Company culture, or Organisational Culture, is a vital force that shapes how your organisation operates and achieves its goals. Culture determines how employees work, interact, make decisions, and execute the overall strategy of the company. In large organisations, different departments, regions, or even teams may develop their own cultures - or, as we call them, subcultures. This makes measuring culture absolutely essential in order to ensure alignment throughout the company.
Leaders often focus on business strategies, but without a culture that supports these plans, even the most well-thought-out strategy can fail. Culture serves as the foundation that dictates how employees engage with their work and collaborate effectively. In this article, we’ll explore why understanding and measuring your company’s culture is not just important, but essential to its overall success, and guide you through how to measure the culture of your organisation.
"Crafting the right strategy is hard, making sure it works is even harder."
—Egbert Schram, Group CEO, The Culture Factor Group
Measuring company culture is essential because it directly influences the success of your business strategy. Culture is the underlying force that shapes how employees interact, work, and make decisions. It is also the “something” of your company that can make you truly unique, and cannot be copied by your competitors. For leaders, understanding culture helps align the behaviour of teams with the company’s goals, ensuring that your strategy doesn’t just exist on paper but is actively driven by your people.
In large organisations, culture is even more important as different departments or regions can develop subcultures that may either support or conflict with broader company objectives.
By assessing company culture regularly, you not only gain insights into what drives your organisation and to which direction, but also identify gaps between the current state and the culture that best supports your strategy. This data-driven approach helps you take targeted action to refine and improve the culture, ultimately leading to better business outcomes .
Measuring company culture gives leadership the ability to actively steer the organisation in a direction that aligns with its strategic goals, fostering long-term success.
How it works: Surveys are one of the most scalable methods to gather employee perceptions about the organisation’s culture, leadership, and values. They often provide insights into areas like collaboration, trust, and innovation.
Challenge: Employee surveys can suffer from biases if the survey design is not carefully constructed. How exactly these biases twist the results depends on the problems the survey has.
How it works: Focus groups offer a more qualitative approach, allowing employees to openly discuss their experiences and give deeper insights into the cultural climate.
Challenge: These sessions can be dominated by outspoken participants, and quieter employees may hold back, leading to an incomplete picture of the culture even within the focus group. Furthermore, the people selected for the focus group might not accurately represent the company and its culture. It also tends to be rather time intensive, and as such cost prohibitive
How it works: Exit interviews provide candid feedback from departing employees who may feel more comfortable sharing honest opinions. This helps to reveal underlying cultural issues that may not be evident to those still in the company.
Challenge: Exit interviews provide information from those who chose to leave, which can be extremely valuable. However, it is also feedback from a very selected group of people, not to mention that it is people who are not going to be working for the company. Thus, the feedback can be very insightful, but also does not accurately reflect the current state of the organisation, as the feedback is given by people who don’t work there anymore.
How it works: KPIs such as employee retention rates, engagement scores, and productivity levels offer quantitative insights into cultural health.These metrics help link culture with business outcomes.
Challenge: KPIs only reflect the results of the culture rather than depict the culture itself. For example, a drop in productivity may signal cultural issues, but it could also be a technical issue or even an external factor like a change in market or legislation. Without further analysis, it’s difficult to pinpoint the exact problem.
How it works: HR analytics tools track various employee-related data such as absenteeism, promotion rates, and engagement trends. These tools help identify patterns that may correlate with cultural strengths or weaknesses.
Challenge: While HR analytics tools can provide valuable insights, interpreting the data can be tricky. For example, absenteeism might be viewed as a negative sign of disengagement or poor work ethic, but it can also indicate a positive cultural trend, such as employees feeling safe enough to prioritise their health and stay home when ill. Additionally, cultural context plays a significant role— in some cultures, maintaining a strict work-life balance is seen as positive, with taking time off being actively encouraged. In other cultures, working through illness may be considered a sign of dedication and strength, and taking a holiday might signal that you’re simply not working very hard. Without understanding these cultural nuances, HR data can easily be misinterpreted in a multicultural environment.
Among these commonly used methods, we continue to recommend conducting a comprehensive employee survey. While it's true that surveys can encounter issues like bias, there are effective ways to mitigate them. You can read more about how we address this challenge below. However, please note that our approach involves several nuanced steps, so the explanation may get a bit wordy. If you'd prefer a more direct conversation, feel free to contact us to discuss this further.
When measuring Organisational Culture, it's essential to engage a large portion of the workforce. While the specific rate can vary depending on the size of the company and its structural hierarchy, a response rate of 80% is far more insightful than 60%. This is because higher participation ensures that the data reflects the true culture, rather than just the voices of a small or unrepresentative group. The issue with low response rates isn’t just about sample size; it's that those who don’t participate often share common traits, like frustration with the company or lack of time, which leads to inaccurate results.
