Corporate culture – myth or reality?

  • Mirta Alfirev
  • 10. November 2021.
  • 6 min read
Have you noticed that an increasing number of companies are adding the word culture to the human resources department? Let's find out why!

Have you noticed that an increasing number of companies are adding the word ‘culture’ to the human resources department? Although research has shown that corporate culture is one of the biggest indicators of a company’s success, it took a long time to start talking about it. It is important for employees that their beliefs and values ​​match the values ​​of the company because it gives them a sense of purpose. Also, value matching has been proven to increase employee engagement and performance. The importance of corporate culture is best demonstrated by recent research, according to which employees would rather tolerate lower pay and give up high titles than deal with a bad environment in the workplace. However, a United Minds survey conducted in 2019 showed that there is a big mismatch between the values ​​that the company communicates and the actual actions of the same company.

Of course, the biggest challenge is patience. On the one hand, we are all accustomed to dynamic environments and rapid changes, and on the other hand, changes in corporate culture require many years of work and commitment at all levels. In addition to patience, changing culture requires perseverance, dedication, and discipline. Also, it takes courage to continue when it is most difficult. It requires honesty – to acknowledge to ourselves if there is a mismatch between what we would like and how the organization actually operates.

Corporate culture signifies the character or personality of a company. In order to change a company’s personality, we must first become aware of our own patterns of behaviour. Some patterns are easier to spot and some are harder to see. Namely, culture includes the behaviour of the organization and employees, but also the goals and philosophy of the organization, visible structures, and processes, as well as assumptions that occur from thoughts, feelings, beliefs, and perceptions of individuals within the organization.

It is important that the company becomes aware of an invisible part of its culture. Although this part is not explicitly communicated, employees quickly and instinctively begin to adopt it. In order to analyze your corporate culture, you must define several elements: company history, location, vision, values, ​​and practices. Vision contributes to purpose, and values ​​form the core of corporate culture and define guidelines for behaviour. Practice, on the other hand, supports values ​​through activities defined by the company. In the end, the most important segment remains – people. A culture cannot be built if there are no people behind it who nurture and implement the same culture. That is why it is extremely important that employees accept values ​​and act in accordance with them. This is especially true of company leadership. Good leaders understand that corporate culture influences how employees work and think, how they behave, and how they experience their work. Given that leaders influence culture, and culture influences employee engagement and motivation, it’s no surprise that healthy cultures are the result of effective leadership and management. Namely, managers can talk day and night about the culture they want to see, but ultimately employees will be guided by the behaviours they see in the organization. Especially behaviours that have been previously appreciated, recognized and rewarded.

In times of crisis, a company’s risks are growing, and most often include inappropriate investments in people and a lack of responsibility and consequences for undesirable behaviour and non-adherence to values. Often the cause of the crisis is the lack of diversity, equality, and inclusiveness that occurs with unclear ethical standards. However, in the last few years, and especially during the pandemic, we have increasingly witnessed high-stress environments in which unrealistic and overly ambitious goals are at the expense of core values. According to a recent survey, nearly a third of employees say their managers do not behave in line with company values. Leaders, on the other hand, are often confused by culture because most of the culture is found in unspoken behaviours, ways of thinking, and social patterns. As a result, they often do not deal with culture or redirect it to the human resources management department. At the same time, managers do not understand that the development of culture is not a waste of time, but an investment in the company. Namely, a healthy corporate culture can be a catalyst for change and resilience of the company. Such companies can therefore be sustained, and sometimes even thrive in the most challenging moments.

A good corporate culture has a positive effect on employee performance, morale, satisfaction, commitment, and loyalty, but also on employee attitudes and motivation. retention and commitment to the organization. Also, a good corporate culture ensures the attraction and retention of talented employees which directly increases the value of the company. John Kotter and James Heskett have long proven that companies with a healthy corporate culture have 516% higher sales compared to companies without a healthy culture. Thus, a good corporate culture not only helps employees and clients understand the organization and its vision, mission, and core values but also increases the overall value of the organization. In order for a company to remain successful in the market, it is important to make an analysis of the HR process and adapt to objective needs. A healthy culture will help employees maintain trust even when managers take the wrong steps, accept new ideas, see obstacles as a challenge rather than a defeat, and be creative in approaching problems. To prevent cultural risk, we take basic steps to preserve corporate culture.

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