The word ‘culture’ has been making the rounds a lot lately. More specifically, the term work culture. In today’s day and age, people are becoming more and more aware of things like mental health and behaviours that affect it. And so, work culture has also taken centre stage in many companies.
Particularly, many small companies tend to lack a work or company culture and as a result, could end up suffering in the long run without even realising it!
So, in this blog, I have given you an ultimate guide to work culture. I have covered topics right from what it is, why is it important and factors that affect organizational culture to how you as a startup founder or HR lead can play a role in improving your company’s culture.
- What is work culture?
- Benefits of a good work culture?
- What makes a great work culture?
- Subtle signs of a toxic or unhealthy work culture
- How can a bad work culture affect your company?
- Who is responsible for work culture anyway – Leadership or employees?
- Types of work culture
- What are sub-cultures within an organization?
- 5 Steps to take to develop a healthy company culture
What is work culture?
Before we dive into the details of what makes for good and bad company culture and how should you assess our organization’s culture let us first look at what work culture is not.
Why? Because there are many misconceptions around the term and it is important that they be cleared!
What work culture is not!
Very often people assume organisational culture to be associated with materialistic things such as a table tennis table in the office space or free food.
Company culture is not a series of things you provide to an employee. But things like these are tools to make employees comfortable in a workspace. They do not build or cultivate any kind of work culture.
Work culture in actuality means…
The set of values, behaviours and attitudes that form the basis of your company’s work environment. It is the underlying subtleties of every employee’s behaviour put together that have an effect on productivity at an organization level. Yes, your work culture plays a huge role in productivity.
Flamholtz and Randle (2011) in their book “Corporate Culture: The Ultimate Strategic Asset” define culture by identifying as well as explaining 5 key dimensions that determine it. They speak about,
- A customer orientation
- A people orientation
- A process orientation
- Strong standards of performance
- Accountability, innovation and openness to change.
They provided a highly sound and tested set of dimensions that when taken into consideration becomes easier to manage corporate culture. But why is work culture so important in the first place?
30 signs your work culture is toxic! – Company culture checklist!
Download now for free to check and see if your company has subtle signs of unhealthy work culture.
Benefits and importance of a good work culture?
Now that we know what is and isn’t work culture, we should take a look at why it’s important. Honestly speaking, good work culture is invaluable and its benefits cannot be put into words. So, no matter how many benefits I list here below, it’s important to understand that the benefits go way beyond a meagre list like this one.
Either way, let’s have a look at some of them.
Helps maintain a positive brand image
You may not realise it, but your work culture affects the way you are seen on the outside. It plays a role in the way your brand is perceived by others. Think about any company, at random. Now think of a value you associate with that company.
Say, for example, I thought of Apple. The value I associate with them is innovation. Why? Because apple puts innovation at the centre of everything they do. It is engraved into their DNA, in the deepest parts of their work culture so to speak. It is the centre of the way they work and their products.
So, when people think of apple they associate the brand and its image with innovation and innovative products.
Improves employee morale, engagement and hence retention
When you have a positive work culture, employees feel like they are valued. When they provide inputs that are considered and used by top management, they feel like they are an integral part of the organization. Employees also feel a lot more confident when they are heard and recognized.
All of this put together helps boost employee retention.
When employees have high morale, they are automatically motivated to work better. When they work better, they automatically provide better outcomes and their customers are happy. This is not restricted to sales employees who directly deal with external customers. This also involves the internal customers.
For example, a happy HR employee will be able to work better while dealing with other employees or department heads (who are the HR’s internal employees). When customers are happy, there’s a higher chance they will stay with you for a longer time, and probably even become loyal to your brand. As a result, you are better able to retain current customers while acquiring new ones.
So, I believe that…
Great work culture = Happy employees = Happy customers = Growing revenues
What makes a great work culture?
So what makes a great company culture? There are many things to consider here, most of them seem obvious when you see them, but it’s crazy how often and ever so easily they get overlooked!
- A clear vision mission and set of values exist in the company
- Transparency in the way things work
- Kindness at work
- 2- way communication between superiors and subordinates
- Trust among employees, across levels and departments
- Visible and accessible senior management
- Top management and office leadership practice what they preach. They lead by example.
