Organizational Culture: 10 Common Myths and Facts

The importance of culture in business is no longer an avenue for discussion. Every business in existence perfectly accepts and understands that organizational culture is a critical pillar of its success. 

There’s just one problem. The idea of organizational culture is highly nuanced because most business leaders define it differently. 

For some, they abide by one of Aristotle’s most popular ancient teachings which says “we are what we do.”  In the context of organizational culture, they believe it’s the consistently observable behavior of each constituent within a company. 

Other entrepreneurs define culture as a product of compensation. Every perk, benefit, incentive, monetary compensation, and non-monetary value you offer adds up to create one’s organizational culture

The rest see it as the unspoken normative values, ethical principles, and unique rituals that pervade and bond the company.

Each concept is an incomplete perspective but offers valuable nuggets to describe the holistic and complete definition of organizational culture

Culture is the summation of who you are, what you say, and what you do. In other words, organizational culture is: 

  • What your employees experience within your company.
  • What you promise in your messaging and communication affairs.
  • What your customers experience in every interaction.

Protecting and defending a happy, healthy, wealthy organizational culture is critical to business success. Despite this, there are many myths and misconceptions about what organizational culture actually is. In this article, we dispel 10 of the most common organizational culture facts and myths. Keep reading.

Why Organizational Culture Is Becoming Even More Important

Organizational culture is not a publicity stunt or some PR booster to make your company look good. It is important to be aware of culture because there are monetary implications and ramifications, depending on a business’s culture. Companies will reap the benefits or feel the sting of their organizational culture in their bottom line.

According to AP News, businesses with healthy cultures are 150 percent more likely to grow revenue by 15 percent within 3 years. Furthermore, they are 2.5 times more likely to experience significant stock growth during the same period.

However, only a measly 31 percent of HR leaders believe organizational culture to be necessary for future business.

The thing is: there’s no easy way to describe, measure, consume and implement organizational culture.

Unlike other metrics like budget forecasting, technical training, and tangible policies, these are more manageable to establish and follow. Organizational culture, on the other hand, is abstract in nature but ethereal in relevance. Even if your company crafts the perfect business-running formula, success in onboarding talents or being profitable is never a certainty. That’s why companies are turning to culture for a solution.

Organizational culture, then, can make or break the success of your business. If you want to develop the best culture in your organization, the Wizard of Sales® can help you achieve this. Book a call with Ryan Chute from Wizard of Ads™and let’s make your happy, healthy, and wealthy culture a reality.

“To put it simply, your culture is your brand.” – Ryan Chute

The 10 Most Common Organizational Culture Myths and Facts

1. High-paying companies have a positive company culture

Verdict: FACT

Your organizational culture must always hit the magical trifecta, which is being happy, healthy, and wealthy. You can’t take wealth out of the workplace, because let’s face it, your employees are looking to profit, just as much as you are. 

Always keep in mind that it’s your employees that drive your business forward. If their income impacts their stability, their productivity drops. In other words, your company’s success is linked to your employees’ morale. And their morale is affected (in part) by their pay. 

Higher income incentivize employees, compelling them to exert extra effort and engage more actively in word-of-mouth recruitment. Finally, high income propogate better employee retention rates and inspire increased attention to their work.

All of these benefits play a part in establishing a positive organizational culture.

“Top talent requires top pay.” – Ryan Chute

2. Work-life balance is essential for a great company culture

Verdict: FACT

Work-life balance can often feel like a myth for HVAC techs and plumbers in the US. 

According to Apollo Technical, 94 percent of service workers in the service industry work more than 50 hours per week. That is a very alarming statistic considering work-life imbalance can lead to burnout which affects the quality of work rendered. Deloitte says, 77 percent of employees experienced burnout on the job with more than half saying it occurred twice.

Even if employees are compensated for any extra hours they render, taking away their personal time has repercussions. Their well-being suffers, productivity plummets, and employee turnover spikes. Moreover, the economy loses $190 billion in healthcare expenses from burnout.

A good organizational culture is a healthy culture. If your employees’ health suffers, so does your business.

The best culture is often found in tech companies

3. The best culture is often found in tech companies

Verdict: FACT

The tech industry is unrivaled and has been the bearer of buzzwords like innovation, agility, and execution. But is their fast-paced product-oriented culture also better than other industries? Research says yes. This is according to Jostle’s analysis of over 10 thousand data points from Glassdoor and MIT’s Culture 500.

Tech companies have better Culture and Values ratings compared to other companies. They also outperform other industries in 6 out of 9 essential parameters. These are agility, collaboration, execution, innovation, performance, and respect. The only categories wherein they fell short were customer, diversity, and integrity.

