What is corporate culture? Well, the first thing to say is it’s seen a resurgence over the past decade. Whereas it was once a term left to the side, with little or no attention paid to it, it has become an important concept and mainstay in the corporate world. Corporate culture is important, perhaps more vital than other business concepts and metrics, because it can be directly correlated with a company’s success.
Now, that’s a heavy statement to make. But according to Forbes, a lack of company and corporate culture can contribute to nearly $350 billion in lost revenue and productivity. Corporate culture is not just a mantra or a saying that gets repeated for no good reason. It is and should be a core value of any business – whether that’s a big concern or a small venture. In 2020, every company should embody its internal culture and exude that commitment to the external world.
But why exactly should we care so much about company culture? Why does corporate culture matter so much to the outside world and to our experiences at the office? The reason is that it provides employees with a direction, it gives them a sense of guidance, and it acts as a set of principles upon which every member of a company or organization lives. Having a code is nearly always productive. Corporate culture is meant to be exhibited and lived by both internally and externally. It’s intended to provide a set of rules by which the company takes its actions and by which employees conduct themselves.
A 2013 MIT study found that 85% of S&P 500 companies have an ongoing and written commitment to corporate culture. The principles and values that they specify are revealing, with 80% mentioning innovation and 70% specifically referring to integrity and respect. Corporate culture is the lifeblood of any organization. It should be coursing through a company’s veins and be top-of-mind during every decision, no matter how big or small. Corporate culture is important because it influences the direction the company takes.
A company with a weak corporate culture, or one that is completely missing any sense of a code, will suffer in both the short and long terms. A general lack of culture, guidance, and direction will leave employees and customers confused. In the event of tragedies, errors, or mistakes, individuals within the organization will feel helpless, lost, and frustrated at a perceived lack of leadership and internal strength to persevere.
What is Corporate Culture, and Can it Affect Sales?
When you’re considering corporate culture, you shouldn’t confuse it with the broader sense of what corporate America stands for. Rather than being a structure for commerce and industry, it’s more about what it feels to work within and how you work for a specific company or business. Multiple studies have examined how important corporate culture is for retaining and attracting employees – it’s just not possible to argue against how creating a pleasant working environment has a beneficial impact on employee retention and recruitment. Yet, that’s not the only plus regarding healthy corporate culture – it rubs off on customers too.
- According to a 2019 Stackla report, 86% of consumers say authenticity is important when deciding what brands they like and support. That sort of figure is not only striking, but it also represents cold hard sales in an increasingly competitive business environment.
- Another survey, carried out in 2019 by Edelman, found that an astonishing 81% of potential customers need to develop trust in a brand before they consider purchasing. Again, that’s valuable sales that are based largely on the reputation of the supplier for more than four in every five potential clients and consumers.
- Displaying a social conscience is important too. That same survey by Edelman found that 64% of consumers said they’d said buy from a brand or boycott it, solely based on its position regarding a social or political issue.
- If you’re still not convinced, consider a recent Havas Group study that found 77% of consumers buy from brands that appear to share the same values as them.
Promoting a healthy and conscientious company culture is a no-brainer. It’s just an unavoidable fact that your customers are a lot more aware of how responsible corporate organizations can change the world for the better – and they’re no longer prepared to take no for an answer in 2020.
Employees who understand the significance of the company and its mission statement will have higher levels of morale and productivity. When that culture gets set upon a strong foundation and mission statement, it provides employees with a sense of guidance and direction. That direction will assist them in their daily tasks and routines. By having a properly defined set of principles, employees within the organization will be able to turn to them for guidance and purpose when the going gets tough or new things arise.
Higher levels of employee morale equate to higher levels of employee retention. Individuals who are happy, satisfied, and fulfilled at their place of employment will tend to remain at that station longer than their counterparts who do not feel secure. Strong company culture can provide an employee with a sense of belonging and a feeling of fulfillment. Employees will likely be more ready to adopt that culture and develop an unyielding belief in the company statement.
