Why and how culture drives performance
According to organisational consulting firm Korn Ferry, almost two-thirds of executives at the world’s leading organisations attribute 30% of their companies’ market value to one thing: culture.
Often seen as a bit of a nebulous concept, it’s clear that culture is increasingly becoming a vital driver of performance, with many execs citing it as the most underrated factor in organisational success. But it’s also something that can be very hard to get right. You can’t just create a great culture overnight!
A positive culture aligns employees with a shared mission and values, creating a sense of purpose that drives motivation and dedication. When employees feel connected to the company's goals and values, they are more likely to go above and beyond in their work. But this connection needs to be authentic; people have to believe in that mission, and everyone, from the CEO down, needs to live those values.
What defines a great culture?
A strong culture fosters an environment where communication and collaboration are the norm. This openness leads to better problem-solving, faster decision-making, and more efficiency.
When teams trust each other and feel comfortable sharing ideas, innovation flourishes, and the organisation can adapt quickly to changes and challenges. And trust needs to come from the top if everyone is to feel empowered to share their ideas and do their best work.
A supportive, inclusive culture that prioritises work-life balance, recognition, and professional development leads to higher job satisfaction. Satisfied employees are more engaged, loyal, and less likely to experience burnout, which in turn lowers turnover and boosts overall performance. Leaders should role-model good behaviours in order to set the cultural tone for everyone.
Cultures that value continuous learning encourage employees to develop new skills and grow within the organisation. This investment in development not only enhances individual performance but also contributes to the company’s long-term success.
Again the commitment to a continuous learning culture needs to come from everyone. If those at the top feel they are ‘beyond’ learning new things, then they will undermine the growth mindset of the organisation as a whole.
The culture challenge
While many organisations understand why they create a great culture, the reality is that day-to-day pressures and challenges can undermine attempts to put the right foundations in place. Yet again, the buck stops here with the leaders that need to enforce the purpose and values organisations seek to embody.
But, according to Gartner, there’s a disconnect between the expectations heaped on leaders and the development support they receive, with only 36% of HR leaders believing current leadership development programs are effective in preparing leaders for future challenges, including embedding culture into values, behaviours and processes.
So to really create authentic, engaging cultures, leaders not only have to be empowered to own and role model the desired culture, but they also need to be supported to do so. Focusing on development programs that hero the importance of human connection and collaboration - particularly between peers - help embed the behaviours that are required to truly bring great cultures to life.
Ultimately, a great company culture is built on respect, trust, and a shared sense of purpose. It requires consistency, commitment, and a genuine effort to make work meaningful for everyone.
