Why is Company Culture Important?

You’ve heard the term thrown around a lot: company culture. But what does it mean? And is it essential to create a positive company culture for your team? If company culture seems like an abstract or even unnecessary element of running a company, think again.

Creating company culture is one of the top priorities CEOs should take on today for employees and customers alike. Company culture’s role in business is invaluable to creating productive, dynamic work environments that support long-term growth (hello, company success). 

Everything starts with culture—but let’s start from the beginning.

What is Company Culture?

Company culture refers to the ideas, customs, or social behaviors of a company and its employees. Do you work at a formal company with a traditional management style? Or is your environment more relaxed and casual? And which holds more value to you?

Companies that work hard to foster a culture people enjoy being a part of will result in more engaged and productive employees – leading to better performance for everyone involved. Ultimately, culture impacts every aspect of company performance, from leadership to revenue growth.

How Do You Create a Positive Company Culture?

Establishing trust, defining an ideal workplace environment, setting clear expectations, and honest communication are integral components to creating a culture worth bragging about. Every successful organization has a unique workplace culture, often led by an effective leader.

While leaders do not bear the entire burden, it will fail to improve without their inherent guidance. The structure and vision for a company transcend from leadership, so having a solid foundation to start is essential. 

Ensuring your employees’ respect and value each other falls second in the hierarchy of importance. It would be hard to work as a team if a quarterback can’t trust his wide receiver to catch the ball. And make for a terrible football game. A positive team collaboration built from the same foundation of respect will not only make your business more successful but create a great company culture while doing it. 

Benefits of a Positive Company Culture

We’ve covered the what and the how, but what about the why? Creating company culture is about company values and prioritizing employees and their contributions so they feel valued. Here are some of the top benefits to consider:

Increase in Employee Engagement

A company culture that focuses on the needs and desires of its workers has a massive impact on employee retention.

According to a study conducted by an independent research group, only 32% of workers indicated they were engaged at work during the first quarter of the year. In other words, nearly two-thirds of all employees aren’t engaged in their company, which can hurt company culture. Where there’s no passion, there’s no drive, so increasing company engagement will ramp up productivity. 

Decrease in Turnover

One of the biggest challenges company leaders encounter is turnover.

Company culture plays a significant role in job satisfaction. For instance, a company where the culture encourages collaboration will help employees feel part of a team – even if they aren’t working daily with colleagues. No one wants to feel they’re just a number. Setting expectations of jobs roles and measuring those with rewards and benefits will offset that turnover rate.

Better Customer Experience

A company’s culture plays a vital role in its customer relationships. When business leaders work to build a company culture that employees enjoy being part of, they’re likely to provide better service – making clients feel valued and confident in their ability to provide exceptional products and services.

Higher Productivity

Company culture help employees feel more motivated to work harder towards achieving company goals. In addition, company culture increases employee morale and job satisfaction, so employees enjoy what they do and look forward to coming to work. 

For company culture to positively impact employees’ productivity, company leaders must encourage open dialogue throughout the organization. Giving employees a voice in decisions and objectives will make them feel more valued and understand that their opinion matters.