Why Organizational Culture Is Important

3 min. read

Fostering Success: The Significance of Organizational Culture

Does workplace culture really matter? Yes, and understanding why lets you know why we emphasize employee satisfaction. There are four essential reasons why organizational culture is a critical factor worthy of your attention.

Increase Your Employees’ Productivity

More productivity can increase revenue and profit from a purely objective standpoint, affecting your company's top and bottom lines. You win when you’re paying the same salaries but getting more productivity from people; when you ensure those people are happy because of your organizational culture, you AND your employees win.

Decrease Your Turnover

Replacing employees is expensive. When you have to post jobs, recruit, interview, and onboard a new employee, it can affect the productivity of dozens of your team members. Research indicates that replacing one employee can cost approximately 50 - 60% of their yearly salary. Additionally, replacing employees can hurt morale. Team members build rapport, learn each others’ styles, and appreciate the bonds they have at work. When turnover is frequent, even the most happy and engaged employees may look elsewhere.

Attracting the Best Talent

No matter how good your employee retention strategies are, every company needs to hire regularly, whether you’re replacing past employees or your company is expanding. When potential new employees seek work, the company’s organizational culture is often ranked near the top of their priority lists. In fact, a survey by Glassdoor demonstrated that the majority of employees ranked organizational culture as a more critical factor in their job search than pay & benefits. Further, according to a study by MIT, your employees’ happiness is the #1 reason employees stay at a company.

Improve a Company’s Reputation

Decades ago, it was likely easier for companies to bury stories about an unhappy workplace. When stories traveled only by word of mouth, complaints and kudos did not have the same ability to reach the masses. However, companies' reputations are inevitably crucial due to the prevalence of reputation websites, social media, and the almost-instant spread of information. Whether your priority is attracting the best new job applications, finding new partner relationships, or improving your business development efforts, your company's reputation matters. A positive and appreciated organizational culture can significantly affect your business’ reputation.

Build Organizational Culture With Amazing Workplace

When you understand why organizational culture is essential, you’ve taken the first vital step to improve your company’s culture. Before making changes, start by measuring your employees’ happiness levels. Those metrics allow you to make educated decisions, spend resources wisely, and achieve measurable results.

Contact us to schedule a demo and see how we can optimize your organizational culture.