How to Balance Company Culture with Business Goals
Which came first: the company or the culture?
Trick question—you can’t have one without the other. If a company has people, it automatically has a culture. The question is, is it a culture that supports your business goals?
With millennial employees as the new workplace majority, it’s easy to equate company perks with company culture. After all, who wouldn’t enjoy a free nap pod or unlimited vacation? But for mid-sized businesses, it can be hard to balance company culture needs with revenue goals.
Luckily, you don’t have to sacrifice productivity for ping pong or scale back your future plans to make sure everyone is having a good time. The key is balance.
Good company culture can result in an almost 20 percent increase in operating income and 28 percent increase in earnings growth. When both business goals and culture align, it equals success for both you and your employees.
Defining company culture
So, is company culture free beer and ping pong? While we know the answer to that question is “no,” there’s still not a consensus on what company culture is exactly.
Some refer to company culture as a company’s personality. Others say it’s an ongoing give and take. Wikipedia defines organizational culture as “the collective values, beliefs and principles of organizational members..and includes the organization’s vision, values, norms, systems, symbols, language, assumptions, beliefs, and habits.”
Think of it this way: how do you know if a job candidate is a good fit? Outside of their skills and experience, it’s likely because their values, priorities, and work style match yours and your team’s. When you’re comparing what makes a good “fit,” that’s your culture.
Company culture isn’t just free beer or other office perks. It isn’t about one thing or tied to one person at all. It’s something you and your employees build together, through the way you work, the values you share, and how you communicate.
How company culture impacts your business goals
Whenever an employee interacts with a customer, they’re participating in two systems: business and culture. It’s about making a sale but also communicating what sets your business apart from competitors.
For this to work, your business strategy and company culture must be equally strong. Research has shown time and time again that positive company culture leads to better employee engagement and supports higher revenue. In contrast, companies that succeed business-wise without a healthy culture eventually see a performance decline.
The most engaged employees have been found to have four times more success than the least engaged employees. They also outperform less engaged employees by 10 percent on customer ratings, 22 percent in profitability, and 21 percent in productivity.
Employee engagement and productivity are signs of a healthy company culture. A healthy culture isn’t necessary for short-term financial success, but you are more likely to become less profitable over time without it. Plus, when employees feel their values are reflected in their company culture and that they’re part of a bigger purpose, they feel more invested in the company’s success and contribute more to the company’s overall bottom line.
How to balance it all
The clash of values happens when company culture and business goals don’t support each other. If your culture and your employees share values that aren’t aligned with your business goals, it can be hard to turn your goals into reality.
For example, if your culture values quality over quantity and encourages employees to take their time, switching to a minimum viable product model is going to be a huge culture shift. Expecting employees to stay late or work overtime when they’ve always left at 5 p.m. is going to spark more than a little resistance.
Markets change, and so does your business strategy. When business strategy changes, so must your culture if it doesn’t match—or vice versa. Get ahead of a culture or business shift now by learning what guides your company culture and influences the way your team works today.
1. Set clear intentions for your culture
Company culture happens, either intentionally and unintentionally. You can influence it from the very beginning or make adjustments after it’s in place. The latter is more challenging, but it’s never too late to set goals for your culture and enact change.
Balancing culture with business goals starts with defining what your company culture is and what you want it to be. Ask yourself the following questions:
- What values do you want your employees to share with customers every day?
- What values do you and your employees already align on?
- What is your primary method of communication, and is it working?
- What sets you apart from other businesses?
- What does “good work” or a “job well done” look like?
- What is your ideal employee?
Once you define these aspects of your culture, compare them to your current business goals. See where they already overlap and which areas might need work. Then it’s time to get your employees involved.
2. Identify company culture ambassadors
Good company culture is built on shared values, but also shared trust. However, a majority of today’s employees are distrusting of leadership and believe their peers to be more credible than CEOs. The further you go down a company’s organizational chart, the more distrust increases.
As a workplace leader, you play a powerful role in creating and guiding company culture. But personal attitudes and values are influenced by the people we spend the most time with. For the average employee, that’s their peers, not the company founder or their manager.
The people we spend time with—peers, family, and friends—all help build our “behavioral norms,” our idea of how we should behave and how we expect others to behave in certain environments. Naturally, we trust their experiences first before the distance experience of the CEO.
When it comes to aligning company culture with business goals, go to the people your employees already trust the most: their fellow teammates. Identify several key trusted employees who most closely identify with your cultural goals to be your new company culture ambassadors.
Your best candidates will be excellent communicators and good listeners with outgoing personalities. While you’re running the business, they should be able to keep an eye on company culture, guide and inspire their fellow employees, organize fun team events, and give feedback on what programs are working and not working.
3. Use change as a growth opportunity
Change doesn’t have to be a bad thing. When trying to align company culture with business goals, it’s important that employees know you aren’t taking away what they fundamentally value or love about their work. It’s about making things better and building a great place to work for everyone.
A strong, productive company culture depends on one main factor: great employees. That doesn’t necessarily mean firing staff or hiring a whole new team that better aligns with your goals.
Instead, use this opportunity as a chance for employees to revisit their own work goals. What would they like to accomplish in their roles? What does true success look like for them? If employees are struggling to perform, you may find that they aren’t able to pursue their goals because of the current company culture, not in spite of it.
Lack of clear progression in a current role is one of the main drivers of employee turnover. If you have a culture of low employee retention and new employees are starting and quitting all the time, your team probably doesn’t believe professional development is a shared value.
Sit down with your employees and discuss what they would like to achieve in the next year. Find out where their personal goals coincide with business goals and how they can strengthen each other. For example, pursuing a new certification or taking a class could put them in a position to take over a new initiative, like better customer service or an employee retention program.
Most importantly, set a real timeline. It’s easy enough to talk about goals and employee growth. Give your employees actual dates on the calendar for check-ins or next steps.
4. Find a compromise
Balance requires compromise. When you’re making fundamental changes to how your team works, it’s important to give a little both ways.
No one wants to be the fun police. But if your company culture encourages always ending work early or no real consequences when a shift is missed, getting employees to up production volume or work longer hours may feel like an uphill battle.
You know what you want. Now, find out what your employees want. They’ve probably mentioned one or two things along the way, like more supplies or a new coffee machine. It could be new team shirts or recognition for the hard work they’re already doing.
While fulfilling these smaller asks can go a long way, there’s one change that can make a lasting impact on your company culture: an increase in base pay.
If your goal is higher profits, higher employee costs don’t automatically put you in the red. In a 2014 study on Costco and other higher-wage hourly retailers, researchers found that companies like Costco are actually more profitable because of high employee wages.
One of the main hypotheses? If employees aren’t stressed about being able to cover their basic living expenses, they’re able to perform better at work. Employees with less stress concentrate more on the tasks at hand, have better overall health, less absenteeism, and are more productive, resulting in higher revenue and overall profits
As I said before, business success requires employee buy-in. A wage increase now is a fair price to pay for more engaged employees who are equally invested and passionate about your goals.
Like most things, aligning company culture and business strategy is all about balance. A positive company culture can lead to increased revenue and employee engagement, without requiring unrealistic perks or a large budget. By starting with shared values and exploring better ways to work, you can help both your business and your employees achieve long-term success.How to Balance Company Culture with Business Goals Grace Madlinger