What is the key ingredient to a successful company?
There are lots of factors affecting the success of a business, whether big or small, but there is one that’s continually cited as the real make or break factor for an organisation. It can differentiate one company from another, for better or worse.
A strong organisational culture is the key ingredient to a functional and successful organisation.
But, what is company culture, and how can it help create a better, and more successful workplace?
What is company culture?
Bill Taylor, co-founder of FastCompany defines company culture as follows:
“At its core, the role of culture is to reinforce a sense of belonging, a shared commitment among colleagues about how they solve problems, share information, serve customers, and deliver experiences.”
It’s something that can only be understood from the inside of a company, and can be hard to evaluate otherwise.
In a 2013 global survey conducted by PWC involving 2,200 corporate managers, 84% of the respondents said a strong company culture is critical to business success. So how can a business ensure that their culture is something that employees want to be part of?
How to build company culture:
Company culture can emerge organically, but the best companies are deliberate about it.
For example, the eyewear brand Warby Parker have what they call a ‘Culture Team’. This dedicated team is tasked with ensuring that the company is a great place to work for it’s current employees, and to instill the core values in new hires. This helps both maximise their job satisfaction at Warby Parker, and to reduce the risks of a bad hire. The U.S. Department of Labour puts the cost of a bad hire being at least 30% of the employee’s first-year earnings, so it’s not a mistake that should be made!
Even if someone is good at their job, if they don’t enjoy working at a company — this could be for a variety of reasons — they are likely to leave sooner or later. Furthermore, if a disengaged employee doesn’t pull their weight, other employees can get burned out making up for it, affecting the whole organisation.
In fact, 80% of employee turnover can be pinpointed to bad hiring decisions. It’s something worth investing in!
Benefits of a strong company culture:
Well, there are lots. If both the company’s values and employee’s values can align, both are more likely to perform better. People are proven feel more competent and more motivated while working if they enjoy their workplace, as company culture can be a very influential factor in job satisfaction. This is why hiring people based on only job titles & skills is not necessarily the best way forward. Two people could have identical resumés, but one might be much more productive in the work environment provided to them. Or, if a company places a strong focus on collaboration yet an individual prefers to work autonomously and realise their own ideas, they probably won’t function well at that company, even if their ideas are great.
Motivated employees are likely to stay around longer. A great culture increases employee retention and saves a company time & money hiring someone new. Often, the longer an employee stays at a company, the more efficient & productive they become. This means that the costs of on-boarding a new employee are even higher, as the new person will take time to get to up to the same level of productivity. HR recruitment tools like SymbaSync that focus on hiring based on not only skills, but ‘fit’ to a role are shown to be much more effective at speeding up on-boarding, reducing turnover, and increasing job satisfaction.
There are real advantages to creating and nurturing a strong organisational culture. It’s worth the investment!
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