Why Organisational Culture and Business Values Matter for Success

The success of your business hinges not just on strategy but also on the often-overlooked element of organisational culture. Have you ever wondered why some companies thrive while others struggle despite having similar resources and opportunities? The secret often lies in their culture. Organisational culture defines the shared values, beliefs, and practices that shape how your team interacts and works together.

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Your organisational culture can make or break your organisation. Some elements of your culture are likely to help, and others will hinder the achievement of your goals and strategic objectives, not to mention impacting your employees’ motivation and engagement. The importance of fostering a positive and productive culture cannot be overstated.

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In this blog, I will tackle all things organisational culture: what it is, why your business values matter, and how you can fix a culture that’s not where it should be. Whether you’re experiencing a cohesive or disconnected culture, understanding and actively shaping your organisational culture is key to your business’s success.

What is organisational culture?

Organisational culture is one of those seemingly intangible things that is often hard to describe because it can look so different from one business to the next.

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LiveScience defines culture as “the characteristics and knowledge of a particular group of people, encompassing language, religion, cuisine, social habits, music and arts.” It’s an umbrella term covering a wide range of social behaviours, activities, and norms.

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When we look at culture in the context of a company, it generally refers to the values and beliefs that leaders establish and then communicate and reinforce to their employees. Culture shapes how employees perceive your company; it influences their behaviour and shapes our understanding of expectations.

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A strong organisational culture can significantly impact employee engagement. According to a Gallup study, highly engaged teams show 21% greater profitability. Additionally, a study by the Harvard Business Review showed companies with strong cultures saw a 4x increase in revenue growth.

What defines your culture?

Your organisational culture is determined by quite literally everything that happens in and around your business (whether you’re intentional or not).

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What contributes to organisational culture is pretty exhaustive. Here is a short list:

• Your leadership and communication style.
• How you engage and what you share.
• What and how you define expectations, and how your team feel while delivering on those expectations.
• An obvious contribution to your business culture is your vision, mission, and values.
• The beliefs held by each person in the team and the organisational beliefs you encourage.
• The leader isn’t the only one who dictates the culture — everyone contributes.
• Artifacts; the inanimate objects like branding, decor, historical items and what’s in the kitchen.
• What you recognise and reward in your team. 
• Your business’ ground rules which are often unwritten.
• Acceptable and unacceptable behaviours. 
• How your team members are inducted.
• Whether (and why) the organisation invests in ongoing training and development.
• How team performance is managed. What do you do when things get off track or you fall behind?
• The workplace dress code. 
• And even who buys the coffee in the morning impacts the culture.

You might be beginning to appreciate why knowing what drives your culture is so valuable. If you have a culture problem, many elements could be impacting it. The issue is that if your employees aren’t engaged, connected to your mission, and motivated, consistent business growth becomes an uphill battle.

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Historical research by Columbia University shows that the likelihood of job turnover at an organisation with a rich company culture is just 13.9%, compared to 48.4% in companies with a poor culture. This highlights the critical role culture plays in employee retention.

How to work out if your culture is helping or hindering your vision.

Step 1:

The first thing you can do is ask yourself: “Is the environment of my business helping to achieve my strategy?”

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If your vision is clear, and the cultural expectations and subsequent actions align with your strategy, then the people on your team will be working cohesively toward that vision. If not, then it’s time to start unpacking why.

Step 2:

Next, check in with yourself. Do you know what’s actually going on in your business? Take a look at points of friction and calibrate them with your vision. You might find yourself dealing with unwritten ground rules.

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Unwritten ground rules is a term created by a fellow Aussie consultant, Steve Simpson. These unwritten rules can be a powerful force that dictates behaviours in a team or organisation. An example of an unwritten ground rule could be promoting autonomy and self-drive, but the team only works when you’re constantly pushing them for outcomes. The unwritten ground rule here is that people have to wait for you to give the instruction.

Step 3:

Another way to determine whether your culture is helping or hindering your vision is by asking your team directly. Although I haven’t seen this done often, it is a hugely influential and illuminating activity.

