Company culture research summary. Company culture can play a huge role in how productive, positive, and successful a workplace is. After all, when workers feel safe, secure, and bonded with their environment and co-workers, everything becomes a little bit easier. We’ve gathered everything you need to know about company culture. According to our research:
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46% of job seekers say company culture is an important factor in their decision-making
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94% of entrepreneurs say healthy company culture is vital for success
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47% of job seekers cite company culture as the driving reason to look for a new job
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56% of employees rank good workplace culture as more important than salary
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86% of job seekers avoid companies with a bad reputation
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70% of job searches start on Google
For further analysis, we broke down the data in the following ways: Management | Employees | Benefits | Downsides
Job seekers and company culture
Finding a good company culture is a priority for many job seekers. This is because having a good or bad company culture can have a huge impact on an employee’s productivity, happiness, and more. To find out more, here are some crucial insights from job seekers about company culture:
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88% of job seekers say healthy company culture is vital for success
Nearly as many job seekers as entrepreneurs agree that healthy company culture is crucial, showing that employees are just as preceptive as employers when it comes to noticing the health of the workplace.
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15% of job seekers have declined a job offer due to poor company culture
Many job seekers avoid companies that have a bad reputation, but over 1 in 10 employees will go on to reject a job offer even after they apply.
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35% of workers say they would pass on the “perfect job” if the culture was a bad fit
It’s hard to argue that a job is perfect if it doesn’t have a good company culture. And, it seems that over a third of employees agree.
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77% of workers consider company culture before they even apply.
With 15% of job seekers rejecting jobs from companies with poor company culture after they apply, it’s even more shocking to consider that three-fourths of job seekers may not even have applied to begin with.
Management and company culture
Company culture should be at the forefront of every good manager’s mind. From increasing revenue to reducing turnover, there are many reasons why management should prioritize company culture. For example, according to our research:
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91% of managers say job seekers who align with their company culture are more important than skills and experience.
While expecting some experience in the field might be the norm for most managers, the truth is that the vast majority would rather hire a noobie with an ideal personality and work ethic, rather than an experienced individual who just doesn’t fit.
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Having a culture that attracts top talent can increase revenue by up to 33%.
For context, this means that a company that makes $1 million in revenue per year would instead make $1.33 million in the same year just by prioritizing company culture.
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85% of companies say culture offers a competitive advantage.
When employees enjoy their company culture, they’re less likely to quit their jobs and more likely to have higher productivity. Just these two factors can give companies a noticeable competitive advantage.
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72% of companies say culture helps successful change initiatives happen.
Having a successful company, especially in highly volatile and competitive markets like tech, for example, requires adaptability. Luckily, a healthy company culture helps maintain that adaptability through easier changes and initiatives.
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Only 28% of executives understand their company’s culture.
While a considerable 92% of CEOs report that they understand their company’s culture, the fact is that only 50% of employees believe upper management actually does. This gap in perceived understanding can cause huge issues for a company and shows that many of those in management may be out of touch.
Employees and company culture
Company culture affects employees quite possibly more than anyone else in the workplace. To see just how much employees are impacted by healthy or unhealthy company culture, here are some essential insights our research uncovered:
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22% of employees feel connected to their company culture
While this is still only 1 in 5, it’s a noticeable increase from 2018, when only 16% of employees felt connected to their company’s culture (a 37.5% increase).
Feeling connected to company culture over time
Month/Year Share of employees who feel connected to their company culture June 2018 16% March 2021 21% February 2022 20% November 2022 22% February 2023 21% May 2023 22% -
80% of employees would work harder if they received more recognition.
Employee recognition is an essential part of fostering a positive company culture, as it not only incentivizes employees to work harder, but also reduces turnover rates by 31%.
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88% of employees believe a strong culture is key to business success.
Like entrepreneurs and job seekers, the majority of current employees also agree that a strong and healthy company culture is important. This shows that employees are aware of how an unhealthy company culture negatively impacts a business’s bottom line.
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72% of workers around the world report their company culture as “good.”
Conversely, 20% of workers only rate their company’s culture as average, and 7% say it’s poor or very poor. Luckily, it seems the majority of companies are prioritizing their company culture, at least according to these employees.
Global company culture rankings by workers
Ranking Share of workers Good or very good 72% Average 20% Poor or very poor 7%
Benefits of a strong company culture
Strong company culture comes with many benefits, for employers and employees. Here are some examples of these benefits outlined:
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Highly engaged employees have 17% higher productivity.
Research has shown that highly engaged employees, a benefit that often comes from healthy company culture, perform better in the workplace. Further, this increased performance ultimately drives profitability up by 21% on average.
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Happy employees are 20% more productive than unhappy employees.
Similar to highly engaged employees, happy employees are also considerably more productive on average. Employees are far more likely to be happy when their own values align with their company’s culture.