A strong corporate culture will prove infectious. It will be displayed in corporate and retail settings, noticed by customers, clients, and your competition alike. You should extend your corporate culture to company advertisements and marketing materials. Perhaps most importantly, however, it will be seen in how your employees behave and conduct their duties – they’ll become living ambassadors for something that’s perceived to be better, unique, and ethical.
Such a culture will create a strong brand image, one that becomes deeply associated with the company and the vision it’s striving to achieve. It will become famous, synonymous with your brand, and it’ll build a positive, profitable reputation all by itself.
Attracting New Hires
Think of some of the most iconic brands and companies. What do you think of their culture and of how their offices are spread out? How do these organizations treat their employees? How do they envision themselves as corporate citizens? Think of Google, Starbucks, and Costco. These iconic brands and companies have built a reputation based partly on a healthy, desirable internal culture. In turn, they can attract some of the brightest, most capable candidates. These are applicants that actively seek open and new positions at these companies.
The Rise of Corporate Culture
Understanding the importance of corporate culture is one-thing. But why has there been a sudden shift in how corporations perceive and prioritize culture? The reason is simple, in the interconnectedness of the internet, nothing is private, and everything gets noticed – especially the bad stuff. Humans like talking about failures more than they ever celebrate successes. Corporate culture is now on display – 24/7, every single day and night of each year. Corporate employees actively and willingly discuss the perks and benefits associated with the company they’re employed at on social media and with their friends.
Likewise, employees aren’t shy to discuss an employer’s shortcomings, and the web is the ideal place to make grievances and disappointments public. A company with a poor corporate culture can end up shunned and blacklisted by many potential candidates. Things can go downhill almost overnight, too – that’s the power of the world wide web. Applicants may have heard from a friend, even a friend of a friend, read a negative news story, or seen bad and poor Glassdoor reviews. There are just a lot more ways to gain a negative reputation in 2020. Whatever the source of news, lousy press nearly always hurts a company. As almost everything is published online and searchable, a company has to make a concerted effort to ensure that its image and online presence remains squeaky clean.
Not taking care of your online presence and your brand image can be disastrous. Not only can a company lose out on talent, but they may alienate customers and lose corporate clients too. By having a strong corporate culture, that can be avoided. But you must remember to maintain those values day in and day out.
How To Get Your Corporate Culture on Track
If you’re asking yourself what is corporate culture, the chances are that your company has a poor or unsatisfactory grasp of the concept. If that’s the case, there are a few remedies you can turn to, and all of them are worth considering. Though not easy, taking action will yield dividends a little way down the track. The first, and most obvious step, is to set a tone and structure for what you want the company’s culture to convey. How would you like the company culture to be? Write your initial thoughts down, and then work to expand them into something more coherent, robust, and detailed.
The next step is to discuss that with your co-workers and colleagues. Brainstorm with them on what type of company you want to be. Discuss how you want to be viewed both internally and externally. Talk to close family and friends or a focus group and find out what your current brand image is. Is it what you want it to be, or do you need to work on making it better?
From there, implement things slowly. Culture needs to spread organically, so talk to your management and leadership teams and have them make small, subtle changes gradually. Perhaps a random work from home day for the entire office would be an excellent place to start, or providing the Friday after Thanksgiving off for the whole of the company would help turn the tide and set a new tone.
Conclusion: What is Corporate Culture? And When Should You Change it?
The time to change your corporate culture is right now, and making the smallest adjustments will become infectious. Be subtle and work carefully, and your employees will begin to see and notice these changes over time. As you start to ramp up your efforts, write down the company guidelines and vision. Reiterate these values to all your employees and communicate how you want the culture to be in the future – then, encourage your employees to live by these values.
If your staff sees you, management, and the leadership team living by these values, they’ll begin to do the same – and to appreciate how it makes the organization more enjoyable, safer, and a more secure place to work. Culture can be the difference between employees just having a job at a company or considering it to be a place where they’d like to make a career. Installing a company culture takes time, resolve, and effort. It’s not instantaneous, but it’s one of the best things you can possibly do for the organization.