Why company culture is a pillar of corporate strategy

Imagine getting to work on a Monday morning with a busy week ahead of you. You turn on your laptop, go and grab a coffee while it’s loading up. But when you return to your desk, you see the blue screen of death.

The laptop is frozen and you can’t do any of your work as the operating system (OS) has crashed. Without an operating system, your laptop can’t function.

But it’s not just your computer that needs a Windows or iOS, businesses need an operating system of their own to function. This OS is company culture. The invisible lifeblood of the company, that nurtures, motivates and inspires employees. And without a positive workplace culture, your business, like that broken laptop, can grind to a halt.

Company culture is not just a nice to have, it’s a must to have. The evidence is there. A strong organisational culture drives positive results across the spectrum of business metrics. Your culture is directly linked to sustained organisational success, however you measure it.

In addition, customers have never had so much choice and such high expectations. Meaning the lens has turned toward customer retention and lifetime value. Success in this environment demands empowered employees focused on delivering excellence in all aspects of the customer experience.

Employee retention

If the office is a hostile and unfriendly environment, people won’t enjoy coming to work. And why would they if they feel as though they can’t speak to anyone and if they do, they’ll get into trouble.

Having a low employee churn rate saves businesses time and money, as the hiring process is often very time and money intensive once you consider training and recruitment. Especially with many industries facing crippling skills crisis – from tech to engineering. But positive company culture isn’t about free beer and ping pong tables (although I’m sure people wouldn’t be annoyed about that), it’s about personal development, and ensuring that the best employees remain engaged and interested. This includes setting out a clear and exciting career path for them and making them feel genuinely valued.

Motivation and productivity According to the Hawthorne Theory, the most important factor that influences worker productivity is relationships. Relationships between managers and employees need to be supportive and motivating, as motivation is directly linked to productivity. That’s a huge piece of the culture puzzle. In Maslow’s hierarchy of needs, motivational theory determines that positive human relations affect whether an employee’s safety, physiological needs and self-esteem are being met. Individuals are more likely to produce quality results when they are treated with respect and are made to feel as though they are being recognised for making a positive contribution to the company’s success. For example, an employee is not likely to produce their best work if they never receive any positive or motivational feedback.

As a business owner, making productivity gains is obviously hugely financially incentivising. And building and maintaining these relationships with employees often goes a long way. In fact, 60% of SME leaders believe positive workplace culture will drive better levels of customer service and satisfaction, 49% expected to see more ideas and innovation coming from their employees and 55% anticipated improved employee performance and – crucially – productivity.

Nurturing creativity

Creativity is at the heart of most businesses. Whether it’s thinking up the next big invention or thinking on your feet around how to solve a problem – they are all important. And employees’ creativity is often dependent on their ability to communicate with colleagues to share ideas and bounce them off one another. Without quality workplace relationships, employees are less likely to be able to develop and share the solutions that a business needs to survive.

For instance, if you have a ‘blame and culture’, it could deter people from speaking up in meetings or putting ideas forward. Mercedes’ Formula 1 boss, Toto Wolf, often praises the ‘no-fear’ culture imbedded in Mercedes as a key driver for its fifth successive constructors’ championship.

Relationships and culture within an organisation clearly have a huge positive impact on businesses. It improves employee retention, productivity, and creativity. And why just like any OS, it shouldn’t be an afterthought, but something that is installed, invested and maintained right from the get-go.

Jonathan Richards

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