How to Establish a Healthy Corporate Culture

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Digital Library > Building and Inspiring an Organization > Corporate culture"How to Establish a Healthy Corporate Culture"

Whether you planned it or not, your company has its own culture. By defining and strengthening it, you can increase employee morale and performance and build customer loyalty.

OVERVIEW [top]

Every workplace has its own distinct flavor, from its customer-service policies to its dress code. When developed properly, that corporate culture — the attitude and structure of your company — can attract and retain employees, improve your business, and build customer loyalty. While the strongest corporate culture feels organic, it actually must be created and actively nurtured by the CEO to provide the most rewards.

In this Quick-Read you will find:

  • How to assess your own corporate culture.
  • Steps to develop and nurture a strong corporate culture.

SOLUTION [top]

How to assess your existing corporate culture

When you evaluate your current corporate culture, look for the alignment between what you say you want, and what really exists.

  • Pay attention to the mission. What you notice and reward communicates your values more clearly than policy statements. If your mission statement touts providing excellent customer service, yet you penalize workers for spending time with customers, then at best your employees will see you as hypocritical. At worst they will follow your lead and say one thing but do another. Your corporate culture is in opposition to your ideals.

  • Evaluate office atmosphere. What are people wearing? Do employees punch a clock? Some controls thwart innovation, creativity, and communication while others enhance it. Assess your office atmosphere, and see if it reflects your corporate objectives.

  • Consider your leadership style. How do you manifest leadership style in your office? Do you delegate responsibility, or make the final decision on everything? Do you visit with employees in the hallways, or must they schedule an appointment to meet with you? Corporate culture is a direct result of leadership. Whether intentional or not, your company workers will reflect the strengths and flaws of your management.

  • Think about what makes some employees exemplars of the culture you'd like to see. What characteristics make a worker more likely to succeed and help your company prosper? Can you list them? Can any be integrated into the company mission, goals, and objectives?

Steps to develop a strong corporate culture

Once you've determined what your corporate culture is, you can nurture or adapt it to be closer to your mission, vision, and ultimate objectives.

  • Lay the groundwork. When interviewing potential new employees, talk to them about your values, philosophies, and leadership style. Ask them what they care about in and outside of work. Share the corporate vision and core values. And continue the practice with employees already on staff.

  • Model the culture you want to create. If you say creativity and communication are a priority, take time to talk to your employees, set up brainstorming lunches, reward new ideas. If you view your employees as the greatest asset, let them know it. Provide comprehensive benefits, flex time, incentives, support, and encouragement.

  • Don't force it. Define the corporate culture you want, and work on it. Setting a good example is necessary, but not sufficient. You have to convince others that they want the change too. Communicate the values you want to see your employees reflect. Communicate the benefits of the desired change. People have to learn and develop new habits. Corporate culture can't be mandated and shouldn't feel contrived.

  • Do the little things. Make sure your employees know they are valuable. Ask about their lives outside of work. Send birthday messages. Celebrate their on-the-job successes. Eat lunch with them. Show them that you have a life outside of work and can identify with other life challenges. If you want well-balanced employees, be a well-balanced boss.

  • Nurture the culture. Be consistent. Don't create an open-door policy if you don't want to listen when your employees come to you. If you offer flex-time, don't question every moment they're away. Communication and respect are key. If employees are unhappy, ask why and solicit their solutions. Evaluate the ways the culture is helping or harming workplace efficiency and employee morale. Stay true to your core values, and allow the culture to grow around them. This requires constant effort.

  • Let culture evolve. Keep your company's mission clear, but don't try to homogenize every office. Expect each office to develop its own subculture and style, based on the region, people, and work.

REAL-LIFE EXAMPLE [top]

"It wasn't autocratic. It started at the top and the bottom, and then we worked to make it successful at all levels," said Steven Taylor, former president of Brim Healthcare, which employed 22,000 people in hospitals and retirement centers throughout the country.

While each office had a separate culture, they all reflected the company's core values: that employees would be treated fairly and with respect, and that the company would provide its clients with the best care available.

Managers and employees discussed pay and benefits openly. The mission statement and vision statement were a collaborative effort and people shared their concerns. Employees were always part of the solution.

Under Taylor's management, the hiring process was extensive and reflected the corporate culture. Job candidates were told about the philosophy and importance of open dialogue. Candidates who weren't comfortable with the openness and didn't respect labor at all levels, didn't get hired.

Taylor also worked with a cultural anthropologist to identify the elements and office details that contributed to the culture and those that worked against it. Changes were made to be more congruent with the company vision. For instance, the dress code was changed to a more casual style to reflect the company's flexibility and willingness to listen to employees.

Taylor communicated with workers and established relationships. He walked the hallways of every office, talking with employees and working to maintain the openness that fueled the culture. It's a relationship that begins in the hiring process and never ends, Taylor said.

DO IT [top]

  1. Assess your corporate culture. What are people wearing? Who eats lunch in the cafeteria? What hours does your staff work? What do you know about their families and outside interests? The best way to determine the type of culture you want to create is to look at the one already established.

  2. Look for alignment. List your core values, and then list the areas in which your existing corporate culture is in alignment or inconsistent with those principles. If you tell your employees that their personal and professional well-being is a priority, yet you reward only the people who never miss work, then what you say and what you do are in opposition.

  3. Meet with your employees. Ask them how they define the corporate culture. Does it help or hinder office morale and efficiency?

  4. Make changes. Once you've identified problem practices, list five things you can do to adapt the culture accordingly. If you believe changes must be made toward fostering communication, start casual conversations with employees. Schedule brainstorming sessions where ideas are respected and appreciated. Start with one element that could improve to better reflect your core values and work to develop it.

  5. Establish an orientation program that socializes new employees into the desired culture. Don't just discuss details, such as housekeeping, work breaks, and how training and development are handled. Discuss your corporate history. Knowing about past heroes and villains, triumphs and disappointments, makes a new employee feel more like a team member and identify with the company. Ideas for establishing valuable corporate myths can be found in the Quick-Read "Communicating the Vision: Lead by Telling Stories."

  6. Promote qualified workers who exemplify the kind of corporate culture you want rather than hiring new managers from outside.

  7. Think about the effect on corporate culture before you outsource business operations, and try not to outsource functions important to your corporate personality.

RESOURCES [top]

Books

Practice What You Preach: What Managers Must Do To Create a High Achievement Culture, by David H. Maister (Free Press, 2001). Case studies, but not too academic. Chapters 20-23 provide checklists of desirable and undesirable cultural characteristics to look for and recommendations for improving the culture.


Internet Sites

Journal articles

"The Corporate Petri Dish," by Jennifer Lawton. Kauffman Center for Entrepreneurial Leadership.

"Entrepreneurial Culture: What They Do Teach You at the Fortune 500," by Rick Krska. Kauffman Center for Entrepreneurial Leadership.

"How Entrepreneurs Build Culture," by Ray Smilor. Kauffman Center for Entrepreneurial Leadership.

"Roll Out the Welcome Mat," by Ilan Mochari, Inc. (September 30, 1999).

"Three Cultures of Management: The Key to Organizational Learning," by Edgar H. Schein, MIT Sloan Management Review (Fall 1996).


Article Contributors

Writer: Polly Campbell

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