Business Performance Improvement and Company Culture


Company culture is one of the keystones of business performance improvement. Culture affects every facet of a business, from the way in which employees interact with management to the standards upheld by various departments. Company culture can make or break your business.

It is surprising how many companies have not yet adopted measures that will reshape their culture. Understanding how much you can change your business’s operations with attention to company culture, you will be able to improve your bottom line and make employees proud to work for your company. You will also make stakeholders happier with your business’s results, encouraging better relationships with the business community as a whole.

What is Company Culture?

Former MIT professor E.H. Schein defined culture as follows: “The set of shared, taken-for-granted implicit assumptions that a group holds and that determines how it perceives, thinks about, and reacts to its various environments.”

Company culture affects every facet of the way the business operates. From how employees are treated to the care given to customer service, the actions taken by employees at all levels of the company play into company culture.

Companies that have enjoyed long-term success are more likely to have an improved culture. This culture needs to change along with the times, or the company could be left behind the competition. 

Analyzing Corporate Culture

In 1992, professors John Kotter and James Heskett completed a research project detailing the corporate culture of over 200 companies. This study analyzed how each company’s culture affected its long-term performance. Their book, Corporate Culture and Performance, argued that a strong corporate culture facilitates adaptation to a changing business landscape. Strong corporate cultures are also associated with better financial results.

Corporate cultures that highly value customers, employees, and owners encourage leadership from everyone associated with the company. If a customer has changing needs, a strong corporate culture encourages people to change their practices. Change can come from any level of the organization if employees are empowered to make it.

Benefits of Strong Corporate Culture for Employees

Employees at all levels benefit from an improved company culture. When a company chooses to focus on improving the way it does business, it makes sure that employees are respected for their important contributions. It ensures that employees’ workflow is manageable and that they are recognized for their work. It also applies to human resources issues like compensation and benefits. Strong corporate culture makes employees happier, and happy employees work harder.

Corporate Culture and Profitability

Enhanced company culture can also affect profitability. Company culture can involve streamlining processes to make it easier for employees to do their jobs. This streamlining can lead to higher profits.

Understanding how corporate culture affects the bottom line also applies to issues like hiring and retaining employees. Employee turnover is costly and time-consuming. When employees’ skills and contributions are truly valued, they will be less likely to search for employment elsewhere. Culture can also help to attract high-quality workers for open positions.

Encouraging Personal Investment

A company with a quality culture will value each individual’s contributions. When people feel that they are valued, they are more likely to put extra effort into their work. A good company culture encourages everyone to be invested in their employer’s results, bringing pride when goals are met. If employees are not personally engaged in the company’s success, it will be difficult to motivate them to work harder for better results.

Attracting Better Employees

Changes to company culture can bring the business a better reputation in the community. This improved reputation can serve to attract better applicants for new job postings. When workers are deciding where to apply, they take company culture into account along with more tangible items like salary and benefits.

Economic Performance

Finally, economic performance is one of the largest benefits of improving company culture. Companies outperform their competitors when their culture emphasizes the needs of customers, investors, and employees. The culture also needs to change to keep up with developing conditions in the economy and in the industry.

Company Culture Goes Beyond Perks

Many companies like Google are known for their company culture. However, not every company needs to give the range of perks offered by companies like Google to enhance its culture. A fundamental change in how employees and executives interact is at the core of company culture. When employees are respected and results are valued highly, company culture will be able to transform a business and result in better outcomes for everyone.

Enjoying the Benefits of Improved Company Culture

When businesses take the time to sit down and decide on the principles of their culture, they will be able to take advantage of improved conditions. Going beyond a simple buzzword, company culture can transform how a business operates. Culture should be a top priority of today’s business leaders.