How Culture and Employee Engagement are Linked

Culture and Employee Engagement are Linked

We know from assessing organizational cultures that corporate culture and employee engagement are two pieces of a puzzle that fit perfectly together and are not complete without the other. If you want higher performance, culture and employee engagement are a great place to start.

Organizational Culture
Let’s start with organizational culture. While different pockets of culture can exist in various teams and geographies within a company, we think of organizational culture as a company-wide construct. It is “The Way” things truly get done on a day-to-day basis.

Organizational culture is made up of the behaviors and practices of the company as a whole. It includes the known and unspoken corporate values, beliefs, and assumptions that underlie how and why things get done. Organizational culture represents the team norms that define how employees behave and what they believe.

Culture and Performance
And, in terms of performance, organizational culture matters. Our organizational alignment research found that corporate culture accounts for 40% of the difference between high and low performing organizations in terms of profitable revenue growth, customer retention, leadership effectiveness, and employee engagement.

Employee Engagement Is About Organizational Health
We believe that measuring and improving employee engagement is a powerful talent management tool to help attract, develop, engage and retain top talent. We think of employee engagement as looking at an individual employee’s level of advocacy, discretionary effort, and intent to stay. Employee engagement surveys typically help leaders and managers understand how their individual employees feel about their work situation.

And while engagement certainly provides a perspective about the impact organizational health has on employee’s attitudes toward their job, we do not believe that employee engagement surveys fully measure cultural effectiveness. We see high levels of employee engagement as an outcome of a healthy organizational culture, not the cause.

Employee Engagement and Performance
Like workplace culture, employee engagement also matters in terms of business performance. On average, highly engaged employees create 18% greater productivity, 12% higher customer satisfaction, and 51% less voluntary turnover.

How Does Culture and Employee Engagement Fit Together?
Through our work with clients in the field of high performance cultures, we have found that stronger organizational cultures also have a highly engaged workforce. And we have identified three cultural components that have the highest correlation to higher levels of employee engagement:

1. Alignment with Goals
High performance companies ensure that their culture is aligned with their strategic priorities.  You will know alignment with goals is happening when employees:

• Understand the company’s plans for future success
• Believe the organization will be successful in the future
• Can articulate how their job helps the organization achieve success
• Know how they fit into the organization’s future plans

2. Trust in Senior Leaders
Trust is the foundation for any healthy organizational culture.  You will know healthy levels of leadership trust are happening when employees:

• Trust the leaders are setting the right course
• Believe the senior leadership team is up for the task of leading the company to future success
• Feel the leaders are honest, trustworthy, and demonstrate integrity

3. Feeling Valued
When employees feel valued, their engagement and productivity rise, and they are motivated to do their jobs better.  You will know employees feel valued enough when they:

• See meaningful investments being made to make employees more successful
• Feel valued as the company’s most important resource
• Are rewarded and recognized proportionately for contributing to the organization’s success
• Believe that leaders are committed to making it a great place to work

The Bottom Line
When you have a culture that supports your strategy and employees who are fully engaged, you have a winning combination that is hard for your competitors to replicate.

To learn more about culture and employee engagement, download the latest Employee Engagement and Retention Toolkit Now