Why Company Culture Is So Important and How to Recognize a Toxic Work Environment

For employees to believe in their job, their job has to believe in them.

group of people in an office having a business meeting and smiling

Call it a vibe, call it a feeling, but if you walk into an office and the employees look miserable, the company is likely on a fast track to failure. The good news is that if you implement some policies, you can turn things around in no time. Even if you already have a great company culture, there is always room for improvement. 

What is company culture?

Company culture can seem abstract and difficult to define, but simply put, it is the shared values, attitudes, and behaviors in a workplace. It’s a set of core tenets put into action by the employees and management of an organization. It is how conflicts are managed. It is what your business believes in. 

Why does company culture matter?

It can be easy to discount the importance of a healthy work environment. After all, if everyone is getting the job done, it shouldn’t matter if they aren’t happy all the time, right? Work is not about feeling good; it’s about delivering consistent, quality output. 

This kind of mentality is what drives many companies into the ground. 

A great company culture matters because without it, your best team members will leave for greener pastures. According to the MIT Sloan Management Review, a record number of employees in the United States sent in their two weeks’ notice between April and September 2021. We’re talking about millions of people in both white-collar and blue-collar jobs. Though it was originally assumed that workers were quitting over low wages, it turned out that a bigger factor in the Great Resignation was an unhealthy company culture. In fact, survey respondents were ten times as likely to leave their job over toxic company culture as over issues with salary or compensation.

182 founders interviewed so far. Get interviewed in 10 minutes, via a simple form, for free.

Employee retention is paramount for building a successful business. To be the best, you need to not only attract the best but keep them in place. This will enhance productivity, boost your brand reputation, and improve communication between employees and management. A good workplace culture fuels innovation and fosters a sense of community, which can give you quite the edge over your competitors. 

How do I know if my company culture is toxic?

Think back to the worst job you’ve ever had. Maybe it involved intense manual labor, or perhaps you always needed to have your customer service voice at the ready. Even if your terrible job was normal by most standards, there was likely something you couldn’t put your finger on that made you dread going to work every day. The worst jobs can be weathered if the work environment is supportive, but if you don’t have the baseline of care and camaraderie, you won’t wish to pledge your loyalty to the business. 

There are quite a few red flags that indicate a toxic workplace culture. You might be familiar with the more common signs, such as cliques, gossip, and bullying (just like middle school all over again!), but there are some lesser-known issues as well that could contribute to an unpleasant work environment. Among them are: 

  • absence of motivation among staff members
  • insufficient recognition for a job well done
  • pushing the idea of being a “family” to take advantage of employees
  • unclear instructions or a lack of direction from management
  • “scope creep” (an increasingly dire problem in the world of project management that refers to employees constantly needing to take on work not stipulated in their contract or above their pay grade)

Three ways to foster a positive company culture

Much of this has to do with the personalities of those at the top of the organizational hierarchy, but if you want to improve your company culture, here’s how to get started.

  1. Make your goals and expectations clear from the outset and reinforce them whenever possible. Transparency on the part of management will build trust within your team. If you construct a solid foundation and pay attention to the structure of your company culture, your team will act like support beams to hold it up and make sure it doesn’t collapse.
  2. Try to build a great team with similar values, but make sure to diversify your workforce. Listen to perspectives different from your own and respectfully respond to feedback and constructive criticism. It is more than likely that hiring people from different backgrounds will give you ideas you would never have come up with on your own, and the importance of that cannot be overstated.
  3. Keep your employees motivated by testing perks and incentive programs to reward a job well done. Your team wants to know that your company provides opportunities for social, professional, and personal growth. Some options to consider are offering bonuses, contributing to tuition reimbursement, staging raffles, handing out awards to recognize your top performers, or giving useful gifts (including gift cards, streaming subscriptions, coupons for local businesses, and discounts on health insurance). 

If you are reading this right now, that’s a great sign. It means you care enough about your company culture to want to improve it, and now you are well-equipped to do so.

Ayelet Noff headshot

Ayelet Noff Channels Her Passion for Great PR to Help Tech Companies Make a Difference

businesswoman standing in front of a holographic wall with stats and charts

Three of the Most Useful Growth Metrics for Every Stage of Your Startup