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Companies with strong cultures are 89% more likely to report high customer satisfaction.
A strong company culture creates highly engaged and happy employees, which in turn, increases customer satisfaction in a noticeable and significant way.
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Companies with strong company cultures have seen a 4x increase in revenue growth.
Over time, this would be the difference between making $500,000 per year in revenue annually, and $2 million.
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Companies with strong company cultures experience 25% growth in their workforce over a 3-year period.
All companies want to grow, and having a strong company culture has proven to increase growth. Over a 3-year period, a company with a strong culture could grow from 500 employees to 625 employees.
Downsides of a poor company culture
A strong company culture might have benefits, but that also means that poor company culture can come with some major downsides. Here are some examples of these downsides:
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90% of workers who rate company culture as poor have thought about quitting.
Companies with poor company culture are in real danger of losing employees and facing high turnover rates, as 9 out of 10 of their workers think about quitting.
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40% of employees would leave a job if the culture had negative office politics.
Employees face enough drama with their families, friends, and customers to want to experience the politics of a toxic work environment. With that in mind, it’s unsurprising that just under half would quit when faced with negative office politics.
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Employees who don’t like company culture are 10.4x more likely to quit.
Employees aren’t afraid to move on when they don’t like a company’s culture, and given that replacing an employee costs over 30% of their salary, on average, this is bad news for companies with poor employee culture.
Company culture FAQ
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How important is company culture?
Company culture is very important, as it can make or break how successful a company is. For example, 86% of job seekers avoid companies with bad reputations, and 90% of employees at companies with poor company culture think about quitting. This negativity can quickly lead to expensive turnover, understaffing, and other issues.
By contrast, companies with healthy cultures can have up to 20% increased productivity from their employees, 21% more profitability, and ultimately 4x the revenue over time. All of these benefits can add up over time and make a huge difference in how successful a company can become.
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What are the 4 Cs of company culture?
The 4 Cs of company culture are Competence, Commitment, Contribution, and Character. In more detail, here are each of these components outlined:
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Competence. Otherwise known as intellectual capability, having a competent culture allows employees to continuously gain knowledge and valuable skills. This, in turn, allows the company to adapt to new innovations and changing landscapes.
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Commitment. A company culture with commitment incentivizes employees to pursue goals and challenges without giving up. This consistency then allows for skill growth and the completion of important projects.
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Contribution. A company that prioritizes contribution ensures that competent and committed employees share their skills and knowledge with others, rather than having them go to waste. When all employees are contributing, projects and tasks are completed more successfully.
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Character. Character allows employers to set the tone for how a business operates, and get into the mindsets that will best motivate employees. This is necessary for success, and crucial when things inevitably go wrong at times.
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What makes a good company culture?
A good company culture requires many factors, the most important of which are good ethics, values, workflow, goals, management, and expectations. Employees want to feel heard in the workplace, and when they do, they are happier, more engaged, and more productive.
The first step in creating a healthy company culture can sometimes be as simple as knowing what to avoid. Employees hate politics in the workplace, and don’t like being somewhere that doesn’t align with their values.
So, after you’ve ensured your workplace is supportive and drama-free and filled it with like-minded employees, all you need to do is create an organized, collaborative workplace with clear expectations.
While this is always easier said than done, we recommend reviewing important statistics, learning from other successful employers, and gathering valuable feedback from your own employees on how to improve your culture.
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What are the signs of a good company culture?
There are many signs of good company culture you should look out for as a job seeker. Some of the most important and easy-to-see signs include:
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The company has no shortage of well-qualified job applicants
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Excellent performance is expected from employees
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Company leaders make the company’s values clear to employees
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The business has low turnover rates
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The company has a conflict resolution plan for employees and/or customers
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No signs of office politics
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There are regular employee referrals
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There is a high level of trust between employers, employees, and customers
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The company invests in training for their employees
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The business has a proven track record of successful financial performance
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Conclusion
Company culture plays a crucial role in the success of a business, and most employers and employees are aware of it. Job seekers and employees especially either avoid companies with bad reputations or consider quitting when they find themselves stuck in a toxic work environment.
Ultimately, companies with good cultures see many benefits, including decreased turnover, higher productivity, increased profitability, and more. Over time, strong company culture can grow revenue by up to 4x, making it a small investment with truly massive returns.
References
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Work Life – How to build a company culture that sets you apart
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People Plus – Is Your Company Culture Attracting the Right Talent?
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Haiilo – Company Values: Definition, Importance and Examples
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SHRM – Strengthening Workplace Culture: A Tool for Retaining and Empowering Employees Globally
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Forbes – Culture Is A Company’s Single Most Powerful Advantage. Here’s Why
Author
Jack Flynn is a writer for Zippia. In his professional career he’s written over 100 research papers, articles and blog posts. Some of his most popular published works include his writing about economic terms and research into job classifications. Jack received his BS from Hampshire College.
