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Why Company Culture is so Important for Employees

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Have you ever wondered what your organization’s company culture was? As a leader, manager, or member of your company’s Human Resources department, your perception of your organization’s culture may differ from the perception held by the majority of employees. According to multiyear research conducted by MIT Sloan School of Management, “data reveals that cultures vary widely in quality in the eyes of their employees.”

You know that your employees’ perception matters. After, if employee productivity is the lifeblood of an organization, employee perception is the heart: it’s what keeps employees engaged, encouraged, and productive—and what keeps everything else in the organization working in alignment. Measuring this perception can be tricky, but the experts at Peoplelytics are here to help.

In this article, we’ll dive into the details of company culture: what it is, why it’s so important to employees, and how you can steer your company’s culture in a direction that benefits your entire organizational body.

3 Key takeaways you need to know:
  • Company culture is a huge aspect to employees and whether they take a job and stay with your company. 
  • Understanding your organization’s culture requires soliciting open and honest feedback from employees.
  • By prioritizing employee satisfaction and engagement, organizations can create a culture that fosters productivity, innovation, and long-term success.
group of diverse employees socializing in a positive company culture

What is Company Culture?

“Company culture” is a hard concept to define, because, by its very nature, it differs between each organization. Harvard Business Review defines company culture as “the ways people in the organization behave and the attitudes and beliefs that inform those behaviors (i.e., ‘the way we do things around here’) — including formal, stated norms as well as implicit ways people work and interact.”

What makes each company’s culture unique (for better or for worse) can be difficult to pinpoint if you don’t have a good hold on your employee’s honest opinions and experiences.

What Makes a Company’s Culture?

According to the Society for Human Resources Management, while there is “no generally accepted definition of culture,” the concept of organizational culture encompasses many factors that may shift. Some of the factors that make up a company’s culture include:

  • Leadership styles
  • The behavior of leadership
  • Communication styles
  • Internal messaging
  • Transparency
  • Hiring, firing, and promotion practices
  • Healthcare and medical benefits
  • Attitudes toward paid time off, vacation, and sick days
  • Work-life balance
  • Opportunities for internal advancement
  • Training, learning, and development
  • Hierarchical structure (or lack thereof)
  • Corporate celebration and recognition methods
  • The personalities of the employees at the company
  • Clarity surrounding goals and expectations
  • In-office requirements and/or hybrid, or remote work permissions
  • Presentation and dress
  • HR and legal compliance
  • Office décor, amenities, and accessibility
  • Corporate events (on or off-site)
  • The emotions that employees are encouraged to express or suppress
  • The effectiveness of the organization’s internal structure

…And so much more!

Does Company Culture Matter to Employees?

The answer to whether company culture matters to employees is clear; data shows it’s a resounding and emphatic “Yes.”

77% of employees seek to understand an organization’s culture before applying for a job there.


If the employees weren’t impressed with the company’s culture, 73 percent of them indicated they “would not apply” for an open role within the organization.

Companies can get a lot of bang for their buck out of efforts to improve their culture. While salary, wages, and other benefits often go hand-in-hand with employees’ perception of an organization, a great culture can carry a great deal of weight. 56 percent of those surveyed in the Glassdoor survey indicated that a positive workplace culture was, in terms of overall job satisfaction, more important to them than salary.

To experts in the field of organizational psychology, these statistics make sense. According to Michael McCarthy, an instructor at Harvard DCE Professional & Executive Development and host of the “Happy at Work” podcast, while a job “may be in your field, the commute may be great, or the pay package may be exactly what you are asking for — or more — but that isn’t good enough.

“It’s critical, McCarthy says, “that the organization is a good fit with your values and offers a healthy workplace environment with effective leadership that will support and nurture you on your career journey.”

What do Employees Look for in a Company Culture?

Every employee looks to different factors when forming their perception of a company’s culture—because at our core, different things matter to each of us, and at different levels.

In order to answer the question of “what employees look for in a company culture” on a broader scale, researchers at MIT’s Sloan School of Management attempted to summarize the most important cultural factors among surveyed employees. They analyzed a total of 1.4 million reviews of employers as submitted by workers, and patterns began to emerge. Here are the ten elements they found mattered most to employees:

1. Whether or not they felt respected

Respect is the single most important factor, culturally, to employees. Interestingly, if your employees don’t feel respected, you may not know it. Across many industries, including regional banking, apparel retail, fast food, and telecommunications services, research shows that employees feel negatively about the respect they receipt, and yet, very infrequently bring up the topic.

