Company culture is a shared set of values, beliefs, attitudes, and behaviors that define how employees interact and work with each other. Changing company culture involves revising these so that employees think and act differently in their work.
The importance of company culture cannot be understated. It sets the tone for everything an organization does and influences business strategy at every level. When done successfully, a change in company culture can have a wide-ranging impact on many factors impacting your organization’s bottom line, including employee morale, productivity, and absenteeism.
When Is Company Culture Change Needed?
Organizations may try to transform their company culture to:
- Address a toxic or negative culture
- Realign company culture with new organizational values
- Adapt to changes in an organization such as significant growth or new leadership
- Improve employee and, thus, organizational performance
- Reduce employee turnover
- Adapt after a merger or acquisition or organizational crisis
Unfortunately, it can be challenging to change company culture, especially if you’ve unwittingly allowed negative behaviors to become the norm.
The Benefits of a Company Culture Change
Effecting company culture change is not an easy task. It takes considerable amounts of both time and money to build employee buy-in and reset your company’s culture. But it can be worth it. A cultural change in an organization can help address underlying issues, differentiate your business, and navigate broader organizational change.
Here are some potential benefits of a change in company culture.
Better Employee Engagement & Productivity
Driving company culture change can make your company a more enjoyable place to work for your employees. Improving the work environment boosts employee morale and productivity, enabling them to become more engaged and motivated in their work.
According to 83% of executives responding to a Deloitte survey, having engaged and motivated employees is the top-ranked factor that contributes to a company’s success.
Increased Employee Retention
A toxic corporate culture is the top predictor of a company’s attrition rate and is 10 times more important in predicting employee turnover than compensation. By cultivating a positive company culture, you create an enjoyable work environment for your employees. This helps address issues with staff turnover and short staffing.
Attracting Talented Employees
Attracting high-quality talent is a constant challenge for any organization. You can change your company’s culture to ensure it stands out from competitor employers and attracts the best candidates. Company culture is a key factor in the recruitment process—77% of respondents in a recent Glassdoor survey consider a company’s culture before applying for a job there.
Pairing your reputation for an inclusive and positive culture with an attractive compensation package makes your organization a favorable place to work.
Address a Toxic Culture
In a toxic or negative workplace culture, your company’s productivity will sink. Unhappy employees can’t work to their full potential, and you may face legal issues if serious issues like racism or workplace bullying are occurring.
Indicators of a toxic workplace culture include burnout, unethical behavior, and an increase in employee turnover or absenteeism. By preemptively enacting company culture change, you can reduce the risk of toxic behaviors developing. As soon as you see problems arising, you should address them to ensure you maintain a positive workplace.
Challenges of Changing Company Culture
- Employee buy-in. If employees are resistant to a change in your company culture, it will be very hard to effect it. Long-term employees who are used to the existing culture may not be interested in changing the status quo. So it’s important to communicate with them and involve them in the process as much as possible.
- Timeframes. Changing company culture isn’t a quick fix. It’s a long-term process that requires strategic planning and company-wide support to put in place. You need to communicate this with employees, especially management, so they understand this and exercise patience.
- Lack of ownership. Culture change requires the involvement of the whole organization, not just HR. It can be challenging to motivate employees or departments to be part of the process when they have other priorities they view as more important.
How To Change Your Company Culture
To manage these challenges, it’s essential to develop a detailed strategy for changing your company culture.
Step 1: Review Your Core Values
First, review your company’s core values to ensure they accurately reflect where your company culture change will take the organization. Organizational culture is an expression of your core values so it’s essential it aligns with them, as well as your long-term vision. Well-articulated core values also help you communicate the reasons for your culture change to your employees.
To help you do this, survey your employees to understand the values they believe are present in the workplace or the values they would like to see. This process also highlights any mismatched values between different levels or departments that need to be addressed.
Step 2: Set New Company Culture Goals
Next, identify the direction you want your organization to take when it comes to company culture. A change in company culture should be a positive one and it’s important to set clear goals to guide it.
To do this, keep in mind your “why”—why is it necessary to make changes to your company culture? This will help you identify what needs to be addressed. For example, if you’re changing your company culture to address high rates of employee burnout and turnover, you could set goals related to the design of your workplace or allowing employees to work from home more.
Step 3: Create a Roadmap
Once you’ve considered the goals for your culture change, you need to identify the steps to take to achieve it. Assess where your company currently is compared to where you want it to be and break down the process into incremental steps with associated timeframes. This makes the cultural change process manageable and provides you with targets to measure its progress.
As part of this, consider how the changes will impact your employees and existing processes and how you intend to manage any issues that arise. It’s also important to get this step signed off by executive leadership if they’re not already involved in the design of it.
Step 4: Communicate With Your Employees
To effect positive change, it’s important to let your employees know about the planned change in company culture, how it affects them, and what’s expected of them. Involve them in the planning process. Collect feedback from them to help you shape your cultural change roadmap—employees are more likely to support a process they had input on. Also keep employees updated as it’s implemented.
For consistency, you can also create a company culture deck that sets out your core values, vision, and culture. Make sure you provide this to new employees during onboarding, as well as your existing employees.
Step 5: Deal With Challenges
As we’ve discussed, challenges will arise when introducing a new company culture. It can be difficult to build employee buy-in, takes a long time to do properly, and requires organization-wide support and participation. Aside from these, there can be unforeseen issues specific to your organization or sector that also come up.
To overcome some of these obstacles, it’s essential to involve every employee in the process and communicate openly and transparently with them. Leadership also plays an important role in transforming organizational culture. They should actively show employees that cultural change is important and lead by example in supporting it and following the roadmap.
Step 6: Evaluate & Revise
A company culture change plan alone isn’t enough to effect deep cultural change in an organization. You need to also check its success against the roadmap you develop. If you’re failing to meet these goals within the set timeframes, it’s time to take a step back and identify any changes you need to make.
Some innovative companies are starting to play with the idea of a culture committee—a selection of employees from different departments who are in charge of maintaining and developing the company culture. Setting up something like this can be a great way to keep an eye on and support your company’s culture change.
A company culture change can have great benefits for your company, boosting productivity and making you more attractive to potential employees. But driving culture change isn’t always easy, and it can take some time and money to successfully introduce.
To start, ensure you have a clear plan that supports your company’s core values. Set goals and establish a timeline to achieve them. Involve your employees in the process and communicate to them why the change is necessary and what their role is in it. Over time, and with the support of the organization’s leadership, you should be able to effect real and positive cultural change within your organization.
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