Good Company Culture: Definition, Examples, and Tips for Making Yours Great

December 29, 2022 Ryan Stoltz
good company culture and team morale

The culture you nurture within your company affects every aspect of your organization. Deloitte’s research shows that 88% of employees and 94% of executives believe that good company culture is vital to a business’s success.

In this article, we’ll discuss everything you need to know about what a good company culture looks like and why it’s so important throughout the organization. We’re also going to explore some tips on establishing a good workplace culture of your own.

Let’s jump in!

What is good company culture?

Generally, company culture requires a combination of good ethics, values, workflow, goals, management, and expectations. A good organizational culture aligns with its employees’ attitudes and expectations, boosting their performance within the company.

Why is having a good company culture important?

The importance of a good company culture reflects not only in the employees’ satisfaction but in the organization’s overall productivity.

For instance, an organization with a healthy work culture can improve employees’ enthusiasm, motivation, and attachment to their jobs.

Moreover, a positive company culture reflects not just on the environment of the workplace. It also translates to the individual productivity of employees, which in turn benefits the company’s overall performance.

What are the signs or characteristics of good company culture?

organization's leaders discuss mission and values

On average, employees spend approximately 90,000 hours at work over a lifetime. Therefore, the workplace environment significantly dictates the quality of their professional life.

That said, here are the signs or characteristics of good company culture:

1. High employee retention rate

One of the major characteristics of a good company culture is a high employee retention rate. Employees who are happy and satisfied are likely to stay in the organization.

Employees don’t want to be a part of an organization where they feel unappreciated for their contributions to the company. Ultimately, it can result in higher rates of employee turnover.]]

2. Higher rates of quality applicants

There are tons of budding talents in the industry that are looking for the right workplace to apply their skill sets and earn experience. In this case, good company culture comes into play.

Hence, it would help to keep your current employees satisfied to spread the good word and attract new talents.

3. High levels of job satisfaction ratio

Job satisfaction is one of the major indicators of a good corporate culture. It’s one of the key elements that employees use to decide whether they want to work in your company or not.

Therefore, business owners who invest in the development and well-being of their employees are more likely to succeed in the long run.

4. Successful teamwork

Another indicator of a healthy workplace environment is open communication and employee social interaction. When they come together as a team, they achieve great results.

5. Improved productivity

Employees are more motivated and dedicated to their job when they work in an excellent organizational culture. Ultimately, motivated employees lead to improved overall productivity.

6. Reduced work stress

A good company culture reduces workplace stress and helps boost employees’ health and performance. Therefore, organizations with a positive work environment are less likely to encounter issues related to stressed workers.

How can you build a good company culture?

hr team discuss what makes a great culture

A company’s values, vision, and mission are only part of its culture if you put them into action. Until then, they’re just words on paper.

Here’s how you can build an ideal company culture:

Step 1: Live your company values

Employees with a sense of meaning and purpose are more than 4x as likely to love their jobs. When their goals are tied to the organization’s, it provides just that. But it’s not enough to set core company values. Leadership must demonstrate them to inspire employees’ trust and investment in the organization’s mission.

Communicate and embody your company values to strengthen your culture end employer brand.

Step 2: Establish rewards for success

Employees who feel unappreciated for their valuable contributions to the company often leave the organization. In fact, it’s one of the major reasons why companies lose great employees.

In contrast, motivation and incentives can lead your company to great heights. According to incentive theory, rewards can positively impact human behavior. This means consistent praise and recognition can keep your employees satisfied and motivated.

For instance, Social Recognition® by Workhuman® allows employees to nominate one another for their good performances. Aside from the recognition, they can receive rewards as well.

Step 3: Connect with your employees

Another tip for establishing a good company culture is getting to know your employees. Having meaningful conversations with them can help you connect with them beyond professional territory.

Although some business owners refuse to cross the line between personal and professional territory, it’s a good thing. By creating a relationship with your employees, they’ll become attached to the organization.

Step 4: Support flexible work

Sitting at a desk all day long or working on a demanding project can be overwhelming. Plus, it can get a little boring. Employees may feel more productive if they break up their work routines and work at their favorite coffee spots instead.

Step 5: Hire good people

A community that shares the same values and beliefs is one of the key elements of a positive work environment. Ultimately, the values of the community come down to how founders or business owners want to shape the environment.

Hiring the right people in the first place can impact the workplace community. Although there are lots of talents in the industry, not everyone can be culturally fit for your workplace.

Keep in mind that good people create a good company culture.

How can you tell if your culture is positive?

positive company culture results in happy employee

Monitoring your company’s culture can help you gain insights into which aspect to improve. You can also maintain the elements that make your corporate culture great for your employees.

Here are a few ways to tell if your culture is positive:

1. Gather feedback from your employees

There’s no better way to evaluate your corporate culture than to get insights directly from your employees. Survey how your employees regularly about the company culture to gauge sentiment over time and identify opportunities for future initiatives.

You can use MoodTracker® to help you determine the work environment and address their concerns within the workplace. Send pulse surveys to gauge engagement, job security, and satisfaction – especially during times of change – to get real-time insight into how people feel.

2. You have a consistent, low turnover rate

Low voluntary turnover and higher numbers of tenured employees are other signs of positive culture. As I mentioned, employees who feel supported and appreciated by their organization have less cause to leave.

Monitoring your voluntary turnover and overall turnover rate over time and surveying employees about their job security and satisfaction should help you understand what motivates employees to stay or could make them leave.

3. Positive brand identity and a high rate of referrals

HR can gather an understanding of their company culture through the hiring process.

Are your employees actively bringing in new talent? Employees will actively look to recommend an organization they find positive to their networks.

Ask applicants what drew them to a job listing or your organization during the hiring process. Use a survey or ask them in the early stages of the interview process. Tracking this can also give you a marketing advantage in tight labor markets.

4. Employees are regularly recognized

Organization-wide appreciation is a critical element of a positive culture. If you have high engagement in a reward and recognition program tied to company values, Workhuman has found:

  • Half as likely to be looking for a new job
  • More than 2x as likely to be highly engaged
  • More than 2x as likely to feel respected at work
  • More than 3x as likely to see a path to grow in the organization

The more recently someone has been thanked, the greater their sense of connection to their company culture and colleagues is. And the more a company can socialize recognition across the organization, the greater the impact of that recognition is.

See how recognition can positively impact your workforce by downloading Workhuman’s report The ROI of Social Recognition
positive cultures inspire employees

What are examples of good company culture?

Successful businesses have one thing in common: a good company culture. Here are examples of companies that have amazing work environments:

Microsoft

Microsoft focuses more on its employees’ professional growth. It establishes an inclusive environment by cultivating an openness to new ideas. By making their employees feel heard, they boost their confidence in performing their tasks.

Google

The company nurtures its employees’ overall happiness by providing perks, compensation, and work-life balance. Google focuses on employee satisfaction because it’s an important element in retaining excellent talent.

Frequently Asked Questions

Conclusion

Good company culture is a reflection of a company’s values, workflows, expectations, and management. It plays a significant role in a company’s overall performance and future success.

Moreover, you can create a good organizational culture by hiring the right people, rewarding your employees’ remarkable contributions, connecting with them, and occasionally skipping the usual work routine.