- Absence of office politics
- Individual growth opportunities. Employees are able to develop their own careers and skills while also, working on their aspirations
- Employees are celebrated for their good work (great reward system in place) and not berated for making mistakes
- There exists equality, equity and fairness
- People care for each other and hence there exists a community within the organization. People are friends more than colleagues
- Employees feel comfortable coming to work and are respected
- People are accountable for their work and have the ability to take constructive feedback
Subtle Signs of a toxic work culture
Heard of Peter Drucker? A Management consultant, Author, and Educator, he has made major contributions to the work of modern business. According to him, “Culture eats strategy for breakfast.” This means that no matter how strong your corporate strategies are if your work culture is toxic, you’re in trouble!
While having a great work culture is ideal, many companies start slipping into a toxic space of work without even realising it. And by the time they want to make a change, it may be a little too late. These are some of the signs you in that boat too.
No culture = bad culture
People very often think that because they don’t have any set of values and traits that define their company they don’t have any company culture. But they do not realise that no culture also means bad culture!!!
How can a bad organisational culture affect your company? + Examples of real events
Bad organizational culture can have detrimental effects on your company. And because the signs of bad company culture are so subtle, more often than not, they go unnoticed. They brew under the surface and suddenly, like a volcano erupt when you least see them coming.
I have also given 2 examples below, of very different companies. Problems that initially started out as not very big, not very obvious, ended up causing major issues.
What are walkouts? Basically, a group of employees, realised that they are not being heard at all in the company. Maybe they have some needs or requirements that aren’t getting fulfilled. As a result, as a last resort, employees stage a walkout. As the term suggests, they simply walk out. They quit the company and just leave.
There are 2 types of walkouts that can occur, of which one can be seen but the other covert. What are they?
This is the case when employees either decide to stop showing up to work as a protest or quit entirely.
You may think that your company isn’t at that bad a stage where people will start leaving. But it’s a slippery slope that is better to stay off of.
Emotional or mental walkouts
This is a case that is not so explicit. This means that you won’t literally see employees leave. But, either emotionally they have stopped caring about your company. So they won’t go the extra mile to do things.
Or, mentally, they are so drained that they just don’t have it in themselves anymore to function at 100% productivity. Employees will still come to work every day. But they are actively disengaged from your organization.
Examples of bad work culture that resulted in major downfalls!
Google walkout of 2018
An example of this is when in Google, 2000 employees staged a walkout in the year 2018, on the first day of November that year. This walkout was triggered by employees who felt like they weren’t heard by the senior management.
What was initially supposed to be some employees protesting the fact that women didn’t have equality in the company, ended with 2000, yes you read that correctly, as many as 2000 employees, both men and women up and left!
Boeing and their merger with McDonnell Douglas!
Have you watched the February 2022 released documentary “Downfall: The case against Boeing” on Netflix?
This movie shows how, when the airline manufacturing company Boeing, merged with McDonnell Douglas, there was a shift in company culture. This merger took place in the year 1997. Boeing as a company initially was extremely product-centric. They heard all the input given to them by the engineers and people working on the aircraft. After the merger, the focus shifted to ‘reducing costs’ so much so that the head office was shifted to another state in the US so that decisions would not be affected by the engineers! We all know about the 2 major crashes of the then-new Boeing 737 Max aircraft, just within a few months from each other.
You might think that this is an extremely steep case. A drastic situation that hardly ever occurs. But it happened. And over 300 people lost their lives. This is how important company culture is!!! It can either pave the way for your company’s success or causes a major downfall!
Who is responsible for work culture anyway – Leadership or employees?
Now that we have taken a look into good culture Vs Bad or toxic culture and the importance of having a good culture, let’s move on. Who forms culture.
Does it just happen?
Does anyone consciously make a difference?
Can a single employee or manager make a difference?
Culture gets built top-down but it is defined bottom-up!
What does this mean? The responsibility of setting guidelines in place for a healthy company culture lies on the leadership team. However, maintaining that culture is the responsibility of every single employee in the organization!
In short, every single person has to shoulder the responsibility of keeping up the good company culture in an organization.
Types of work culture
Apart from the fact that companies can have either good or bad cultures, there are certain types of cultures that prevail in companies. These cultures can either be good for your company or bad.
Let’s have a look.
