Importance of Organizational Culture – The Extent it Colors the Environment for Employees

The importance of organizational culture is felt more than it is seen. Why? It is because there are so many written and unwritten rules. What’s encouraged subtly and what’s frowned upon overtly? These matters drive an employee’s decisions and subtly show their impact on organizational culture.

Organizational culture is not just about the kind of clothes one wears to work. Nor is it whether one can send in a text message as opposed to a follow-up phone call with a professional associate. It digs deeper into areas such as decision-making, shared motivation, and team-building. These are the foundations for whether organizational goals are met or not.

Impact of corporate culture – Is there a debate?

There has been some chicken-and-egg debate as to whether high performance breeds an ethical workplace culture or the other way around. There is plenty of research conducted in this area by respectable institutions such as Gallup. It says that a clear causal relationship exists between fostering a happy, healthy workplace culture and reaping the rewards. High performing sales and services are often a result of the impact of corporate culture cultivated with care.

The Denison Organizational Culture survey referenced in detail by Dan Pontefract addresses this debate. Irrespective of whether the offering is a product or a service, the business that focuses on engagement in its work culture enjoys better performance than the ones that don’t. The comprehensive study was carried out over separate occasions across 95 companies. It suggests that they prioritize organizational culture over customer satisfaction, and this has come back to give better results in sales and customer service performance.

According to the survey, the four items that the organizations followed uniformly with their workforce were involvement, consistency, adaptability and mission. By showing the employees that the management is involved in their well-being and their performance, and by facilitating their performance through training programs, the organization is setting up trust and positivity. Fair and predictable behavior on the part of the top leader is expected. So is the readiness to embrace change and look for a better way to carry out tasks. Finally, clarity in communicating the objectives of the organization and what it stands for are profoundly essential. When these four aspects of the work culture are in place, employees feel secure and effectively stay engaged with their roles.

The ideal origin of organizational culture and leadership

A vital point made by Pontefract is that creating a positive impact of corporate culture is a job for the senior members in the organization. They need to get a message out that the organization cares about being involved. Promoting a positive organizational culture and leadership at all levels is crucial for it to be effective.

The importance of culture in business instantly translates into encouraging figures of customer satisfaction, lowered absenteeism and attrition, and heightened employee productivity and stock performance. The most significant benefit is among the brand image of the business created as a much sought-after employer who receives job applications without even announcing a recruitment drive.

Here comes the considerable question as pointed out by Pontefract whether an organization should place company culture before performance or vice versa? What most companies currently follow despairingly is a short-term view of focusing on performance rather than an engaged work culture. What they tend to ignore is that an engaged work culture will foster improved performance and growth. Perhaps, in the drive towards sustainability in the future of work, organizations will cultivate a broader outlook and give more value to organizational culture.

– Dan Pontefract, If Culture Comes First, Performance Will Follow, Forbes
– Dan Cable and Freek Vermeulen, Making work meaningful: A leader’s guide, McKinsey Quarterly

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