Updated: Jan 8
Back in 2014, the word “culture” was the most popular word (according to the Merriam Webster’s dictionary). In 2015, company culture was among the top content drivers for Forbes, Inc, and Entrepreneur. The last few years, it’s expanded into phrases like “cultural ecosystem,” “culture code,” and “cultural inclusion.”
According to the Business Dictionary, the simple definition of company culture is “the values and behaviors that contribute to the unique social and psychological environment of an organization.” A few of the most common words used to describe a healthy company culture are forward-thinking, dynamic, innovative, agile, visionary and transparent.
Whether it’s putting people over profits, adopting an “open to change” philosophy, prioritizing learning and collaboration, or building an organization with a growth mindset, a healthy company culture does more than create a pleasant work environment. It also helps attract and retain the kind of job candidates will help the organization grow and continue to succeed.
And yet, with all of the emphasis on company culture, it may be another addition to the growing list of top business buzzwords to imply a set of values that are not actually implemented or demonstrated. Culture is more than all-you-can-eat cereal bars, ping pong tables, and Frisbee Fridays. It isn’t what is written down in the employee handbook or posted on the wall in the break room.
Culture is not what people say about your company; it’s not even how people feel about your company. It’s how they feel about their work and the people with whom they do it with.
An organization’s culture encompasses the values, ethics, vision, behaviors and work environment that defines that company and impacts everything from public image to employee engagement and retention. Companies with a healthy culture have highly engaged employees, positive workplace morale, and collaborative team dynamics – all of which translates into extraordinary outcomes.
“Culture guides discretionary behavior and it picks up where the employee handbook leaves off. Culture tells us how to respond to an unprecedented service request. It tells us whether to risk telling our bosses about new ideas and whether to surface or hide problems. Employees make hundreds of decisions on their own every day and culture is the guide. Culture tells us what to do when the CEO isn’t in the room, which is most of the time.” - Anne Morris, HBR
Build your culture with intention; otherwise, it will build itself when you're not paying attention. If you really want to company culture to be more than a meaningless catchphrase or the latest HR initiative, consider seven elements that are essential for the kind of workplace environment that enables people to thrive rather than simply survive.
Moral Leadership: The most high-profile leaders are celebrated for their business acumen, innovation, and thought diversity. Names like Jeff Bezos, Elon Musk, Mark Zuckerberg, and Steve Jobs fall into the category of brilliant visionary leadership. But many of the most successful CEOs are NOT known for their moral leadership. In fact, all of the above named leaders been accused of putting profit above all else, including employee safety and well-being.
In a global economy, where the desire to win at all costs is pervasive, ethical lapses are equally as common. However, the role of ethics in business is receiving increased attention. Many leaders are striving to establish a practice of positive workplace ethics within their organizations and this is adding a new moral dimension to leadership. While ethics is a set of principles of right conduct, moral leadership is ethical decision making with the right moral values.
Despite the long list of benefits of moral leadership – everything from individual and team performance and increases in revenue and profitability, to perceptions of trust, employee engagement and acquiring and retaining the best workforce – there is a wealth of research showing that ethics and morality in the tenets of leadership is undervalued and not prioritized.
There are many theories about the most effective leadership – from authentic and transformational leadership to servant leadership to values-based leadership. More recently, as we shift toward putting people over profits and elevating humanity into the workplace, leadership has evolved to include a moral dimension.
Moral leadership involve leading people to a higher order or purpose and exemplifies ethics in key decision making. There is a public consensus that demonstrating ethical behavior as an organization is not just a nice-to-have; it’s a must-have.
Employee Engagement: Organizational leaders everywhere are looking for the secret sauce to employee engagement. In fact, according to recent surveys, more than 75% of leaders cite employee engagement and turnover as their primary concerns, and more than 80% believe that if they improve the employee experience, they will improve the customer experience which will improve the bottom line.
Engagement is how equipped, motivated and empowered employees are to contribute to something bigger than themselves. If employees feel that what they do matters and that it contributes to the success of the organization, they will work toward the common goal as a valued member of the tribe.
A simple and sincere gesture of gratitude is one of the easiest ways to have the greatest impact on company culture. And a simple “thank you” is one of the best ways to keep employees engaged and productive. Neuroscience explains what happens when someone acknowledges our efforts and thanks us for being a valued member of the community (e.g., dopamine, oxytocin, etc.). Brain-based research shows that the neurotransmitters released during expressions of gratitude actually help the brain decrease stress and increase happiness and well-being. Brain scans also show that these neurotransmitters facility activity in the prefrontal cortex – the part of the brain responsible for all the higher order thought processes.
The disengaged will stay for what they can get.
The engaged will stay for what they can give.
Psychological Safety: People will not invest themselves in a company if they do not feel a sense of psychological safety. Teams will not be successful if members don’t feel safe to take risks and be vulnerable in front of each other. Google conducted a massive two-year study and found that the highest-performing teams have one thing in common: psychological safety, the belief that you won’t be punished when you make a mistake. A wealth of studies show that psychological safety allows people to speak up, be creative, and take moderate risks without fear of reprisal – the types of behavior that lead to market breakthroughs.
