The Link between Engagement and Company Culture

Employee Engagement and Company Culture
The link between engagement and company culture is undeniable. We define culture as the underlying patterns of how work actually gets done in an organization. Employee engagement, on the other hand, reflects the depth of employees’ mental and emotional commitment to their workplace.

It’s important to be precise: engagement is not synonymous with happiness, satisfaction, or well-being, just as culture is not the same as engagement. Each operates on a distinct level, yet both are critical to organizational performance.

Why Engagement and Culture Matter
Employees who are engaged, clearly understand their roles, and have positive relationships with their managers are two to four times more productive than their peers — and half as likely to be considering leaving.

Our research on organizational alignment shows that healthy, strategically aligned cultures account for 40% of the performance gap between high- and low-performing organizations, influencing revenue growth, profitability, customer retention, leadership effectiveness, and employee engagement. Organizations that combine cultural alignment with high trust deliver 286% greater value to stakeholders than those with low trust.

The Link between Engagement and Company Culture
There is a strong link between engagement and company culture.  We believe that there are three levels of a company culture that have a direct link to employee engagement.

• Organizational Health
  Organizational health can be assessed through employee well-being, operational effectiveness, adaptability, growth opportunities, and efficient use of resources. This is precisely where employee engagement intersects with company culture.

  Every company aspires to be healthy, and every employee wants to contribute to a thriving organization. A strong organizational health framework lays the foundation for high performance by actively fostering engagement at every level.

• High Performance Environment
  The second level of culture focuses on maximizing the potential of your peoples once a strong foundation of organizational health is established. Leaders are responsible for creating the conditions that consistently enable employees to perform at their best — aligned with the organization’s core values, behaviors, and strategic objectives.

  High performance cultures set clear expectations, apply fair and transparent performance measurement, and foster meaningful motivation to excel. Sustaining high performance is nearly impossible without an engaged workforce.

• Strategic Alignment
  The third level of culture evaluates how closely your organizational culture aligns with your business strategy. In our experience, strategies often falter because underlying belief systems — sometimes fragmented, hidden, or misaligned — shape how employees interpret and act on strategic goals and daily tasks.

  When these beliefs are overly complex or conflicting, they can significantly hinder strategic progress. Changing these underlying mindsets is challenging without a foundation of strong employee engagement.

Four Steps to Achieve Higher Levels of Employee Engagement
Without strong organizational health and high employee engagement, building a high-performing, strategically aligned culture is extremely difficult. Once you have thoroughly assessed your company culture, take these four steps to establish a foundation that drives both employee success and business results.

1. Identify the Role Engagement and Retention Play in Your People and Business Strategies
   Ambiguity is your enemy here. Be crystal clear about the relative importance of engaging and retaining top talent compared to the other strategic initiatives on your plate.  This will set the stage for the next three moves.
2. Focus on Implementation First, Then Assess Engagement
   Ensure that you have the desire, time, and ability to take meaningful action from employee engagement survey results. Too often companies jump first to selecting “the right engagement survey” without thinking through the strategy, culture, and talent implications of the potential actions required to measurably improve employee engagement.
3. Use an Engagement Survey that Provides Strategic Insight and Enables Immediate Action
   While they may be good for a consultant’s bottom line, standardized or abbreviated engagement surveys typically provide leaders less than half the information needed to make decisions and take action. The key is to use a validated and customizable engagement survey that is action-driven rather than curiosity-driven.
4. Make an Employee Engagement and Retention Index a Key Performance Indicator
   Your engagement index is the equivalent of your company’s market capitalization for your employees, and it should be used to evaluate all human capital programs looking to improve employee advocacy, discretionary effort, and retention.  If engagement truly matters to you business, hold your people and project managers accountable for nurturing it.

The Bottom Line
A high-performing, strategically aligned culture goes hand in hand with a proactively engaged workforce. Culture provides the foundation for both engagement and organizational health — essentially the “ticket to play” in any organization that aims to perform at its best.

If you want to learn about research-backed ways to improve employee engagement, download The Top 10 Most Powerful Ways to Boost Engagement