Quantum Leadership

Lecture 5
By
Restituto R. Ramos, M.A.
Organizational Culture: Definition, Importance, and Development

• A great organizational culture is the key to developing

the traits necessary for business success. And you’ll see
its effects in your bottom line: companies with healthy
cultures are 1.5 times more likely to experience revenue
growth of 15 percent or more over three years and 2.5
times more likely to experience significant stock growth
over the same period.
• Despite this, only 31 percent of HR leaders believe their
organizations have the culture they need to drive future
business, and getting there is no easy task — 85 percent
of organizations fail in transforming their cultures.
What is organizational culture?

• Organizational culture is the set of values, beliefs, attitudes,

systems, and rules that outline and influence employee
behavior within an organization. The culture reflects how
employees, customers, vendors, and stakeholders experience
the organization and its brand.
• Don’t confuse culture with organizational goals or a mission
statement, although both can help define it. Culture is created
through consistent and authentic behaviors, not press releases
or policy documents. You can watch company culture in action
when you see how a CEO responds to a crisis, how a team
adapts to new customer demands, or how a manager corrects
an employee who makes a mistake.
What is the importance of culture to your company?

• Improve recruitment efforts – 77% of workers

consider a company’s culture before applying
• Improve employee retention – culture is one of the
main reasons that 65% of employees stay in their job
• Improve brand identity – 38% of employees report
wanting to change their job due to poor company
culture
• Improve engagement – companies with a positive
culture have up to 72% higher employee engagement
rate
• Organizational culture affects all aspects of your business, from
punctuality and tone to contract terms and employee benefits.
When workplace culture aligns with your employees, they’re
more likely to feel more comfortable, supported, and valued.
Companies that prioritize culture can also weather difficult times
and changes in the business environment and come out
stronger.
• Culture is a key advantage when it comes to attracting talent and
outperforming the competition. 77 percent of workers consider a
company’s culture before applying, and almost half of employees
would leave their current job for a lower-paying opportunity at
an organization with a better culture.
• The culture of an organization is also one of
the top indicators of employee satisfaction
and one of the main reasons that almost
two-thirds (65%) of employees stay in their
job.
High impact levers to drive productivity and resilience amid a pending
recession
• Consider Microsoft and Salesforce. Both technology-based
companies are world-class performers and admired brands, and
both owe this in part to prioritizing culture.
• Microsoft, known for its cut-throat competitiveness under Steve
Balmer, has been positively transformed by Satya Nadella, who
took over as CEO of the company in 2014.
• He embarked on a program to refine the company culture, a
process that upended competitiveness in favor of continuous
learning. Instead of proving themselves, employees were
encouraged to improve themselves. Today Microsoft’s market
cap flirts with $1 trillion and it is again competing with Apple and
Amazon as one of the most valuable companies in the world.
• Salesforce puts corporate culture front and center and has
experienced incredible growth throughout its history.
• Marc Benioff, Salesforce’s founder and CEO, established
philanthropic cultural norms that have guided the company
over the past two decades.
• All new Salesforce employees spend part of their first day
volunteering and receive 56 hours of paid time to volunteer a
year. This focus on meaning and mission has made Salesforce
one of the best places to work in America
according to Fortune, and it hasn’t compromised profits
either: Salesforce’s stock price has surged year after year at an
average of over 26% annually to date.
How do you improve organizational culture?

• Key ways to improve organizational culture

include:
• Connect employee work to a purpose
• Create positive employee experiences
• Be transparent and authentic
• Schedule regular and meaningful 1:1s
• Encourage frequent employee recognition
Qualities of a great organizational culture

• Every organization’s culture is different, and it’s important to retain what

makes your company unique. However, the cultures of high-performing
organizations consistently reflect certain qualities that you should seek to
cultivate:
• • Alignment comes when the company’s objectives and its employees’
motivations are all pulling in the same direction. Exceptional organizations
work to build continuous alignment to their vision, purpose, and goals.
• • Appreciation can take many forms: a public kudos, a note of thanks, or a
promotion. A culture of appreciation is one in which all team members
frequently provide recognition and thanks for the contributions of others.
• • Trust is vital to an organization. With a culture of trust, team members
can express themselves and rely on others to have their back when they try
something new.
• • Performance is key, as great companies create a
culture that means business. In these companies, talented
employees motivate each other to excel, and, as shown above,
greater profitability and productivity are the results.
• • Resilience is a key quality in highly dynamic environments
where change is continuous. A resilient culture will teach leaders
to watch for and respond to change with ease.
• • Teamwork encompasses collaboration, communication, and
respect between team members. When everyone on the team
supports each other, employees will get more done and feel
happier while doing it.
• • Integrity, like trust, is vital to all teams when they rely on each
other to make decisions, interpret
• • Integrity, like trust, is vital to all teams when they rely on each other
to make decisions, interpret results, and form partnerships. Honesty
and transparency are critical components of this aspect of culture.
• • Innovation leads organizations to get the most out of available
technologies, resources, and markets. A culture of innovation means
that you apply creative thinking to all aspects of your business,
even your own cultural initiatives.
• • Psychological safety provides the support employees need to take
risks and provide honest feedback. Remember that psychological safety
starts at the team level, not the individual level, so managers need to
take the lead in creating a safe environment where everyone feels
comfortable contributing. Now that you know what a great culture
looks like, let’s tackle how to build one in your organization.
8 steps to building a high-performing organizational culture
• 1. Excel in recognition
• Recognizing the contributions of all team members has a far-
reaching, positive effect on organizational culture. Experts agree that
when an organization makes appreciating employees part of its
culture, important metrics like employee engagement, retention, and
productivity improve.
• Making recognition part of your culture means it should be frequent,
not something saved for milestones or work anniversaries.
Companies who invest in consistent social recognition see a
remarkable business impact: they are four times more likely to
increase stock prices, twice more likely to improve NPS scores, and
twice more likely to improve individual performances.
• Monetary recognition is valuable as well.
• Consider a points-based recognition program
that will allow employees to easily build up
point balances that can be redeemed for a
reward that’s meaningful to them.
• To nurture organizational culture, recognition should be
clearly tied to company values and specific actions and
supported by leadership. After all, 92 percent of employees
agree when they’re recognized for a specific action, they’re
more likely to take that action again in the future.
• Last but not least, leadership needs to take center stage in
your recognition efforts, as they’re the cultural trendsetters
for your entire company. Incorporate a recognition talk
track into your leadership training and share top tips with
managers on how to recognize others and why it matters.
2. Enable employee voice

