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People Management

Why Company Culture Directly Impacts Employee Engagement

March 25, 2022
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4 mins

Company culture and employee engagement determine whether your employees will stay motivated and loyal to your company. Here's how the two are connected.

Linda Le Phan
Company culture and employee engagement determine whether your employees will stay motivated and loyal to your company. Here's how the two are connected.

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Your company culture, or organizational culture, is your company’s shared ethos that was established by leadership. It’s a combination of the habits, behaviors, and values that define  your organization. 

While there’s no such thing as perfect company culture, but cultivating a positive one directly impacts employee engagement and ultimately determines whether your employees will stay motivated and loyal to your company. We’ll explore why that is.

What’s the relationship between culture and engagement?

Employees work best in an environment where they feel supported, encouraged, and inspired. And since the average person spends one third of their life at work, employers owe it to their employees to foster a work culture that they want to be a part of.

We highlight the relationship between company culture and employee engagement, along with examples of how to effectively apply them to your organization. 

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1. Culture shows how much your company cares

Favoritism, poor communication, impossible goals, lack of appreciation: these are all examples of poor conditions that push employees away. If these workplace issues exist in your organization, that’s a big sign that your company culture needs improvement. 

However, an even bigger indicator of your company culture is your company’s reaction — or indifference — to these issues. 

A negative work culture is one that ignores or promotes these issues. Failure to fix critical workplace issues like these directly impacts employee engagement because employees will quickly realize that your company doesn’t have their best interest at heart. The result is a workforce that’s resentful, burned out, and completely checked out over time. 

Martijn Vollmuller, CPO of Epos Now, finds that offering various means of support to employees is an effective way to shape your company culture and improve employee engagement.

“We’re constantly looking for ways to improve employee engagement, and we’ve found that several things work well for us. Firstly, we make sure that employees feel valued and appreciated and that their well-being is considered. We do this by offering a range of flexible working options, a good benefits package, and regular communication. Plus, our employees have access to a virtual platform that gives them access to free counseling, fitness and wellness classes, and financial literacy classes.”

2. Your culture represents your values 

Look at any company’s mission and values statements and you’ll find that many aspire to promote collaboration, trust, innovation, integrity, compassion, among other admirable qualities. But naming these qualities as your company’s core values doesn’t guarantee that your company culture will live up to them. 

That’s because the formal systems you create and the informal behaviors you permit in your organization feed your culture and reveal the actual values present in it. 

For example, say it’s typical for individuals in your company to often withhold criticism, avoid conflict at all costs, and sugar-coat the truth to “keep the peace.” Honesty is not a value in a company culture like this and, as a result, employees who feel strongly about honesty will likely become disengaged.  

While everyone contributes to the systems and behaviors in your culture, it’s up to your organization’s leaders to guide and enforce the values that matter. 

Here are some ways to ensure the values you intend to promote are actually reflected in your company culture:

  • Communicate values in the onboarding process and how each person’s job supports the company’s overall mission.
  • Regularly recognize and reward team members for living up to company values.
  • Set company-wide or department OKRs that directly support your values.
  • Conduct employee surveys or daily check-ins with Kona and be receptive to employee feedback.

Vollmuller is a fan of conducting surveys regularly to get to the root of employees’ experiences:

“Speaking to and understanding our employees’ feelings and perceptions is critical to our success as a company. We survey our employees every quarter to get their feedback on a variety of topics, from their job satisfaction to the effectiveness of our communications. This helps us identify areas that need improvement and keep track of our progress.”

He adds that face-to-face conversations are especially valuable to uncover your company culture’s blindspots while also building a connection between employees and company leadership. 

“As well as surveying employees, we also hold monthly meetings where employees can ask questions directly to our CEO and other leaders. This gives employees a sense of ownership and connection to the company and lets us get feedback on things that may not come up in surveys.”

3. Culture and engagement are constantly changing 

Every business goes through ebbs and flows. Fluctuations in personnel, customers, product, competitors, and industry are inevitable and force you to stay on your toes. Your response to these changes determines your company’s success, and it also impacts your company culture and engagement. 

For example, things like losing your biggest customer, experiencing a product outage, getting copied by a competitor, or suffering from high employee turnover don’t happen frequently. But when they do, they change your culture and how your employees feel in their work environment. 

There are two key takeaways from this you can apply to your own culture. First, recognize that your whole company is on the hook to nurture culture and engagement — not just HR. 

Second, improving your culture and engagement requires a holistic view of your company and how your employees feel throughout different seasons. 

Julie Thorne, People & Culture Manager of NorthOne applies this broad view to how and when she approaches engagement surveys and what data she looks for in them. 

“We are constantly surveying employees. We send out anonymous engagement surveys every quarter to every member of our team (over 100 employees). We also alternate between a quick check-in survey and a longer, more in-depth assessment of their engagement...[looking] at various categories that make up the employee experience, with engagement being one. But we also review company confidence, innovation, management, and work/life blend, to name a few.”

The most successful organizations make regular investments in culture to see the benefits of a more engaged workforce. By taking to heart these three truths and applying them, you’ll be better equipped to foster a company culture that your employees will not only be more engaged in but also thrive in and enjoy. 

Meet the Author

Linda Le Phan

Linda is a Boston-based content writer with 10 years of experience crafting content for human-centric B2B brands. She covers topics like remote work, productivity, recruitment, mental health, and more. Her goal is to promote transparency, empathy, and honest introspection within companies and their leaders.

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