The Importance of Company Culture

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An organization’s culture is so impactful, it has the potential to increase productivity, lower costs, and boost a company’s bottom line. All these elements can lead to sustainable growth for the business. It’s essential to understand the importance of company culture, its relationship to employees, and how it can affect growth.

Coworkers collaborating in modern workspace

Company culture can improve performance

Disengaged employees can cost their organizations billions of dollars of lost revenue each year, and a third of employees report that they don’t feel engaged on the job, according to research by the Engagement Institute. A positive company culture can improve performance and prevent burnout or disengagement in several different areas, including:

  • Reputation: Companies boasting a healthy company culture can have a better reputation, potentially attracting strong candidates to be a part of the organization.
  • Employee retention: When a company values its employees, it can result in positive morale and attitudes. This may impact employee loyalty, which can in turn improve retention and decrease recruiting, hiring, and training costs.
  • Increased productivity: With positive morale, productivity can increase, improving the company’s financial health.

Company culture can affect employee satisfaction

Providing a company culture that proves attractive to employees is important and should be a priority for organizational growth and employee satisfaction. Whether seeking employment at a small business or large corporation, many potential candidates look for companies that promote community involvement, strong values, and ethical practices.

In fact, a study done by Deloitte University Press found that culture and engagement are the top challenges facing human resources leaders today.

Company culture can promote diversity and inclusion

In recent years, major social change and public events have caused businesses and organizations to strengthen their stance on diversity and inclusion. Employees want more from their employers than just a paycheck — they expect solidarity on the issues that matter to them and their unique life experiences respected.

Companies can take measurable, solution-oriented steps to enhancing their diversity and inclusion with the following:

  • Include diversity and inclusion initiatives in annual strategic plans
  • Create a forum to highlight and promote diverse perspectives
  • Measure demographics to highlight leadership gaps with minority groups
  • Develop a mentorship or sponsorship program to increase minority representation at leadership and executive levels
  • Provide educational webinars across the company on unconscious and racial bias

Company culture can spur sustainable growth

Each company has a unique organizational blueprint that feeds into its culture, but there are common components among many businesses that promote growth, such as:

  • Company vision: A good culture must begin with a mission statement or vision, providing a sense of purpose and offering a guide to the company’s values. With a clearly stated vision, all employees can work together to move the company forward in a sustainable way.
  • Company values: The values of a company are the very core of its culture, setting a guideline for mindsets and behaviors required to achieve its vision. With a company culture centered on values shared by the entire organization, a business is better prepared for organic growth.
  • Company growth: The goal of any company — and therefore any company culture — is profitability and growth. Culture should be focused on and geared toward these goals. After all, a positive company culture that leaves no room for confusion means that employees know what they’re doing and why. This allows them to be more productive and more profitable, ultimately leading to growth of the whole organization.

Learning the value of company culture for any business is key as you continue you to build your leadership potential. To read more about where to get started, visit Maryville University online.

Recommended Reading

A Guide to Corporate Wellness Programs: Why Employee Health Matters

Organizational Change Management Guide for Developing Innovators & Leaders

Workforce Trends of Today and Tomorrow: A Changing Landscape


Business News Daily, “How to improve your company culture”

The Engagement Institute, “Study: Disengaged employees can cost companies up to $550B a year”

Salesforce, “Why equality and diversity need to be small business priorities”

The Society for Human Resource Management, “Business and Human Capital Challenges Today and in the Future”

The Harvard Business Review, “Diversity and inclusion efforts that really work”