• Creating a culture that values feedback and

encourages employee voice is essential. Failing
to do so can lead to
lost revenue and demotivated employees.
• First, collect feedback using listening tools that
make it easy for employees to express what
they’re feeling in the moment, like
pulse surveys and workplace chatbots.
• Then, analyze the results and take action while the findings
are relevant. This strengthens your culture and leads to
benefits like higher employee fulfillment and greater
profitability.
• According to a Clutch survey, 68 percent of employees who
receive regular feedback feel fulfilled in their jobs, and Gallup
found that organizations with managers who received
feedback on their strengths showed 8.9 percent greater
profitability. And watch for more subtle expressions of
feedback, like body language. Managers should treat all
conversations with employees as opportunities to gather and
respond to feedback and act as a trusted coach.
3. Make your leaders culture advocates

• Building a strong workplace culture is in the hands

of team leaders and managers. If your workplace
culture prioritizes certain values and your
leadership team doesn’t exemplify them — or
displays behaviors that go against them — it
undermines the effort.
• Team members will recognize the dissonance
between stated values and lived behaviors. They
may even start to emulate negative behaviors,
believing they are rewarded by management.
• Your leadership team can help build the right culture
by prioritizing it in every aspect of their work lives.
• This includes openly discussing the organization’s
culture and values and incorporating employee
feedback into their cultural advocacy efforts.
• While 76 percent of executives believe their
organization has a well-communicated value system,
only 31 percent of employees agree.
• When employees see leaders living your culture,
they’ll follow suit.
4. Live by your company values

• Your company’s values are the foundation of its culture. While

crafting a mission statement is a great start, living byYour company’s
values are the foundation of its culture. While
crafting a mission statement is a great start,
living by company values means weaving them into every aspect of
your business.
• This includes support terms, HR policies, benefits programs, and
even out-of-office initiatives like volunteering. Your employees,
partners, and customers will recognize and appreciate that your
organization puts its values into practice every day.
• You can also recognize employees for actions that exemplify your
values to show that they’re more than just words and incentivize
employees to build the value-based culture you want to see.
5. Forge connections between team members

• Building a workplace culture that can handle

adversity requires establishing strong connections
between team members, but with increasingly
remote and terse communication, creating those
bonds can be challenging.
• Encouraging collaboration and engaging in
team building activities — even when
working remote — are two effective ways to bring
your team together and promote communication.
• Look for and encourage shared personal
interests between team members as well,
especially among those from
different generations that might otherwise
have a difficult time relating to each other.
• This can create new pathways for
understanding and empathy that are vital to
improving communication, creativity, and
even conflict resolution.
6. Focus on learning and development

• Great workplace cultures are formed by employees who are

continually learning and companies that invest in staff development.
Training initiatives, coaching, and
providing employees with new responsibilities are all great ways to
show your team that you’re invested in their success.
• Workplace Coaching: What is it and how is it effective?
• A culture of learning has a significant business impact. Find Courses’
most recent benchmark study found that companies with highly
engaged employees were 1.5 times more likely to prioritize soft skills
development. It also found that companies that had experienced
revenue growth in the previous financial year were twice more likely
to use innovative learning technologies and three times more likely
to increase their learning and development budgets
7. Keep culture in mind from day one

• When an employee’s perspective doesn’t

match your company culture, internal discord
is likely to be the result.
• Organizations should hire for culture and
reinforce it during the onboarding process and
beyond. Practices and procedures must be
taught, and values should be shared.
• When hiring, ask
questions focused on cultural fit, like what
matters to the interviewee and why they’re
attracted to working at your company.
• But these questions shouldn’t be the sole
determining factor when evaluating a
candidate, as the best organizations keep an
open mind to diverse perspectives that can
help keep their culture fresh.
• You should also prioritize
building social relationships during the
onboarding process so that employees have
the insight necessary to understand your
company’s culture and values.
• These relationships will last throughout the
employee’s time at the company, so that
cultural values are mutually reinforced on a
continuous basis.
8. Personalize the employee experience

• As modern consumers, your employees expect

personalized experiences, so you need to focus on ways to
help each team member identify with your culture.
• Tools like pulse surveys and employee-journey mapping are
great ways to discover what your employees value and what
their ideal corporate culture looks like.
• Take what you learn and tailor your actions to personalize the
employee experience for your team. Once you start treating
your employees with the same care you treat your customers
, a culture that motivates each individual at your organization
is sure to follow.
Developing culture made easy

• Organizational culture will develop even without your

input, but in the absence of that guidance, it may not be
healthy or productive.
• Keep these three basic techniques in mind when
developing your company culture: communication,
recognition, and action.
• By following the steps in this guide, you can improve
communication with employees, start creating a culture
of recognition, and ensure that all members of your
team put your culture into action.
•