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The Importance of Organisational Culture

We all have our own unique personalities that set us apart from everyone else and define us. Similarly, every organisation has its own vision, rules, practices and guidelines. This is essentially the organisation’s personality and known as organisational culture. Much like a human personality, it has certain traits and triggers which help it improve. Read on to understand the importance of organisational culture and our tips to create a thriving workplace culture.

Importance of organisational culture.

Defining Organisational Culture


Distinguished Professor of Management, Jennifer Chatman states that the meaning of organisational culture is “A system of shared assumptions, values, and beliefs that show people what is appropriate and inappropriate behaviour.”


These shared values will influence people within your organisation and regulate how they behave. Every organisation will create and develop its own culture. This will provide boundaries to ensure everyone acts in a way that mirrors the company values. It is vital for all employees to understand this culture if they want to be successful.


“Organisational culture is the sum of values and rituals which serve as 'glue' to integrate the members of the organisation.”

- Richard Perrin


Here at The Happiness Index we believe organisational culture should be determined and built on by everyone within the organisation, rather than taking a top down approach. Every organisation is different based on the diverse group of people within it and its culture should reflect this. More on this here.


The 7 Characteristics of Organisational Culture


It is widely accepted that organisational culture has seven key characteristics. Every organisation will value each of these characteristics, which, when combined, will define the organisation.


1. Innovation


Companies that value innovation will encourage their people to be brave and take risks. This will empower people and inspire them to think creatively. Companies who do not value innovation will have set guidelines and practices that must be adhered to.


2. Attention to Detail


This dictates the level to which employees are expected to be accurate in their work. For some organisations, attention to detail is key for success. Financial organisations and law firms are prime examples of this. A culture that places a high value on this will expect their employees to undertake their duties with precision. A culture that places a low value on this will adopt a “try your best” attitude. Putting less pressure on everyone.


3. Outcome (Results)


Companies that value outcome will focus on results, but not on the processes. They will strive for results by any means necessary. Companies that value the processes will believe that when everything is done correctly, the outcome will take care of itself.


4. People


Organisations that value their people will consider how their decisions affect everyone. These companies will value their staff and will give them input in organisational decisions. The inverse of this is when companies adopt strict policies and procedures and are more focused on financials than people.


5. Teamwork


Companies that organise work activities around teams instead of individuals are advocates for teamwork. They emphasise cooperation and collaboration. Cultures that promote this will encourage positive and open relationships – at all levels.


6. Aggressiveness


This characteristic dictates whether everyone is expected to be forceful or not when dealing with competitors. Companies with an aggressive organisational culture will strive to outperform their competitors at all costs. Companies who oppose this will focus on their own performance more than their competitors’.


7. Stability


A company who encourages stability will be administrative and rule-orientated. They will focus more on maintaining their output and processes, rather than growth. Companies who do not value stability will regularly adapt their processes and practices.


The Importance of a Thriving Organisational Culture


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

- Simon Sinek


A strong organisational culture will ensure that everyone aligns with the company’s values. This will positively impact every part of the business. Here are some ways organisational culture can improve business:


1. Identity


An organisation’s identity is underpinned by its culture. The processes and values of an organisation will contribute to its brand image. Employees, clients, customers and the public will all have their own perceptions of your organisation. This is largely determined by its culture.


2. Onboarding


A company with a clear organisational culture will easily be able to align new starters with the company’s goals, and values. They will have a clear set of practices and beliefs. This will encourage new starters to adhere to their processes and rules of engagement.


3. Loyalty


If your employees view themselves as part of the culture, they will make decisions for the greater good of the organisation. It will also ensure your people will remain loyal during periods of organisational change and won’t consider jumping ship.


4. Direction


When your people are aware of the company goals and vision – they will have a clearer sense of what is expected of them and why. This provides everyone with direction, which will keep your people on-task.


5. Unity


Strong organisational cultures create a sense of community and cohesion. This will help to unite all your people – irrespective of their backgrounds. By encouraging a shared culture within your workplace, you will create a sense of acceptance and diversity in the workplace. This will promote better communication, thus improving collaborative projects and reducing conflicts.


Creating a Thriving Company Culture


Even the best company cultures still have room for improvement. If organisational culture is not on the agenda, or you don’t continue to grow your culture then you risk both retention and recruitment declining.


This is evidenced by best-selling author and ‘personal branding guru’ Dan Schawbel, who suggests “The only thing that companies can do to increase retention rates is to create a superior work culture where employees have friends, are engaged in their work and get perks.”


There are some key areas you can look at to help create a thriving organisational culture. It’s also important to consider the neuroscience themes that drive people at work and think about how you can incorporate them into your culture strategy.


Safety, relationships, freedom and acknowledgement are all key for a happy workforce whilst meaning and purpose, clarity, personal growth and enablement all build employee engagement.




We’ve written a whole article on creating organisational culture, but here’s a few tips that we feel are important for any thriving work culture:


1. Listen


It is vital to listen to your employees and create a dialogue with them. By creating an environment where your people feel comfortable enough to reach out – you will promote honesty and transparency. This will help you to learn how everyone is feeling, so you can remedy concerns and build on successes. Consider an always-on listening tool such as our Employee Voice for open, honest feedback whenever your people need to communicate.


2. Empathise


Empathy is a vital skill for any leader that wants to understand, motivate and recognise the achievement and effort of their people. Our global study of workplace happiness placed ‘feeling recognised/valued’ in the top-spot, which demonstrates how important it is for the modern employee to feel valued and understood.


3. Communicate


This comes hand-in-hand with listening. Clear communication means sharing your thoughts, plans and targets whilst accepting open feedback. Talking to your people regularly will ensure your people feel motivated, valued and engaged. Putting systems in place where your people know how and where to contact you will help you accurately gauge how they are feeling, whilst creating two-way conversations. This will highlight what needs to stop, start, change and continue to improve culture and ultimately profits. We’ve addressed this important need in our platform via our ‘closing the feedback loop’ tool, which allows completely anonymous conversations and feedback to concerns through the platform.


4. Empower & Trust


It is impossible to know everything that goes on within your organisation. It is therefore essential to trust your workers and empower them to make the right call. This may seem quite daunting to some, but the benefits for your organisation and its culture are huge. Manish Goel, from computer software company Aerospike Inc says “It is important for the entire company to know that they are an integral part of the company’s success.” Before adding, “Control outcomes, not behaviours."


A thriving work culture promotes community and provides a platform for everyone to contribute to shared goals. When done correctly, it will breed a culture of trust, engagement and productivity. This will make your organisation a better place to work, which will improve retention, recruitment and profit.

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Joe Wedgwood

"Sun, theatre, running and hummus make Joe happy!"

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