2. Whether they felt their leaders were supportive, accommodating, and encouraging

If your employees don’t feel supported, accommodated, or encouraged, their motivation will drop—as will their perception of the organization and the work they do within it.

3. Whether they believed leaders’ actions were consistent with their values

Employees put a lot of faith in their bosses, from their direct managers and supervisors to their organization’s C-suite. Whether employees feel their bosses “walk the walk” matters significantly culture-wise.

4. How “toxic” they felt management was

The actions of each manager within your organization matters. If abuse, disrespect, favoritism, and other poor behavior must be “put up with” by the manager’s direct reports, that behavior will reflect negatively on an employee’s overall perception of their employer.

5. The level of unethical behavior they witnessed

Companies often include references to integrity or ethics in their mission statement or cultural material. But if employees perceive that unethical behavior is taking place, they may look to leave.

6. The quality of employer-provided benefits they received

Research shows that “when it comes to predicting a company’s culture score, benefits are more than twice as important as compensation.”

7. The workplace perks and amenities they had access to

Perks and amenities bring joy to employees that is both lasting and contagious. Whether you incorporate free coffee, lunches, or team-building exercises, great perks are universally appreciated.

8. Opportunities for learning and development

Time has shown that employees invest back into companies that invest in them. Boosting opportunities for learning, development, and training within your organization is a great way to improve company culture and retention rates.

9. Their perception of job security

If employees are afraid of layoffs and reductions in force affecting them, their department, or their coworkers, the overall perception of your organizational culture will suffer.

10. The quality (and frequency) of reorganization

Employees have little control over mergers, acquisitions, and divestments. How smoothly these changes go for them will inform their perception of overall company culture. Often, culture perceptions shift greatly after reorganization activity.

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Can you Change your Company Culture?

The important thing to remember about your company culture is this: it is not static. For better or for worse, it can change rapidly. It can evolve (or devolve) over time as new employees are hired, as leadership attitudes and actions shift, and as movement happens within other spheres.

A change in your company’s culture is something that can occur organically, without much intention from any particular group. Or, it can happen as the result of focused efforts from people within the organization who care about culture and employees’ perception of their workplace.

In order to change your company culture, you have to first understand what your culture is—and what it’s perceived to be—by the workforce as a whole, on a departmental or team level, and finally, on an individual level for each employee.

How to Understand Your Current Company Culture

Understanding a company culture requires employers to solicit open and honest feedback from employees at all levels. You can use eNPS (Employee Net Promoter Score) surveys and company culture surveys to provide valuable insights into prevailing norms, perceptions, and areas for improvement.

How You Can Use Surveys to Transform Your Company Culture

Exploring the use of eNPS and company culture surveys to gather feedback is a key way for companies to rely on powerful digital tools for gauging employee sentiment and driving cultural change. These surveys can allow employees to express their opinions anonymously. In turn, you’ll collect candid feedback that you can use to initiate targeted interventions on an organization-wide, departmental, or even individual level.

The best survey software can turn the data you gather into filterable, easily digestible, and ultimately actionable insights in the form of segmentation-specific charts and graphs. It will also be able to deliver recommended actions based on the data and feedback you receive. Surveys built on the Peoplelytics platform are fully customizable. The balance you’ll find between our suggested insights and your tailored questions is up to you.

Take the First Step Toward Improving Your Company Culture. Start Gathering Insights Today.

Studies have found that “culture is the single best predictor of employee satisfaction, ahead of compensation and work-life balance.” Are you ready to measure, understand, and transform your culture? The team at Peoplelytics can help. Schedule a live demo with our experts today.

Let’s Recap

In conclusion, understanding and nurturing your company’s culture is paramount for sustained success and employee satisfaction. As highlighted throughout this article, a positive company culture not only attracts top talent but also fosters employee engagement and productivity. It’s clear that employees place a significant emphasis on factors such as respect, leadership support, alignment with values, and opportunities for growth and development when evaluating their workplace satisfaction.

Furthermore, the ability to adapt and evolve your company culture is essential in today’s dynamic business landscape. Whether through organic shifts or intentional interventions, organizations have the power to shape their culture to better align with employee needs and organizational goals.

Utilizing tools like eNPS surveys and company culture assessments can provide invaluable insights into the current state of your organization’s culture and guide targeted efforts for improvement. By prioritizing employee feedback and implementing actionable strategies, organizations can create a workplace environment where employees feel valued, motivated, and empowered to thrive.

Ultimately, investing in your company’s culture isn’t just about attracting and retaining talent—it’s about building a foundation for long-term success and creating a workplace where everyone can flourish.

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