How to Create an Organizational Culture
The ability to create an organizational culture that helps both the people AND the business is essential for any company aiming to achieve sustainable success. A healthy corporate culture fosters employee engagement, promotes inclusivity, and thrives on open communication. An accountable workplace culture drives performance, productivity, and transparency. A strategically aligned culture ensures that the way work gets done aligns with the company’s strategic priorities.
The Importance of Corporate Culture
We define corporate culture as how and why things truly get done in an organization. Culture can be measured by understanding the way people think, behave, spend their time, and work. How leaders create an organizational culture matters. A recent Harvard Business School research report found that an effective culture can account for up to half of the differential in performance between organizations in the same industry. Our own organizational alignment research found that cultural factors account for 40% of the difference between high and low performing companies.
Steps to Create an Organizational Culture
Here are key steps to create an organizational culture that matters.
- Define Your Corporate Strategy
While most change management consulting experts start with corporate values, communications, and employee engagement when changing corporate culture, we believe that is a mistake. The foundation of any powerful workplace culture is the business strategy that it is supposed to enable. Before engaging in culture change work, ensure that your corporate strategy is clear enough, believable enough, and implementable enough in the eyes of employees to succeed.
Have you actively involved leadership and employees in defining your strategic vision, mission statement, corporate values, ideal target clients, unique value proposition, strategy success metrics, and strategic priorities?
If your business strategy is not as clear as it should be, consider a well-designed strategy retreat process that sets you and your team up for success before embarking on culture work. - Define the Necessary Culture
Once your strategy is clear enough, your next step is to define the culture required to best execute your business strategy. Once the executive team has defined the needed culture, it is time to get a reality check of how the rest of the organization perceives the current workplace culture in terms of health and alignment. Often, the best place to start is with a Cultural Alignment Assessment to identify the key cultural gaps that must be closed to get you where you want to go.
Have you identified whether your culture is helping or hindering your business strategy? - Ensure Leadership Commitment
We know from assessing organizational culture that leadership plays a pivotal role in shaping and maintaining how people think, behave, and work. Leaders must visibly and consistently model the core values and expected behaviors in their daily actions, decisions, and interactions. Then they must frequently communicate the importance of how culture ties to individual, team, and organizational success.
Are your leaders fully committed to consistently walking the talk? - Actively Engage Employees
An inclusive approach to culture creation involves employees at all levels – not just the executive team. Actively involve employees in culture change by soliciting input and feedback through surveys, focus groups, and open forums. Encouraging employee participation fosters a sense of ownership and belonging, making them more likely to embrace and promote the desired culture.
Are your employees an integral part of designing your desired workplace culture? - Recognize and Reward Alignment
Recognizing and rewarding behaviors that align with the company’s desired culture reinforces what matters most. Implement a recognition program that highlights employees who exemplify the organization’s desired values, attitudes, beliefs, and behaviors. This not only boosts morale but also serves as a powerful motivator for others to follow suit.
Do your rewards and recognition programs positively reinforce cultural alignment? - Monitor and Adapt
Organizational culture is not static; it evolves over time. And when strategies change, cultures must change accordingly. Regularly assess the culture through surveys, feedback, and performance metrics. Identify areas for improvement and be willing to adapt. Flexibility and responsiveness to changing circumstances and employee needs are key to maintaining a vibrant culture.
Are you keeping a pulse on your corporate culture?
The Bottom Line
The ability to create an organizational culture requires a strategic and inclusive approach. By defining the culture required to achieve your strategic direction and engaging employees in the process, leaders can build a high performing culture that drives both people AND business success. Just make sure that you continuously monitor and adapt to ensure your culture remains relevant and effective in getting you to where you want to go.
To learn more about how to create an organizational culture, download The 3 Levels of a High Performance Culture that Leaders Must Get Right
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