whether you need to go through a culture change.
Companies that value feedback let their employees’ voices be heard, often leading to higher levels of performance and increased retention rates. This also helps build trust between management and employees.
#7 Inspires growth
Successful cultures inspire employees to learn and grow. Organizations should encourage workers to:
- Expand their knowledge and skills
- Push each other to be at their best
- Keep up with new trends
By promoting growth culture, employees grow either as individuals or as teams. It leads to more innovation and creativity and, as a result, to more profitability.
4 Types of Organizational Cultures
Culture is your company’s personality and 94% of executives believe that a unique culture is critical to business success.
Before you dive into it, you need to figure out what kind of management culture you want to build.
Without further ado, here are the four types of culture:
Adhocracy culture can be defined as a risk-taking business strategy. It lives by the motto “move fast and break things,” a philosophy popular among startups.
This type of work environment is very entrepreneurial. Employees are encouraged to take risks and a lot of learning, innovation, and growth is required.
- It’s perfect for employees who want innovation and growth
- It has a focus on psychological safety
- It can be intimidating for employees who don’t work quickly or aggressively
- There’s a lack of stability due to constant new initiatives
An organization with a clan culture refers to their coworkers as family members and puts emphasis on togetherness.
Clan cultures offer a friendly workspace where relationships, participation, and morale are vital to business success. Managers are more mentors than bosses that give instructions.
- A team who loves working together
- Improved communication levels
- Productivity can decrease due to the unnecessary chatter
- It’s hard to make business decisions since people’s feelings are a top priority
Known also as “control culture,” hierarchy culture consists of structured and process-oriented environments.
These companies are driven by existing procedures, rather than innovation and freethinking. Often, teams are well-oiled machines that focus on results, reliable delivery, and stability.
- Employees have a great sense of predictability and security
- Expectations are communicated very clearly
- Too much rigidity can stifle growth
- The environment can feel inflexible
Market culture is all about results. In this type of culture, employees are goal-focused and business leaders are demanding.
Everyone wants and works to achieve the defined success metrics, which makes it a high-pressure environment.
However, some people find it rewarding when they see the real, measurable results.
- Employees are highly motivated and driven
- The company has improved performance
- The constant competition leads to a toxic work environment
- Employees experience burnout or stress due to the constant pressure to succeed
Have you found a type of culture that speaks to you?
If you did, good! You can now start building the corporate culture of your dreams.
Over to You
Finding the right culture fit is a long process that requires a lot of effort from you.
Hopefully, by seeing successful examples of what a good culture is, you know what to do to drive organizational change and build a culture that follows the seven characteristics described above.
Interested in learning more about company culture, employee engagement, retention, and how to make your workplace truly great? Check out our HR Glossary for more helpful tips and information!
Frequently Asked Questions (FAQs)
Take a look at the frequently asked questions to discover more about organizational culture.
Q1. What is organizational culture transformation?
Organizational culture transformation is an evolving system of values, beliefs, and structures that contribute to the unique psychological and social environment of a company.
It’s a shift that takes place throughout the entire organization and requires changing the minds, hearts, and skills of the workforce to support the culture.
Q2. How is organizational culture created and communicated?
Leaders are the ones that establish the culture and, while they’re vital to it, it’s also influenced by a variety of factors:
- Founders’ values and preferences
- Industry demands
- Early goals, values, and assumptions
- Employee input
Culture is usually maintained through a reward system, leadership, and new employee onboarding programs.
Q3. What are organizational subcultures?
Organizational subcultures form when individuals in a business have shared experiences and values that differ from the dominant culture.
The dominant culture creates the company’s core values that shape employee behavior. Subculture groups are usually created after employees see the need to develop distinctive objectives and values to complete a particular task.
They are formed based on department, identity, task specialty, and geographical separation.