How to measure company culture

Why it’s important to measure company culture

Before the importance of company culture can be captured, it must first be defined.

William Craig, the founder and president of WebFX, said company culture is “pre-existing in your company's genetic code; it’s not something that employees bring with them.” It’s an intangible and collective sentiment about a work environment shared by employees of every level.

Frederic Kerrest, the COO of Okta, said, “It’s the reason employees love or hate their jobs, or customers can feel valued or ignored. Like reputation, it takes years to build a good culture, but only a few missteps to mess it all up.” These different perspectives help capture not only the function of company culture but also the urgency that companies must start to consider their own.

Company culture ultimately deserves attention because it will help your business:

• Attract new, talented employees.
• Keep your current employees engaged and motivated.
• Produce its best possible work.
• Earn a positive reputation for future employees and prospective clients.

What a business should do to measure its culture

Culture is much different than morale. A company’s morale is — or at least, should be —much more irregular or unpredictable than a company’s culture, because the emotions or feelings of employees can be affected much more from external sources.

For example, a company will likely experience a higher sense of morale during the holiday months when families are celebrating and more events are taking place than, say, February. Company culture is different, though, because it captures much more of the institutional and systematic choices your business engages in with its employees. Company culture is a long-term concept, which is why monitoring it is essential.

Company culture quantifiers should base their studies on three primary metrics: communication, retention, and performance.

• How to measure communication: Cultivate a model of open communication. Measuring it, however, can be tricky. A third-party consulting service can help determine what works and what doesn’t from employees directly. It offers a degree of separation from management that allows employees to be more honest and candid than they would in other environments.
• How to measure retention: Apply turnover information and retention statistics to culture evaluations. If new hires are leaving too early, culture may not be catering to newer employee expectations and needs.
• How to measure performance: Which tasks do employees complete and don’t complete? Those key performance indicators (KPIs) are key metrics for success. Combine metrics with insights from managers and leaders to determine overall performance.

How to improve company culture based on the results

Now that a company has charted key indicators of organizational culture, it should look toward problem areas for improvement. One first step is with active listening across-the-board. It can improve employees’ experiences dramatically, impacting the overall work culture at the company.

Another remedy to company cultural problems, particularly with retention, could be to implement an overarching team-based model for the sake of inclusivity. Arianna Huffington, the founder of Huffington Post, wrote that team-oriented models “build empathy, foster creativity and strengthen resilience” among employees. Introducing new hires to a dedicated and supportive team will significantly strengthen their chances of staying on, and it lowers a company's turnover rate.

Other methods can help improve company culture. With an online MBA program, you’ll be prepared for the next step in your career by focusing on fundamental managerial topics, including business communication, research methods, and statistical analysis.

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