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What Is Corporate Culture? Definition and Guide

what is corporate culture

When someone asks an employee what a particular company is like to work for, the answer they get is usually a good summary of that company’s corporate culture. What the work environment is like, how employees relate to each other, how strict – or lax – the rules are, how communication occurs, what the organization’s priorities are, and how stressful the atmosphere is like are all aspects of a company’s culture.

A good, or positive, corporate culture creates loyal fans out of both employees and customers. That’s good for business. So it’s probably no surprise that research indicates that a positive corporate culture is a source of competitive advantage.

So how do you build a positive culture?

Creating a corporate culture

A company’s culture is shaped by a number of tangible and intangible components that together create an environment that is conducive, or not, to good work. Here are some of the most-often-cited facets:

Values. Whatever it is that a company states is its driving force – its business core values – will affect what its employees focus on. The culture of a company that values caring will be different from one that values, say, creativity or speed or precision. One isn’t necessarily better than another, it simply will impact the types of employees that are hired and what everyone is working toward.

Employees. To build a corporate culture that matches what leaders want the business to be known for, you have to hire carefully. Each and every employee needs to match the culture and the company’s values. Companies with the most desirable corporate cultures invest a lot of time recruiting and interviewing potential new hires because they recognize how essential each person is to supporting the culture.

Environment. Where employees have to work will have a major impact on the organization’s culture and branding. Pack everyone in a tight space like sardines, with little light and few creature comforts and you will likely build a culture centered on negativity and complaints. Whereas a space that is open and airy, with ample workspace, will foster positive feelings and lower stress. Workspace matter.

Actions. How a company demonstrates its values and priorities also shapes its corporate culture. Do its actions align with its values, or not? Companies that put customer satisfaction as its highest priority should have processes and procedures that ensure customers are delighted with its dealings with the company. Satisfaction guarantees, no hassle refunds, and no expiration dates on returns could be policies that support such a value.

Opportunities for bonding. Companies that set aside time outside of work to socialize and get to know each other create opportunities for more fulfilling personal relationships to form. Some companies have annual off-site meetings that bring together all employees to talk about what’s going well and what’s not. Other companies schedule more frequent, and less formal, get-togethers, such as softball teams, potluck dinners, and Friday cocktail hour.

How employees feel about, and express satisfaction with, their employer is the basis of a corporate culture. The more positive and fulfilled employees are with the organization they work for, the more loyal and effective they will be. That’s the benefit of a positive corporate culture.

See also: How To Create an Employee Value Proposition

Corporate Culture FAQ

What is corporate culture and examples?

Corporate culture is the shared beliefs, values, traditions, and behaviors of an organization. Examples of corporate culture include an emphasis on customer service, a positive work environment, and ethical practices. Other examples include a focus on productivity, collaboration, and use of technology.

What is corporate culture and why is it important?

Corporate culture is the shared values, beliefs, and behaviors of a company's employees that are expressed through their social interactions and work environment. It is important because it helps to shape the company's identity, create a positive work environment, and drive employee engagement and productivity. Corporate culture can also have an effect on the attitude and behavior of customers, as well as the company's bottom line. Companies with strong, positive cultures have been known to have increased employee satisfaction, better customer service, and higher profits.

What are the 4 types of company culture?

  • Innovative: A culture focused on innovation and creativity where employees are encouraged to think outside the box and come up with new ideas.
  • Results-oriented: A culture focused on achieving results and hitting targets.
  • Collaborative: A culture where employees work together to achieve a common goal.
  • Entrepreneurial: A culture focused on taking risks, trying new things, and embracing failure.
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