A board member’s guide to company culture

by Stephen Conmy on Dec 27, 2022

company culture

Many people say company culture is about such attributes as an organisation’s values, ethos, and mission. However, company culture can easily be illustrated by asking a straightforward question: how do people see your company? For example, is it innovative? How does it treat its customers? Are its staff happy? Is it growing? A company’s culture says a lot about its board and management and will define the success and potential growth of an organisation.

The culture of your organisation matters simply because it will determine who will work for you and what they will strive to deliver.

What is the meaning of company culture?

Company culture often refers to an organisation’s character and ethos. Company culture can be defined by the mission, values, practices, brand narrative, and overall ethos of the organisation.

Culture is sown at the start of a company and grows and evolves as the company develops.

A successful business relies heavily on its culture. To attract quality employees and potential customers, thriving companies focus on the health and well-being of their people at work rather than just the bottom line.

“Culture is simply a shared way of doing something with a passion.” – Brian Chesky, co-founder, CEO, Airbnb

What is good company culture?

Company culture is a complex subject. If you’re pondering what your ideal corporate ethos might be, consider the following six factors:

  1. Company purpose: Good culture requires a unity of purpose. If employees know what the company’s purpose is and how it will benefit them, they will be able to set their own goals and function as part of a cohesive team.
  2. Growth: To grow a business, each of its employees must have the chance to grow. To do this, leaders must recognise employee achievement, provide leadership development opportunities, create a culture conducive to building meaningful relationships, and reward employees with deserved raises and promotions.
  3. Successful: New employees need to quickly understand that the key to the company’s success is growth. That said, boards should cultivate a culture based on success while avoiding excessive competition. 
  4. Respect: It is crucial for employees to feel respected by their superiors and coworkers alike. Trust and appreciation can build a culture of teamwork that makes employees look forward to coming to work each day.
  5. Employee well-being: Employee welfare is of the utmost importance. Good managers provide health care benefits, vacation time, paid parental leave, and reasonable work hours.
  6. Strong leadership: Culture starts at the top and in the boardroom. An organisation’s culture is shaped by its leaders, who set an example of the company’s values. It would help if you had goals and expectations for yourself and your employees.

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

What are the nine types of company culture? 

There are nine types of company culture, and companies often have an overall culture that is a blend of different culture types. 

1: Clan culture

A company with a clan culture has the feeling of a family environment. The employees know each other and consider each other friends. In an organisation with a clan culture, employees tend to stay for a long time. This leads to the emergence of workplace traditions. Customers are loyal, and partnerships thrive.

Businesses with a clan culture often have difficulty expanding because they put the needs of their employees above the business and have difficulty thinking outside the box.

2: Purpose culture

Employees of a purpose culture strive to achieve a goal for the greater good. This goal might relate to the environment, sustainability, or human rights. For-profit companies with deep values can have a purpose culture, although it is more common in nonprofits.

3: Control culture

Large organisations, especially traditional ones, tend to be hierarchical, and this is known as a control culture. Managerial levels differ, and there is a distinct difference between employees and leaders. Decisions are made at the top of a company with a control culture. For industries where innovation is vital, hierarchical control is unsuitable.

4: Creative culture

In a creative culture, everyone is encouraged to be inventive and should be experimenting constantly with new ideas. Creative cultures can be helpful in industries like tech, where taking risks can yield tremendous rewards. The downside is that such a culture can become highly competitive. 

5: Compete culture

This type of company culture aims to dominate the market. Success is measured by return on investment and market share rather than individual achievements. Decisions are made based on what will help the business meet these two goals.

6: Strong leadership culture

A strong leadership culture promotes solid leadership and the commitment to helping employees succeed. The most important thing is that workers can develop their leadership skills and advance their careers.

7: Customer-first culture

In a customer-first culture, personal accomplishments have less importance than a higher goal – in this case, satisfying customers. Everyone has to work toward the same goal of providing the best services to the customers.

8: Role-based culture

Employees in role-based cultures lead projects based on their expertise rather than their position. Employees are the only ones who can do their jobs at the company and some may even be among the best in their field. The high wages and focus on excellence make this culture appealing for some. 

9: Task-oriented culture

Each day is different in such a culture. Teams meet to decide what work needs to be done and then assign tasks based on skills rather than job titles. A company culture like this is common among startups, where just a few staff members must take on a variety of responsibilities. 

“There’s no magic formula for great company culture. The key is just to treat your staff how you would like to be treated.” – Richard Branson, founder, Virgin Group

Is there an example of a good company culture?

One company that stands out when it comes to having a good company culture is Microsoft. Satya Nadella — who took over as Microsoft CEO from Steve Ballmer – created a culture that focused on supplying customers what they wanted rather than forcing Windows products down their throats.

Nadella’s solution was a new culture dubbed the “growth mindset.”

It was an entirely new way of thinking about learning, doing and failing. As a result of the plan, employees were eager to learn and explore new areas. Customers and partners benefited as a result. Customers also gained access to new products and services.

“I like to think that the ‘C’ in CEO stands for culture, and it defines the success of every organisation. Our culture is at the root of every decision we make at Microsoft, and creating this culture is my chief job as CEO.” – Satya Nadella, CEO, Microsoft 

A video about company culture

Culture is the essence of a business and can make or break a firm. It needs constant nurturing – that couldn’t be more relevant in today’s world of agile working. Watch Zoë Bailey, head of strategic operations at Withers & Rogers LLP, explain more.

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Company Culture

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