Corporate culture has always been important in business performance, but it has rapidly transformed from a secondary consideration to a foundational concern. One thing is for sure – whether you know it or not, every company has a culture. The question is whether or not it is built intentionally to optimize business performance. Companies that place client interests, ethical decisions, and concern for their workers at the core of their operations usually produce high performance as an outcome. Failure to use corporate culture to your advantage is a missed opportunity, while total lack of regard for corporate culture can cause significant damage including penalties, complaints, fines and loss of reputation.
Organizational Leadership’s Effect on Culture
Leaders within an organization set the tone for corporate culture. They shape the way people behave and think, influence decisions and ultimately develop long-term effectiveness for the business. Leaders should be seen as strong role models who strive for excellence and exhibit behaviors that reflect the organization’s philosophy and values.
Corporate culture is typically shaped through:
- The behavior and actions of leaders
- The allocation of resources
- The behaviors that are rewarded and discouraged
An organization’s leadership can and should play a highly influential role in defining corporate culture. This requires the allocation of appropriate resources to purposefully evolve the performance culture. It is essential that organizations are able to keep pace with changes within the business environment and gain a competitive advantage in order to enjoy sustained success. Leaders are responsible for making sure this happens, and the corporate culture should be continually on their radar. In fact, objectives for cultural development should be given an equal amount of attention as sales and operational objectives, and continually monitored through management dashboards (or score cards). When people are held accountable for effectively evolving the culture, the right organizational behaviors are reinforced.
How Corporate Strategy Affects Organizational Culture
If corporate culture is emotional, and corporate strategy is rational, what is the relationship between the two? One cannot successfully function without the other. No matter how polished or proven a strategy, it is always the people that make the real difference. And, without strategy, corporate culture doesn’t get the organization to the highest levels of performance. Very often, strategy and culture clash because of strategic decisions made from above that clash with cultural ideals. This is largely because leaders underestimate how important cultural alignment is to the effectiveness of a strategy.
Good communication lies at the heart of a successful corporate culture, and this includes communication of strategic decisions and direction. A strategy may be flawless, but if employees have no knowledge of it, they will be misguided in its execution. When employees are engaged in strategic processes and understand their purpose, they become motivated, empowered and more productive.
The Relationship between Corporate Culture and People Leadership
Leaders are responsible for developing and shaping corporate culture. It is the responsibility of leaders to ensure the desired culture is naturally evolving throughout the organization. Organizational culture is what binds a workforce together, and it also defines how employees interact, complete tasks, and take pride in their roles.
There is an old story about President John F. Kennedy’s visit to NASA as they worked to put a man on the moon. During a visit to the NASA space center in 1962, he noticed a janitor carrying a broom. He interrupted his tour, walked over to the man and said, “Hi, I’m Jack Kennedy. What are you doing?” The janitor replied, “Well, Mr. President,” “I’m helping put a man on the moon.” The point is that in a high performance culture, leaders create an environment where the work of every person is valuable and important to the success of the entire operation.
Selecting the right workers is also essential in building a high-performance culture. Within what is legal and ethical, always hire based on cultural fit and talent. Workers who share the corporate philosophies and align with its purpose and values will have the greatest success within the organization. Recruitment processes should be developed to attract employees with values and beliefs that reflect the corporate culture. Conversely, if you hire bright, energetic, and capable people who are opposed to your culture, they will use all of that talent to undermine it.
Consistent behavior and results can be achieved by following clear management practices that influence culture:
- Commitment: Set realistic yet challenging objectives for employees to inspire, empower and motivate.
- Clarity: Set specific and clear performance goals.
- Standards: Carry out regular reviews of both leadership and the entire team to ensure company values are being adhered to and that everyone is connected to the culture and their work both intellectually and emotionally.
- Recognition: Recognize and reward outstanding performance.
Assessing Your Corporate Culture
Corporate culture can be a challenge to assess and measure. However, assessment is an essential consideration for organizations that want to maintain their momentum and a competitive advantage. An important tool in determining where your corporate culture is today, and whether or not it is moving in the direction you desire, is culture assessment. While there are many culture assessments on the market, those that focus on measuring high performance culture provide the most useful business insights. Performance culture assessments also make tangible the actions required to position the culture to drive optimal business performance.
Organizations have varying traits that dictate where they fall on a hierarchy of performance. The Performance Climate Survey from Performance pH allows organizations to gain valuable insights into performance and culture, and to see where they are positioned within the hierarchy of performance. The survey takes just 10 minutes for the average user to complete and consists of 30 questions. Once the survey is complete, you will receive a comprehensive report that details the current position of your organization on the hierarchy and outlines your strengths and weaknesses, and the actions you could take in improving your strategic direction, accountability intentional culture, empowerment and relational trust, work environment and a variety of other areas.
Each organization is different, and the results from your survey will either confirm that your corporate culture positions your organization for high performance or provide suggestions and encouragement to make improvements.
While corporate culture may seem less tangible than other business strategies, it can have a measurable impact on your bottom line. Positive corporate culture enhances productivity and performance, improves employee engagement and drives a business forward.
However, before you can enhance corporate culture, you need to understand it. Organizational assessment tools are the first step, and through regular use, they will help you gain the essential insights that you need to create and maintain a high performing corporate culture.