The importance of company culture at the enterprise level
Company culture develops organically in small startups where every employee fits in someone’s garage, but what if you’re part of a global enterprise with offices around the world, and your employees number in the tens of thousands?
At companies like these, getting everyone aligned on culture may feel like a Herculean task – but it’s worth doing. Why is culture so important in enterprise workplaces? Forrester data shows that investing in culture positively impacts both employee engagement and company revenue.
A positive workplace culture makes a difference, especially in large organizations. In enterprise companies, individual employees may sometimes feel like they’re just cogs in a machine or numbers on a spreadsheet. By continuously investing in your organizational culture, you create a work environment where people feel appreciated, empowered, and engaged.
What defines a thriving workplace culture?
While the specifics of what a strong culture looks like vary from company to company based on a complex web of factors, there are some common themes among nearly all organizations with a healthy culture. Using these three elements as a barometer, you can gauge how your enterprise is doing and determine if investing in culture could benefit your company.
Open and honest communication: The foundation of trust
Organizations with a healthy culture foster good communication. Employees feel comfortable expressing ideas and offering feedback, and they’re able to handle the inevitable workplace conflicts with tact and respect for one another. A healthy culture encourages work-life balance and employee wellbeing.
On the other hand, if the culture is weak or toxic, employees may be reluctant to speak up, particularly about conflicts or concerns. In these work environments, there is often the unspoken feeling that nobody cares what employees have to say and that complaints will go unheard or be outright ignored.
Accountability: Encouraging ownership and responsibility
A positive workplace culture encourages accountability – people take responsibility for their successes and their failures. Employees are willing and able to acknowledge where they have room for growth. They listen to constructive feedback and seize professional development opportunities, because they recognize that their work contributes to the company’s success. Instead of feeling competitive with other employees, they are quick to share credit and point out when someone else has contributed to a team effort.
In a toxic workplace, however, people are more likely to look out for themselves. They may attempt to pass the blame for mistakes to others and respond poorly to feedback. Individuals may try to claim full credit for wins and successes, rather than sharing the praise or rewards with peers.
Inclusivity and fairness: Creating an equitable workplace
In a positive work environment, people are treated as people – regardless of race or ethnicity, age, gender, job title, or other external factors. Everyone has a voice, and leaders listen to – and act on – employee feedback. Everyone is treated as if they have something valuable to offer. Employee engagement thrives.
Contrast that with a hostile work environment, where favoritism is rampant and the voices of junior employees may be ignored, often to the company's detriment. This builds an atmosphere of jealousy and distrust, which can quickly undermine the company’s diversity, equity, and inclusion efforts. It can also lead to turnover of some of your best employees if they start to feel their talents would be more appreciated elsewhere.
Why investing in enterprise workplace culture drives success
By putting culture first, organizations can scale sustainably, unlock high levels of performance and engagement, and meaningfully motivate and retain their talent.
Data has shown that a positive workplace culture is associated with:
- Better business performance: A FTSE Russell study found that companies that make the Fortune 100 Best Companies to Work For® list outperform the market by a factor of 3.68.
- Higher stock prices: Culture Amp’s people scientists have found that investing in culture and employee experience is positively associated with higher company stock prices.
- Lower turnover: SHRM reports that workers in positive work environments are almost four times more likely to stay with their current employer.
- Improved employee engagement. Employee engagement is higher when employees understand and feel in sync with the company’s beliefs, behaviors, and priorities. As a matter of fact, one study found that “companies with a robust culture have up to 72% higher employee engagement than those whose cultures are misaligned or need improvement.”
Furthermore, in enterprise companies, individual teams often develop their own strong cultures. This is a natural and beneficial process. However, when those teams inevitably need to collaborate or even swap workers, the culture clash may be stark and disruptive.
Fostering a company-wide culture unites teams around the same mission and principles. When everyone in an organization is aligned, collaboration becomes more accessible and more productive, reducing the potential for culture clashes among employees.
How to build a strong company culture from the ground up
To create a stand-out culture at an enterprise company, follow these three guidelines:
1. Conduct employee surveys: Measure sentiment and identify gaps
One of the best ways to understand the employee experience and get your finger on the pulse of current company culture is to conduct an employee survey. It’s important to note that when measuring culture, you don’t want to survey satisfaction. Instead, focus the survey on engagement.
Employee engagement is the level of enthusiasm and connection people have with their organization. Employees may not necessarily be satisfied with everything about their work environment (hours, pay, the brand of coffee in the breakroom), but they can still be engaged – and ultimately, engagement is what drives results.
Engagement levels can be a good indicator of how your current company culture affects your staff. Low engagement levels may suggest that people feel unmotivated and disconnected from the work they do every day, and the culture at your company could be a significant contributing factor.
You can’t manage what you can’t measure
2. Define core values: Align your culture with the company’s vision
In addition to conducting an employee survey, take some time to define the culture you want to build in your organization. What do you picture when you think of your ideal company culture? Get that down in writing, and then communicate it to your employees.