Plus, there are also other elements that may influence their superior organizational culture. For example, they’re compensated very well and they can work remotely.

4. Great Organizational culture begins at the top

Verdict: FACT

Culture always begins with the business owner. Everything you believe in, and more importantly, the things you tolerate will shape your overall organizational culture. There’s a high probability that a toxic work culture is most influenced by what the leader tolerates. Alternatively, a CEO who practices and enforces a positive company culture will also flow through everyone in the organization.

According to Forbes, there’s one common theme among companies with great cultures: clear values and goals.

When you repeatedly inculcate and practice positive values to the team, a remarkable organizational culture follows. Here are tips for CEOs and business owners:

    • Build trust throughout the organization
    • Implement “culture” talks where everyone’s voices and concerns are heard
    • Establish a growth coaching strategy
    • Create a safe space for everyone
    • Onboard talents who naturally share the company’s culture

5. Building a strong culture takes time

Verdict: FACT

Did you know that only 15 percent of companies managed to effectively transform their organizational culture for the better? This is according to the Institute for Corporate Productivity’s study called Culture Renovation: A Blueprint for Action.

Doing a full 180 on any company culture takes time. If it’s true that it takes 21 days to develop a habit, it will take longer than that for companies. The speed of building the desired culture will depend entirely on the efforts you’re making as a business leader. For example, Microsoft managed to improve theirs in a matter of months thanks to the efforts of Satya Nadella.

Employees are most concerned with trendy perks and benefits6. Employees are most concerned with trendy perks and benefits

Verdict: MYTH

Trendy perks and unique benefits are taking the world by storm. You see ping-pong tables, yoga sessions and sometimes workplaces have a happy hour for their employees. However, no amount of nap time can beat the most important and actually useful benefits in the company. 

According to Glassdoor, the top 5 benefit types that employees want are:

    1.  Health Insurance
    2. Vacation and Paid Time Off
    3. Pension Plan
    4.  401k Plan
    5.  Retirement Plan

These are the things that truly make employees feel stable and protected. When you prioritize your people’s mental health, you protect and defend a happy and healthy organizational culture.

7. Older businesses have a better culture than new businesses

Verdict: MYTH

Older businesses have always settled for the bare minimum they could give employees. But that’s no longer the case today. With many more people opening their eyes to the horrors of a bad organizational culture, there’s been a paradigm shift. 

CNBC reports that more Millennials and Gen Z are choosing culture over higher salaries. Moreover, a majority of them will not work for a company that doesn’t align with their values. 

What does this entail?

This will force older businesses that have stuck with a bare minimum organizational culture to embrace radical change. Meanwhile, newer businesses that are at par with younger generations are more likely to have better cultures.

8. Company culture and employee performance are not linked

Verdict: MYTH

The notion that organizational culture only exists to make employees feel comfortable is wrong.

In fact, organizational culture can have a direct impact on employee productivity and motivation. This can affect an employee’s willingness to go above and beyond their job duties. A survey done by the Institute for Corporate Productivity of over 200 organizations proved this notion. 

The researchers found that a positive organizational culture was associated with employees who were more likely to:

    • Support coworkers
    • Give extra effort
    • Take on additional assignments

9. Culture doesn’t matter at all

Verdict: MYTH

If there was one thing the previous discussions have proven, it’s that organizational culture matters. While it may not be the most important factor in organizational success, it still plays a significant role. 

This myth is perpetrated by years of growth, profits, and revenue. When you’re making money, the ego takes over and insists that culture is irrelevant. Fortunately, these medieval tactics are making way for more modern and purposeful cultures that serve those that serve others. 

This was emphasized in the global survey of over one thousand CEOs and senior executives by IBM. Organizational culture was cited as the number one reason why companies fail to achieve their transformation goals.

the sum of pay and benefits is the culture10. The sum of pay and benefits is the culture

Verdict: MYTH

Organizational culture is more than the tangible benefits of an organization. Monetary compensation is part of the cultural trifecta, but they’re never the only aspect that matters. Overall, the majority of company culture deals with who you are or how your employees view you as a business. Moreover, it also encompasses what you do or your company’s primary role and what you say or your brand messaging.

Organizational culture is what sets your company apart from others and shapes the way employees behave.

Workplace organizational culture is vital to the success of any business. By understanding the common myths and facts, you can adjust and align your company’s culture in the right direction accordingly.

If your company culture needs a 180-degree spin, Wizard of Sales® is more than happy to help you out. Together, let’s protect and defend a happy, healthy, and wealthy culture. Book a call.