Definition and Key Elements of Corporate Culture
Corporate culture, first and foremost, refers to the norms of behavior among a company’s employees and their attitudes towards one another, which are primarily shaped by top managers, the HR department, or the company’s leader. In addition to the desire to purchase products from these companies, people want and even dream of working in their team. All of this is due to the development of a positive corporate culture.
Corporate culture has existed in every company since its inception, and it is never spontaneous; traditions are honed and accumulated over time. The concept of corporate culture encompasses various aspects, including the company’s values, both moral and material. It also implies ethical norms and rules of conduct in the work process, as well as the company’s strategy and development guidelines. Ultimately, key elements of corporate culture include traditions, customs, and leadership styles.
The Role of Corporate Culture in Employee Motivation and Company Performance
Corporate culture is often taken for granted by employees as a reflection of the company’s quality, which is difficult to isolate from the overall system. Awareness of the pros and cons typically occurs when an employee transitions to a new company and can compare approaches. The purpose of corporate culture is to create and convey the company’s values to employees and customers, which can be both universal and unique. Among the methodologies used to study corporate culture are surveys of customers and suppliers, observing a manager’s working day through photography, group interviews, experiments, and others.
Corporate culture determines the company’s market positioning, how it interacts with customers, partners, and suppliers, and its financial performance directly depends on it. The right culture motivates employees and allows them to achieve a high level of involvement in work processes. Furthermore, a strong corporate culture can help create a positive image of the company in the eyes of consumers and job seekers. Employees feel like part of the team, which positively affects their self-esteem. Thanks to well-established norms and rules, new employees quickly adapt, and this, among other things, reduces staff turnover.
Corporate culture is also responsible for creating regulations and standards that apply to the entire company and its departments and branches. Systematization and orderliness of work processes make work more efficient. For example, employees do not waste time searching for the responsible person for a task because they know who to contact immediately. Corporate culture is formed in both small and large businesses. Thanks to it, the team’s cohesion improves, employee interest and involvement grow, and the company develops more quickly.
Developing and Shaping Corporate Culture
Deciding on cultural development should be based on the company’s goals. To have strong specialists on the team, a corporate culture is necessary. It affects employee satisfaction levels. When people are comfortable in the company, they bring more value, work longer, and bring vital specialists to the team.
It is essential to invest in corporate culture as a business transitions to sustainable development. Initially, the company survives, and only what generates revenue matters. However, as soon as a company starts to scale and expand into new markets, it needs to allocate resources to work on its corporate culture. For example, clan culture is characterized by kinship or friendship among individuals and loyalty to the company’s founder. In the market, employees are focused solely on business performance and, to a lesser extent, on relationships; they strive to achieve the best results at any cost.
Corporate Culture as a Competitive Advantage
Companies go to great lengths to attract and retain customers. Artificial intelligence, big data, and other latest technologies are designed to personalize customer communication. However, no matter how useful and economically justified these tools are, human communication and its quality are decisive factors in building relationships with customers.
Corporate culture is the main competitive advantage in today’s world, where everything is quickly reproduced and copied, including business models. Depending on its strategic goals, the company may choose one option over another to shape its corporate culture. Ultimately, it will determine the user experience customers receive.
In his publication, MacQueen (2019) describes the purpose of corporate culture as increasing the company’s efficiency. The methodology was based on building relationships between employees and superiors. As a result, the author concluded that companies with a strong corporate culture tend to have more positive work experiences.
Reference
MacQueen, J. (2019). The flow of organizational culture: New thinking and theory for better understanding and process. Springer International Publishing.