What Makes a Great Company Culture (and Why It Matters)
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If the ongoing “Great Resignation” has taught us anything since hundreds of workers began fleeing en masse in early 2021, company culture matters most.
According to a survey by FlexJobs, 25% of employees quit their roles in the six months leading up to March 2022 due to a toxic workplace. Unfortunately, many managers and entrepreneurs have a distorted view of company culture. When we define “culture”, we can better identify what it is based on and what it doesn’t.
Company Culture is a set of shared values and beliefs that promote ideation and growth. It is not dependent on material perks such as free coffee or background music at work.
A positive work environment promotes work/life balance, makes employees feel like they are part of a larger community, and encourages them to be their best selves. It can not only prevent high turnover rates, but also increase productivity and foster innovation. These factors make startups more competitive.
Related: Company Culture Is Everything
How to derive a winning company culture
Your actions as a founder directly affect your company as an entire, whether you are aware of it or not. Even if your culture is not worthy of much attention, it is a crucial component of your business that you should not ignore.
To help you understand where your organization is on the culture spectrum, here are some ways I can help you distinguish the good from the evil.
Positive company culture traits
- Low turnover and opportunity for growth
- Transparent and responsive management
- Recognition of success and achievements
- Healthy work-life balance among employees
Negative company culture traits
- High turnover and a professional ceiling
- Lack of clarity and direction from management
- Failure to acknowledge and reward good work
- Employee alliances and gossip regarding others
If you aren’t sure where to begin to create a positive company culture, these are some steps to consider.
1. Create the right team
To begin, a startup’s culture will ultimately be shaped by its founder and his or her vision.
As someone who has scaled high-growth ventures in many domains, I have always prioritized hiring people with the same values and beliefs. It is crucial to find the right cultural fit for a candidate in the hiring process. Your friends will reflect your business.
Creating an inclusive community of people who share similar values can help you build stronger social bonds within the organization which will result in longer employment and a more welcoming environment. Anyone who has ever worked in any job knows that one of the greatest feelings is to be able call your coworkers friends.
2. Create incentives for success
Incentives drive human behavior in a primitive and social way. If you have the right motivators, your startup can reach great heights.
Personal or professional growth is one of the most important outcomes an employee can achieve in their job. Businesses can maximize their human capital by prioritizing education, training, and rewarding employees with higher wages for self-improvement.
Recognizing productive behavior and celebrating wins will only lead you to more of the same. It is easy to predict the direction of your company’s growth as a founder by identifying the ceiling that employees could reach. Do you allow them to grow? Or do you limit their growth?
3. Establish goals and expectations
As a founder, you must also implement appropriate incentives. It is your duty to set expectations for success.
Your mission as a startup is to be an innovator in the industry in which you operate. This goal, while lofty, is what attracts top talent and often inspires the best employees to rise to the occasion. By setting ambitious goals, founders can inspire their subordinates.
Goal setting also provides a platform for team alignment and allows you to hold others accountable for not meeting your targets. Your startup’s goals and expectations will determine its success.
When we think about toxic work environments, we often think about toxic leaders. To avoid toxic work environments, leaders at the top must live and breathe the core values they promote.
Trust is not magical. It is easy to build trust through positive reinforcement and action. Founders must ensure that there are open lines of communication with their employees and be transparent. Many times, employees have found it rewarding to be responsive and encourage informal dialogue.
They don’t have the obligation to share all of their personal details with their employees, but they must be authentic if they are to build trust within an organization.
5. Foster a work-life balance
Finally, every employee is responsible for their own personal life. It is crucial to allow for work-life balance by setting fair working hours and limiting the hours of all tasks.
Offering competitive wages, paid leave, and healthcare benefits will help you retain the best employees and strengthen your company’s status as a founder. Startups should focus on the perks that matter. These include perks that are long-lasting and not cheap.
In an early stage startup, the most common causes of failure are internal factors such as poor workplace culture. You can dramatically improve employee retention, recruitment, and productivity by reforming the culture of your company.
In a world dominated technology-driven, the most successful businesses place emphasis on talent over all else.
I’m a journalist who specializes in investigative reporting and writing. I have written for the New York Times and other publications.