By starting this process higher up in the company, you can ensure that smaller subcultures across different teams and departments remain relatively consistent with your vision. Although a huge enterprise with offices worldwide will likely never have a completely uniform culture across every single team, it’s certainly possible to get close.
How do you define culture? Start with these questions:
- Why does your company exist? What is your core mission?
- What do you consider to be the core values of your company?
- What are your strategic priorities? Where’s the focus currently?
Questions like these can help you create a broad cultural definition. Once you’ve spelled it out and shared it widely, the rest will come easier.
3. Reinforce culture in daily interactions: Meetings, feedback loops, and leadership buy-in
Meetings sometimes get a bad rap, but they remain a critical part of operations for many (if not most) companies. When you have several large departments working in tandem, meetings are essential. They can also be a fantastic opportunity to demonstrate and reinforce the company culture your organization is working to build.
First, ensure that your meetings reflect the cultural values you want to instill. For example, if transparent communication is a key value, look to see if it’s being brought into the meeting room. If not, you've got some changes to make.
Next, look for ways to build your desired cultural values into the flow of meetings. To use the transparency example again, consider adding meeting segments where attendees are encouraged to ask questions or offer feedback on what was discussed.
How to measure and track company culture improvements
While company culture can’t be directly measured, you can use employee surveys to help you understand whether your cultural practices are successful or not. One particularly useful survey for this is an employee engagement survey.
By asking the right engagement survey questions, you can assess whether or not:
- Employees are united around a common set of priorities and beliefs
- Individual goals are aligned with organizational goals
- Employees feel like they can collectively work towards achieving those goals
If scores in these areas are low, it signals that some aspects of your culture may need improvement. Meanwhile, high scores in these areas suggest that you have a strong, positive culture.
Analyzing turnover rates and employee sentiment
The culture at your company affects employee retention. According to SHRM, 57% of employees who rate their organizational culture poorly say they are actively or soon will be looking for another job, a statistic that should make HR leaders sit up and take notice. Employee engagement surveys are a great way to better understand your turnover risks.
For example, suppose your employee engagement surveys show that employees are less satisfied with their career development opportunities (reflected in lower survey scores) than they were in the past. People analytics can analyze this employee sentiment in the context of other trends, such as a rise in absenteeism within the same group. This helps HR teams identify patterns and enables quick and informed action.
Companies that get culture right: Lessons from top workplaces
Successful enterprise companies understand what makes their organization unique and ensure these differences permeate. Below are two examples of enterprises that have seen substantial results from building strong cultures that reflect their unique employees, values, and business.
NASCAR: Measure the alignment between culture and behavior
The experience NASCAR provides, both on the track and off, is central to its success as an organization. Back in 2020, as the company prepared for a merger with International Speedway Corp., the company realized it needed to bring the rich cultures of two legacy organizations together in a cohesive, data-driven, and succinct way.
Insights from employee engagement surveys inspired NASCAR to roll out targeted initiatives across three pillars: Learning and development (L&D) opportunities, employee recognition initiatives, and benefits and wellness offerings. Through these efforts, NASCAR addressed immediate priorities and set the stage for a lasting cultural transformation at the newly merged organization. In particular, the organization saw a 4-point increase in favorability, above Culture Amp's industry benchmark, which represents a significant uptick in employee satisfaction and perception.
John Ferguson, Chief Human Resources Officer at NASCAR, shares:
"I want to emphasize the boost in credibility we've seen. For us, data is vital, particularly when we're pushing for policy changes. Being able to point to specific feedback and scores from the engagement survey strengthens our case. From that perspective, the insights we gathered through Culture Amp have absolutely been key in shaping our decisions and actions."
On: Focus on cultural consistency
On, a Swiss sportswear brand, upholds the principle of peak performance in both its operations and its sportswear. The team at On turned to Culture Amp for help evolving its strategic D&I framework as the company experienced rapid growth across the globe.
On’s goal was to continue creating a positive workplace culture where every employee – regardless of geographic or cultural differences – feels valued, heard, and included, and to extend these principles to the diverse communities On reaches worldwide. Through annual engagement surveys and data analysis, the On team identified the most important areas for growth and measured the impact of its various initiatives.
As a result of their intentional, strategic effort, On effectively embedded D&I into its culture and ethos while acknowledging that education and change is an ongoing endeavor. This led to 83% of employees believing their managers promote an inclusive team environment and 83% of employees agreeing they can be their authentic selves at work.
Culture as a competitive advantage: How to sustain it long-term
With workers expecting more than ever from the companies they work for, leaders can’t overlook the importance of a positive workplace culture. It’s a critical factor in creating an enticing, high-performing workplace that engages and retains employees.
Whether your organization consists of 10 employees or 10,000, it’s critical to understand the impact of investing in culture. Transforming culture at the enterprise level takes time and requires serious effort, but it can be done, and the results are worth it.
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