You can ask your team questions like:

• How do you perceive the culture of this business?
• Do you think it’s contributing towards the goals of the organisation?
• What do you think we can do to improve the culture and reach those goals?

Touching base with your team is a great way to gauge your culture, especially if you tend to keep your head down, doing business as usual. Remember, when you receive feedback, be prepared for positive and negative responses equally. Most importantly, you must be prepared to rectify situations that negatively contribute to the culture and address any behaviours that are not helping achieve your goals.

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If you don’t feel like you’re in a position to make that happen, or if you’re dealing with too much as a business owner, and this seems like just another thing on the plate, I would advise you to hire a third party.

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It’s worth noting that sometimes, team members are too scared to voice their real opinions, fearing negative repercussions. A third party allows anonymity, meaning you’ll receive the answers your team might be too nervous to tell you, and you don’t have to be in a potentially uncomfortable situation.

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In saying that, how open and honest your team feels they can be with you speaks directly to your company culture…

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“Customers will never love a company until the employees love it first.” Simon Sinek.

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Your organisational culture plays such an important role in achieving your success. If you and your team are not enjoying coming to work, or you’re spinning your wheels and not moving forward, it might be your culture getting in the way.

How to Fix a Bad Organisational Culture Using Values and Behaviours

Focusing on values and behaviours can be a powerful solution if you think your organisational culture is not where it should be. Here’s how you can start making changes:

1. Identify Core Values:

1. Define the core values that reflect your company’s mission and vision.
2. Ensure these values are clear, actionable, and aligned with the desired culture.

2. Communicate and Reinforce Values

1. Consistently communicate your values through all channels – meetings, newsletters, and daily interactions.
2. Reinforce these values through stories, recognition, and rewards that highlight examples of these values in action.

3. Model Desired Behaviours

1. Leaders should embody the values and behaviours they wish to see in their team.
2. Regularly demonstrate commitment to the values through your actions and decisions.

4. Hire and Develop with Values in Mind

1. Integrate values into your hiring process by evaluating candidates based on their alignment with your company’s core values.
2. Provide ongoing training and development that reinforces these values and encourages the desired behaviours.

5. Create Accountability

1. Establish clear expectations for behaviours that align with your values.
2. Hold everyone accountable, from top leadership to entry-level employees, ensuring that violations of these values are addressed promptly and consistently.

6. Foster an Open Feedback Culture

1. Encourage open communication where employees feel safe to share feedback and suggestions.
2. Regularly solicit input on how well the company lives its values and what can be improved.

7. Celebrate and Reward Alignment

1. Recognise and celebrate individuals and teams who exemplify the company’s values.
2. Use rewards and incentives to promote positive behaviours that align with the desired culture.

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These steps can help you start the process of reshaping your organisational culture into one that is optimistic, united, and in harmony with your business objectives.

Why Business Values Matter

I’ve mentioned values a lot throughout this blog, and the reason is that business values are the foundation of an organisation’s culture, guiding behaviour, decision-making, and overall company direction. They create a sense of identity and purpose, helping employees understand what the organisation stands for and what is expected of them. Strong values foster a positive work environment, enhance employee engagement, and align actions towards common goals. Moreover, values attract like-minded talent, build customer trust, and drive long-term success by ensuring consistency and integrity in every aspect of the business.

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According to a study by Deloitte, companies with a strong sense of purpose and culture have 30% higher levels of innovation and 40% higher levels of retention. This illustrates how essential business values are to fostering a thriving organisational culture. I have many videos on values, so I’d encourage you to start here if you want to know more.

Conclusion

Your organisational culture plays a critical part in achieving your success. If you and your team do not enjoy coming to work or are spinning your wheels, it might be your culture getting in the way. Take proactive steps to assess, redefine, and reinforce your culture, focusing on values and behaviours.

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If you’re ready to transform your organisational culture or establish values that drive it positively, contact us. We love assessing current cultures and creating a roadmap for improvement that is aligned with your goals.

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