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What Is Company Culture?

December 12, 2019
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We know it when we see it — but what is company culture, actually? Company culture refers to the values, beliefs, and attitudes that serve as guiding principles for everyone in an organization.

There’s a reason why millennials say that company culture is one of the most important things they consider when looking for jobs. When you get it right, employees can’t wait to show up and contribute. They’re quick to help colleagues and eager to come up with new ideas.

Components of a Great Culture

According to the Harvard Business Review, company culture is made up of six components:

  1. Vision. What does your company’s future look like? When organizations map where they want to be in five or ten years, that has a positive impact on your company culture. Netflix co-founder Patty McCord prefers looking at her company’s future in six-month increments.

  2. Values. Behind every great business is a set of inspiring company values. These should feel authentic and play a role in decision-making throughout the company. After realizing his company’s values were misaligned, Twilio CEO Jeff Lawson reworked them and created a process that startups can use to create their own.

  3. Practices. In other words, walk the walk. If your company says it “always puts customers first,” you actually need to put customers first. For example, Zappos prides itself on its customer service, and for good reason: A customer service agent once spent 10 hours on the phone with a single customer.

  4. People. People and culture go hand in hand. Companies that prioritize job candidates’ culture fit experience 30 percent less turnover. Arthrex, a medical device company, invests in employees’ well-being by offering tuition reimbursement — resulting in only a 5 percent voluntary employee churn rate.

  5. Narrative. What’s your story? Your company’s narrative helps shape your culture. If your business is all about team-building, for example, populate your Instagram page with candid shots from the internal events you have throughout the year. Check out Hootsuite’s Instagram for example.

  6. Place. Even your physical space can influence company culture. Take inspiration from Amazon’s “biospheres” in Seattle to Apple Park. Mark Zuckerberg takes candidates for walks on Facebook’s campus to convince them to work for his company. Create an environment that will inspire people to feel welcome and contribute.

Building a Great Company Culture

If you want your business to stay competitive, you’ll need to foster an enjoyable and supportive culture that people feel connected to. If you don’t play a role in shaping culture, it might be difficult to change what  sprouts up organically. 

The good news? If you start early, it’s completely possible to influence and shape your company culture. 

  1. Involve everyone. Everybody, from entry-level employees to the C-suite, needs to buy into your company culture for it to feel authentic. New hires tend to look to their peers to understand company norms and culture. It’s critical to understand that to shift your culture, you have to do something that aligns with all team members. Case in point? Google’s famous “20 percent time” program allows employees to spend one day a week pursuing their own projects and ideas.

  2. Leaders need to live and breathe culture. Leading by example is the easiest way for managers and executives to get everyone on board. Following a 2008 launch failure, SpaceX CEO Elon Musk gave an emotional speech, proclaiming how determined he was to succeed and how hard he was prepared to work. The speech inspired his entire team to keep moving forward.

  3. Hire for the culture you want. Company culture is influenced by people. Don’t forget to carefully weigh culture fit during the recruiting process. If you want a more positive culture, hire more positive people. Learning a whole new attitude is more difficult. Uber, for example, has been criticized for its lack of diversity. To address the problem, the company announced it was determined hire more women to reflect the company’s commitment to progressive values.

  4. Focus on the team. In strong company cultures, everybody — from the legal department to marketing — works together to reach a common goal. Never forget that you are in it together. Celebrate everyone’s contributions and give employees all the support you can. Lattice's praise tool encourages the celebration of colleagues' achievements, paying dividends in terms of team spirit and business success.

Once you’ve built a great company culture, it’ll be easier to compete for talent. Companies with great cultures never have trouble finding talented employees to work for them. Not only will existing employees refer your company to their friends, but applicants will also come organically based on reputation alone. For example, more than 2 million people apply to work at Google per year — largely because of its workplace culture and employer brand.

On the other hand, companies with toxic company cultures have a hard time attracting or retaining talent. In the age of Glassdoor, it can be difficult for companies with bad cultures to fill positions.

Taking your business to the next level starts with fostering a company culture that inspires managers and employees to reach their full potential. To see how Asana built one of Silicon Valley’s leading cultures, watch this video.