Workplace Culture: What It Is, Why It Matters, & How to Define It

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Workplace Culture: What It Is, Why It Matters, & How to Define It

Culture is the character and personality of your organization. It's what makes your organization unique and is the sum of its values, traditions, beliefs, interactions, behaviors, and attitudes. Here's an overview of why workplace culture is important, what affects it, and how to define it.

Why is workplace culture important?

Culture is as important, if not more important, than your business strategy because it either strengthens or undermines your business and the objectives it is trying to achieve. Culture is significant, especially because…

  • It attracts talent. Potential job applicants evaluate your organization and its climate. A strong, positive, clearly defined and well-communicated culture attracts the right fit and talent.
  • It drives engagement and retention. It creates a work environment that either strengthens or weakens employee engagement and retention.
  • It impacts happiness and satisfaction. Research shows that employee happiness and satisfaction is linked to a strong workplace culture (Source: Deloitte).
  • It affects performance. Organizations with stronger cultures outperform their competitors in financial performance and are generally more successful.

What affects culture in the workplace?

The short answer is: everything. A multitude of different factors in the workplace play a role in developing a workplace culture, including:

Leadership: the way your leaders communicate and interact with employees, what they communicate and emphasize, their vision for the future, what they celebrate and recognize, what they expect, the stories they tell, how they make decisions, the extent to which they are trusted, and the beliefs and perceptions they reinforce

Management: how your organization is managed - its systems, procedures, structure, hierarchy, controls, and goals/objectives; degree to which managers empower employees to make decisions support and interact with them, and act consistently

Workplace practices: practices related to recruiting, selection, on-boarding, compensation, benefits, rewards and recognition, training and development, advancement/promotion, performance management, wellness, work/life balance (paid time off, leave, etc.), as well as workplace traditions

Policies and philosophies: employment policies including, but not limited to, attendance, dress code, code of conduct, and scheduling; organizational philosophies such as hiring, compensation, pay for performance, and internal transfer and promotion

People: the people you hire - their personalities, beliefs, values, diverse skills and experiences, and everyday behaviors; the types of interactions that occur between employees (collaborative vs. confrontational, supportive vs. non-supportive, social vs. task-oriented, etc.)

Mission, vision, and values: clarity of mission, vision and values and whether they honestly reflect the beliefs and philosophies of your organization; how inspiring they are to your employees; extent to which the mission, vision, and values are stable, widely communicated, and continuously emphasized

Work environment: objects, artifacts, and other physical signs in your workplace; what people place on their desks, what the organization hangs on its walls, how it allocates space and offices, what those offices looks like (color, furniture, etc.), and how common areas are used

Communications: the manner in which communication occurs in your workplace; degree, type, and frequency of interaction and communication between leaders and employees and managers and employees; extent of transparency in sharing information and making decisions

What is your workplace culture?

Most of us let our workplace culture form without defining what it is and what we want it to be, and that’s a mistake. For example…

  • We create policies and workplace programs based on what other employers do versus whether they fit our work environment.
  • We hire employees who don't fit on our teams.
  • We tolerate management styles that threaten employee engagement and retention.
  • We don't create and communicate a clear and inspiring mission, vision, and set of values.
  • Our work environments are lackluster.
  • We don’t consider how our everyday actions (or inaction) as leaders are affecting the formation of our culture.

For these reasons, it’s important to step back, define, and evaluate your workplace culture – both what it is now and what you want it to be in the future – and how all of the factors above are either contributing or taking away from your desired culture. Although it can be very difficult to define, assessment tools and surveys can help you gauge your culture. They may reveal gaps between the culture you want to attain and the culture you currently have.  In addition, observation, examination of workplace behavior, meetings, discussions, and interviews can expose your workplace climate. The important part is to start somewhere and open up a dialogue with your leadership team about it.

Keep in mind that culture is always a work in progress. It can and will change and evolve over time.  Make culture as important of an objective as your business strategy… it’s too significant to ignore and shaping it is one of your most important responsibilities as leaders and HR professionals.

Additional Resources

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