When you are asked in an interview, “why do you want to work at company x”, workplace culture usually comes up. As you read the news, you can also hear about companies like Zappos with great culture and companies like Away where there are horror stories of employees bullying others over Slack.
Taking a step back, culture is born out of a company’s deeply-held beliefs, and what employees of the company value. A strong culture is essential for a company to perform well. In fact, McKinsey found that companies with healthier cultures perform better than companies with unhealthy cultures. Similarly, BCG found that companies “with a purpose- driven organizational culture outperform their peers” (read more here). In fact, per Bain, “companies that create a winning culture are five times more likely to be top performers” (read more here).
This article will define workplace culture and provide examples of both healthy and unhealthy workplace cultures.
What Is Workplace Culture?
A workplace culture will be formed by the underlying beliefs and “truths” held by an organization. For example:
- Wharton defines workplace culture as the “beliefs and orthodoxies, values, and behaviors that are taken for granted in the workplace” (read more here)
- Denise Lee Yohn in the Harvard Business Review defines 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” (read more here)
- Bain defines culture as a three-part system, i.e., “purpose, values, and beliefs”, “visible collective behaviors” and “enablers, signals, and reinforcers” (read more here)
One way to think about workplace culture is that workplace culture is like an iceberg. For example, in 1976, Edward Hall developed the cultural iceberg model, where the unconscious culture (e.g., the values and thought patterns) shape the beliefs which subsequently shape behavior.
Workplace Culture Examples
Several companies are known for having excellent workplace cultures. For example:
Zappos is widely recognized as a great place to work. They make sure that every new team member reflects the company culture, and they solidify their culture with 10 core values. (e.g., “build a positive team and family spirit; create fun and a little weirdness”). These values gave employees a roadmap re. Zappos’s culture (read more here and here)
Known for having a caring culture; Southwest culture is backed by its purpose to “connect People to what’s important in their lives through friendly, reliable, low-cost air travel.” By appreciating employees and creating times for celebration, Southwest creates a friendly culture and is able to deliver exceptional customer service (read more here and here)
Toxic Workplace Culture
One example of a toxic workplace culture is Away luggage (full story here). Some examples of the culture include:
- Encouraging employees to post in public Slack channels which led to intimidation
- Limiting paid time off and encouraging long hours which could lead to burn out but also could have helped the company grow super quickly
- Allegedly using disparaging language
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Importance Of Workplace Culture
Workplace culture is extremely important both to an individual’s satisfaction at their job and for the company’s overall performance. Interestingly, BCG found that “in a study of 40 digital transformations, companies that focused on culture were 5x more likely to achieve breakthrough performance than companies that neglected culture” (link here). In addition, McKinsey found that companies with the top quartile of culture are likely to “post a return to shareholders 60 percent higher than median companies” (link here).
Clearly workplace culture is important. In fact, some believe that having a strong strategy can be undermined without an aligned strategy.
How To Improve Workplace Culture
There are multiple ways to improve workplace culture. However, at an individual contributor level, it may be hard to make a difference. That being said, there are still ways to first define what your purpose and mission is, e.g., you can ask questions like:
- Why is your team set up?
- What are your teams’ main goals?
In addition, you can role model the behaviors you are looking to promote, if you think it is appropriate within the team and the workplace setting. However, keep in mind that modeling workplace culture is easier if you are a team leader rather than a team contributor.
Therefore, workplace culture is an essential aspect to test for when joining any company. Workplace culture relates to the beliefs, values, and behaviors a company holds. When there is a workplace culture that you feel passionate about, you are more likely to feel engaged. In addition, companies with healthy workplace cultures are more likely to outperform companies that have unhealthy workplace cultures. While it may be difficult to shape workplace culture as a junior level employee, you can still shape the culture of your sub-team by pushing to define the team’s mission and vision. For tips on how to assess workplace culture, you can speak to an ex-MBB consultant here.