- Culture of fear – When managers run things based on fear. Employees work not because they love their job, but rather because they fear their supervisor. It could also be fear of losing your job (lack of job security) or fear of not getting paid.
- Clan Culture – This is the least competitive form of culture. It runs on the basis of goals and values, and the commonality found in these factors. It is based on tribe like or familial bonds or groups formed based on similar goals and values.
- Adhocracy Culture – Derived from the term ‘Ad hoc’ which means ‘when necessary or needed’, this culture in corporates is based on the ability to adjust and adapt quickly to changing situations.
- Hierarchy Culture – This focuses on creating a set of strict rules and levels within the organization. People lower down the rung must follow the guidelines given by the upper management and company leadership.
- Market Culture – This culture focuses on competitiveness, both among the company and its competitors as well as between employees! This is probably the most competitive corporate culture to exist in companies.
- Purpose-driven culture – Purpose in anything that you do drives your day to day tasks and guides your workflow. So, here, purpose drives the functioning of the organization.
What are subcultures within an organization?
Just like the name suggests, a subculture is a culture within a culture. How does this make a difference to corporate cultures?
Say you are a company of 100 people. A total of 8 departments of varying sizes. While your company will have a fixed structure, way of functioning and well-defined culture, each department could develop its own work culture within. Now, this may not always be ideal. Especially in scenarios where your company’s culture is amazing, but certain groups of people working together have developed extremely toxic relations and business processes.
This becomes dangerous. How? You can’t spot subcultures that easily. But could affect your company one team at a time. Look out for departments or teams with a lower than (company) average retention rate or with disengaged employees.
On the other hand, when your overall company culture is toxic, positive subcultures are like a breath of fresh air.
5 Steps to take to develop a healthy company culture
With these 5, simple steps, you’ll be able to set up a work culture so strong that it will put your company on the path to success (and if you already have a great work culture this will only benefit you even more!).
Also, while it’ll probably take you 5 days to go about working on these steps (as mentioned above), setting up a company culture is an ongoing, never-ending process that requires maintenance.
Let’s have a look at the 5 steps
Time needed: 5 days.
Build work culture in 5 steps!
- Define a set of values, behaviours to form your work culture
Google any company, and look at the section on their website that talks about their values.
These values should be seen in not just the way they serve clients but also in the way they treat employees and carry on their day to day tasks.
- Enforce the values and set up procedures to ensure every department and team follows the work culture
Having a set of rules around this will ensure that managers at all levels follow and enforce them.
This can also help avoid the formation of subcultures within smaller departments or teams.
- Unblock communication and even more so, encourage people to speak up!
A key element of building a healthy work culture is to ensure 2-way communication.
Organize annual or bi-annual townhalls, where everyone gets the opportunity to open up and talk about their opinions on issues.
Make employees aware that the office doors of top management are always open to them when they have problems. And ensure that you are available when people come to you with problems.
- Put compliances and SOP (standard operating procedures) in place
This goes without saying, but if employees are constantly living in the fear of getting fired or not getting their salary, they aren’t going to work at their optimum levels!
Not just salary and job security, focus on other hygiene factors about job necessities as well.
- Set up recruitment processes that can check each candidate’s culture fit
Ensure that various stages in your recruitment and hiring process have a way of identifying how the person works as well as their core values and behaviours.
Not all values of every single employee will match your company’s, but basic things like honesty, hard work, trust, equal opportunity etc. should.
Good work culture is where employees are encouraged to
1. Share their input
2. Work in teams
3. Collaborate and learn from everyone in the team
4. People trust each other
5. Employees are driven by purpose and meaning rather than fear and insecurity
You can do so in 5 simple steps
1. Set a list of values and behaviours that you wish to be a base for your work culture
2. Enforce these values and behaviours across all departments and teams
3. Put in place SOPs and ensure your company is 100% compliant in every way possible
4. Encourage employees (especially those lower down in the hierarchy) to share their thoughts on things, both business-related and otherwise
5. Ensure that your recruitment process has a way of understanding candidates’ values and hence checking if they’ll be a good culture fit.
3. Challenging (not in an unhealthy way)
Not to be considered as tax, legal, financial or HR advice. Regulations change over time so please consult a lawyer, accountant or Labour Law expert for specific guidance.