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Workplace Culture: What It Is and Why It's Important For Your Business


8 min read

Workplace Culture

Outsourced Bookkeeping and Accounting Costs


The Great Resignation, The Big Quit, or the Great Reshuffle- whatever you choose to call it- continues to roll.

Key Takeaways


With businesses caught in the middle of turnover turmoil, with an average of 4 million workers quitting their jobs every month, employee resignations are at an all-time high [1]

These high turnover rates are exceptionally costly for businesses in terms of direct costs, indirect expenses, client satisfaction, and diminishing employee morale. 

A recent survey from the Pew Research Center looked at the reasons why employees decided to leave their jobs in 2021. Among the top reasons cited were low pay, no opportunities for advancement, and feeling disrespected in the workplace. Additional top reasons workers mentioned included childcare issues, little workday flexibility, poor benefits, wanting to move to a different area, working too many hours, working too few hours, and not wanting to comply with a company's COVID-19 vaccination requirements [2].

Spending too much time in the back office and not enough time leading?  That’s not why you started your business… Click Here To Fix It. 

Although they might seem like disconnected issues, each of the reasons that former employees listed for choosing to quit their jobs has roots in workplace culture, and improvements in workplace culture could effectively improve all of the issues that employees have with their current jobs. 

What Is Workplace Culture?

Workplace culture can be defined as the personality or character of a business or organization. The culture makes your company feel unique. Culture is defined by a business's core values, beliefs, traditions, attitudes, interactions, and behaviors. 

The quality of a company's workplace culture can mean the difference between having an enjoyable and fulfilling workplace, a so-so workplace, or a toxic and stressful workplace. 

Why Is Workplace Culture So Important?

Workplace culture is essential to business success for several reasons. 

  • Your workplace culture can either strengthen or weaken your business objectives, strategies, and goals.
  • A positive culture that is communicated well attracts top talent that is also a good fit for your business. 
  • Workplace culture affects the way employees interact with your business and handle their work. Positive culture drives employee engagement. 
  • Workplace culture has a direct impact on employee turnover rates because highly engaged employees are less likely to quit their jobs.
  • High engagement also correlates with increased productivity.
  • Good workplace culture improves employee happiness and satisfaction. 
  • Businesses with positive, strong workplace cultures outperform the competition in terms of both financial and general success. 

As you can see, workplace culture can mean the difference between running a successful business and struggling month to month to keep your company staffed and your doors open. As a result, it is essential that business leaders take control of their company culture because failing to define culture, leaving it up to chance, and hoping a positive workplace culture will form organically would be a dire mistake.

Read More: How to Build a Successful Company Culture Committee

Positive workplace cultures don't just happen. They don't just form out of thin air. They are intentionally created, cultivated, and constantly nurtured to ensure high employee retention, satisfaction, happiness, engagement, performance, and productivity. 

Understanding What Defines Culture in Your Workplace and Taking Control

Now that you understand what workplace culture is and why it's essential to your business, you need to understand what impacts culture so that you can take control. The short answer is that everything impacts your company culture. However, there are certain factors that are within your control that also have a powerful effect on the type of culture that forms in your company. 

Core Values, Mission, and Vision

From the very start, your business (and all of its operations) should be based on a set of core values and beliefs that help to shape its mission, vision, and the strategy that you use to reach those goals. These values should be widely, clearly, and consistently communicated. Plus, your values should be infused into every single process, policy, procedure, and strategy.  

Is it time to reassess your core values?

David Snyder shares how his workplace culture shifted when he  adapted a PEOPLE FIRST mission.



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Leadership and Management

Leadership styles and management practices have an enormous impact on workplace culture. Consider the following:

  • How leaders interact and communicate with employees
  • The nature of what is communicated and emphasized (i.e. What do you value?) 
  • Your future vision
  • What beliefs or perceptions are reinforced by your leadership?
  • What does leadership celebrate, reward, and recognize?
  • What does leadership expect from employees?
  • How do your leaders handle failure?
  • How do you make decisions?
  • How is your organization structured and managed?
  • Does management empower or micromanage employees?
  • Is management supportive?
  • Are they consistent?