Most of us experience a certain amount of reluctance to take risks that might fail or make us look incompetent. Although this kind of self-protection is human nature, it is detrimental to effective teamwork and innovation. On the flip side, the safer team members feel with one another, the more likely they are to admit mistakes, to collaborate, learn from one another, and generate new solutions or creative ideas – and ultimately more revenue.
The same neural activity that enabled our ancestors to avoid extinction explains why psychological safety is essential to success in the workplace. The brain processes an impossible to please boss, competitive coworker, or dismissive subordinate the same way it does a life-or-death threat. The alarm bell in the brain – the amygdala – activates the fight-or-flight response and hijacks the region of the brain responsible for higher level thought processes like impulse control, analytical reasoning, and problem-solving. Quite literally, it puts our thinking brain on pause to allocate all neural resources to deal with the threat. While that fight-or-flight reaction may save us in life-or-death situations, can sabotage the strategic, creative, innovative thinking needed in the workplace.
Learning and development: Traditionally, the veterans have been the mentors and the rookies have been expected to learn the ropes from them. Thanks to the Millennials, the explosion of information, and the constant disruptions in the market, the roles of teaching and learning within leading companies are shifting. An organization’s culture of learning, or lack thereof, has never been more significant.
In a nutshell, today’s leading companies want creative thinkers who can troubleshoot and solve problems together. They want people who know how to learn together. In order to actualize a collective ROI from every member of the organization, leaders must set high expectations for contributions and respect the reciprocity of a learning community regardless of where people sit on the org chart. Those companies that are able to grow their “division of labor” into a “division of learning” will realize the powerful fusion of the gray knowledge with the green knowledge instead of sacrificing one for the other.
In addition to solving problems more efficiently and growing the body of knowledge, employees will be more engaged and happier in the work they do for the company. According to the latest Society of Human Resource Management Employee Job Satisfaction and Engagement research report, 92% of those surveyed identified contribution of work to organizational goals as important to job satisfaction.
Employee Appreciation: We all want to know that what we do matters. Leaders can set the tone and expectation for a culture of gratitude. If they recognize employees’ efforts and show genuine appreciation for their contributions to the company, the result will be a ripple effect across the entire organization that will significantly influence the culture of the company and the job employees do for the customer.
According to recent research, 79 percent of employees who quit their jobs claim that a lack of appreciation was a major reason for leaving. 65 percent of Americans claimed they weren’t recognized a single time last year. And as the number of employee recognition and reward programs soar, more than 60 percent of employees indicate that they are more motivated knowing their work is valued and appreciated than by money.
Saying “thank you” to employees is not just polite, it is smart business and critical for employee engagement. It is perhaps the simplest, most impactful way to motivate them and inspire them to want to keep working at your company. In fact, many say that a personal “thank you” means more than other rewards, perks, or recognition programs. It costs nothing, and the rewards are HUGE!
Growth mindset. Any type of workplace environment—academic, business, nonprofits, and others—communicates cultural mindset through shared norms and values. In correlation with a growth or fixed mindset, cultures can be defined as those of genius or development.
A culture of genius is the view that brilliance is the critical ingredient for success. These companies focus on finding the “rock stars,” and people learn quickly to be smart or smarter than the next guy and there is little or no value placed on growth, learning, or effort. Genius creates value. When that image is threatened, employees would rather lie than admit to mistakes that would invalidate their value. Any opportunity for learning and self-correcting the system is sabotaged bythe system.
Employees in the culture of genius companies characterize the climate as inequitable, mistrusting and dishonest. They describe an environment of extreme competition and unethical behaviors such as “cheating, shortcuts, and cutting corners” and “hiding information and keeping secrets.” Many are worried about being called out for failing, so they stay in their comfort zones and avoid taking risks that could result in creativity and innovation. Employees who feel that innovation and hard work are only rewarded if they are successful are much more likely to play it safe and focus on the status quo.
Conversely, cultures of development value of collaborative learning and embody the ability to learn and grow with a focus on resilience . These are the companies that place a value on employees’ abilities to set high goals and take risks to reach them. Employees who describe their companies as having cultures of growth and development report greater levels of trust, a stronger commitment to the company, and stronger support for risk-taking, innovation, and creativity. They are more likely to feel a sense of ownership and commitment to the success of the company.
Perhaps the most significant difference is in what people said about initiative and change. In the genius cultures, people demonstrated a lack of initiative and an entrenched resistance to change. Those in cultures of development assumed ownership over making improvements and sought out how their role impacted the bigger picture.
Emotional contagion. Every organization has an emotional culture. People “catch” feelings from others through behavioral mimicry and changes in brain function. It’s called emotional contagion and it’s backed by a wealth of neuroscientific research. As employees collaborate with positive emotions, they actually change the chemistry of their brains by releasing neurotransmitters that facilitate activity in the prefrontal cortex – or the thinking brain.
Likewise, people who exude stress, frustration, or pessimism will spread those negative emotions to their coworkers resulting in the release of stress hormones that put the thinking brain on pause. Depending upon the level of intensity, both positive and negative emotions can be sticky enough to be passed along to the next interaction. Every employee – from the CEO to the receptionist to the custodian – has the power to cultivate specific emotions that impact the culture of the organization.
Challenge yourself every day to exemplify the culture in which you want to live, work, and play. -Melissa Hughes
Download this free ebook to learn more about how to create a culture of psychological safety in the virtual world.