For larger organisations, including multinational companies with complex hierarchies, gathering responses across departments, regions, and levels is critical. The more comprehensive the data, the clearer the picture of how culture is experienced throughout the organisation.
High participation allows for a more nuanced understanding of the culture, revealing discrepancies between how leadership perceives the culture and how it's felt on the front lines, as well as between different departments, geographical locations, teams, etc. This comprehensive approach ensures that you aren't overlooking critical cultural dynamics that could affect engagement, productivity, or alignment with company values.
Benchmarking plays a crucial role in understanding your company's organisational culture in a broader context. Rather than evaluating employee feedback in isolation, benchmarking allows you to compare how your workforce’s experiences align with others in similar industries or roles. This approach helps you identify patterns and trends within your specific context, providing a more accurate picture of your culture.
It is important to remember that benchmarking should only be used to assess whether the trends identified align with those in the industry, and the functions in which your team operates. Trying to implement “the Netflix” culture simply doesn’t make sense, as culture is a function of strategy execution. Your culture should enable you to execute your strategy.
Our approach stands apart from traditional methods, offering deeper insights and greater accuracy when assessing Organisational Culture. Here’s why:
Minimising Bias: Standard surveys often apply some form of likert scale questionnaire, where the respondent can either fully or partially agree or disagree with a statement. This approach is prone to biases. An employee who is generally favourable towards the company often has a tendency to answer most things favourably (or vice versa). For example, let’s look at the following statement:
Someone who generally likes their work is more likely to choose “Strongly agree”.
However, if you ask them to choose which one they agree with more:
You are more likely to get a less biased reflection of the actual culture of the workplace, as you are asked for an observation.
Avoiding Cultural Skew: National cultural tendencies often influence how people answer surveys. In some cultures, respondents are more likely to choose options that are worded more assertively, often strongly agreeing or disagreeing with almost every statement. In other cultures, however, it is typical to lean towards middle-ground answers, and almost never strongly agree or disagree with any of the statements. This skews data in traditional surveys, leading to inaccurate results. Our approach accounts for these cultural differences, ensuring the data reflects true employee sentiments rather than cultural habits.
Integration of National Culture: We understand that employees’ national culture is deeply intertwined with their workplace values and attitudes. Our benchmarking includes specific elements that factor in national cultural dimensions, recognising that the underlying values from national culture significantly impact how employees perceive their workplace. This allows for a more holistic understanding of your company’s culture, ensuring it aligns with both employee values and business goals.
Contextualised Industry Comparisons: We don’t just compare your company against others on a surface level. Instead, we focus on how your employees’ experiences align with relevant industry peers in similar roles. This avoids irrelevant comparisons (such as comparisons between industries like marketing and mining), ensuring that the insights you gain are actionable and meaningful within your specific context.
Actionable Insights for Sustainable Change: By offering a more accurate and nuanced picture of your culture, we provide data that is not only insightful but also directly tied to actionable outcomes. The depth of our analysis ensures that any cultural adjustments you make will be grounded in a sustainable approach, taking into account both employee values and industry benchmarks.
These unique features make our approach the best choice for organisations looking to gain a clear, unbiased, and comprehensive understanding of their culture and how it aligns with broader industry trends and internal goals, specifically in any organisation that employs people from a variety of cultural backgrounds.
So far, we've covered how to measure your company culture, and you now have a clear understanding of where your culture stands. But the natural next question is: what do you do with this data? How can you transform these insights into meaningful action?
The key is to analyse the gaps between your current culture and the ideal culture your leadership team envisions. This involves three steps:
Understanding your current culture, and desired culture: Use the data you’ve gathered to get a clear picture of how things really are and how people would ideally want them to be.
Identifying the gaps: Compare your current culture with the culture you need to meet your strategic goals, and the culture your employees would like to have. This could highlight areas like trust, communication, or collaboration, which are consciously or unconsciously major obstacles
Creating a plan for change: Based on the identified gaps, create a roadmap to address the most critical areas where your current culture doesn’t support your objectives, or is likely to create strong emotional resistance
If you’re ready to take the next step toward cultural transformation, our Organisational Culture Transformation Package is designed specifically to guide you through the process. Whether you need help identifying gaps or developing a strategic plan for cultural change, we’re here to assist you.
If you're just looking to learn more, you can read more about the package, as well as the process itself, here. If you’re ready to align your culture with your company’s strategic goals, do not hesitate to contact us!