Each of these factors defines the leadership style of your business. Focusing on leadership is, perhaps, the most powerful way to impact culture. Lead by example and the culture you want will follow. 

Workplace Practices and Processes

The positive impact of saying you want to define a certain type of culture and acting with a positive leadership style can be completely undone if your official workplace practices and policies counteract a positive culture. This includes your recruiting, hiring, and onboarding processes in addition to your policies for rewards, recognition, compensation, and benefits. Additionally, you need to establish sound policies that provide opportunities for employee training, professional development, internal hiring, and promotions. 

Read More: Improve Workplace Productivity and Employee Teamwork With DISC Training

Your policies and practices should also help to foster a healthy work/life balance for your employees including paid leave or time off. Additionally, consider how you can make your workplace more flexible with flexible hours or a hybrid office model. 

Instituting workplace traditions can also help to strengthen bonds within the workplace, create a sense of belonging, and foster teamwork. For example, celebrating a sale by playing a victory song or ringing a bell. 

Workplace Policies

You should also define policies that align with the workplace culture you want to create. When doing so, consider how you handle attendance, dress code, scheduling, promotions, hiring, compensation, internal job posting, and employee conduct. 

The People

As powerful as a good leadership team and solid management principles can be in the process of shaping workplace culture, the people you hire can have a great effect on culture too. For this reason, it's essential that you hire first for cultural fit and second for credentials. Even if an employee can crush it in terms of sales, if they make everyone around them feel bad, then they poison the workplace environment with a bad attitude. This can result in reduced productivity around them, effectively hurting your culture and negating their own success. 

Read More: How to Hire People Who Won't Quit


Open, honest, and safe communication is essential to a positive workplace culture. Management should communicate freely and transparently with the rest of the organization. This openness builds trust across the company's management hierarchy. Likewise, employees should feel free to offer feedback and suggest their own ideas. Plus, they should feel like they are heard. 

Work Environment

A workplace environment can have a major impact on happiness, comfort, health, and productivity. Be mindful of how you arrange and decorate your professional environment. Carefully consider what types of things you will hang on the walls, whether you'll have live office plants, how you allocate the available workspace, the colors you choose, and the type of lighting. It's also good to have policies in place (that align with core values) regarding what sorts of personal items employees can have on their desks and how the common areas are intended to be used. 

How People Drive Profit [GUIDE] 6 Key Company and People KPIs you need to make  Data-Driven Decisions...

Assess, Change, and Measure the Impact of Your Workplace Culture

Before blindly making changes to the workplace culture, you should assess where your company currently stands. You can do this through observation, but we recommend conducting both exit interviews with employees who leave and staying interviews with current employees. Ask those who are on their way out why they left and what you could have done better.

Ask those who are staying why they work for you, if they are happy working for you, if anything would help them feel happier or more engaged, what they enjoy about the workplace, and what you could improve about the workplace. You can also ask how satisfied they are with various aspects of their jobs, specifically referencing the reasons why people quit their jobs that we mentioned at the beginning of the article. For example, ask them to rate on a scale of one to ten their satisfaction with workplace flexibility. 

Based on the answers you receive, you can make intentional adjustments to your leadership style, management principles, policies, values, etc. to improve the culture in your workplace. 

Next measure the impact of these changes by conducting stay interviews routinely (perhaps, once per quarter) and by measuring metrics related to your people such as employee retention rates and ROI on labor. 

With a solid strategy to actively cultivate a positive workplace culture, you'll begin to build trust, loyalty, and engagement with your employees, making your workplace somewhere your employees want to be and making the jobs you offer highly attractive to the right potential candidates. 

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[1] https://www.shrm.org/resourcesandtools/hr-topics/talent-acquisition/pages/interactive-quits-level-by-year.aspx

[2] https://www.pewresearch.org/fact-tank/2022/03/09/majority-of-workers-who-quit-a-job-in-2021-cite-low-pay-no-opportunities-for-advancement-feeling-disrespected/

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