Skip to content

Work Culture: Definition, Types and Tips to Improve It

7 min read

Your company’s work culture is one of the key drivers of its success. A good company culture results in more engaged, productive, and loyal employees.  What makes for positive workplace culture?

Perks and ping-pong tables do not necessarily mean a positive office culture. Instead, company culture is about the attitude and environment that management creates and maintains. A positive work culture supports and encourages workers and protects employee well-being. In this post, we’ll cover the definition of work culture, benefits, and provide examples of companies with model work cultures.

  1. Work Culture Definition
  2. Why Work Culture is Important
  3. Types of Work Culture: The Competing Values Framework
  4. Workplace Culture Examples
  5. Tips for Improving Work Culture
  6. ✅ Measure Employee Satisfaction with Factorial ✅

Work Culture Definition

The work culture definition is the attitudes and behaviors of employees within an organization. Many things influence the company culture, ranging from the work environment (ok, so ping pong tables don’t hurt), policies, leadership, goals, values, and mission. In one study, 78% of executives said that culture is among the top five things that make their company valuable— but 84% said they need to improve their work culture.

A positive work culture doesn’t just happen. It takes thoughtfulness and careful cultivation. If you haven’t been thinking about your organization’s culture, chances are it isn’t where it needs to be. That can mean some major repercussions. A study in Sweden found that employees under “poor” leadership had a 25% higher incidence of heart problems. Physically and mentally stressed employees are not only less engaged. They’re also more likely to call out of work and eventually leave the company, leading to sky-high absenteeism and turnover rates. This can cost organizations big time.

Organizations with positive work environments conversely have more productive, loyal employees. Fortunately, there are a lot of ways to nurture the employee experience. Promoting diversity, transparency, and understanding can do wonders for a business. Furthermore, visible and accessible leaders inspire employees and keep management in touch with day-to-day problems. This means higher retention, reduced absenteeism, and best of all, happier and healthier employees.


Why Work Culture is Important

How, exactly, will a strong work culture affect your bottom line? Here are just a few of the benefits you can expect to see if you invest in building a strong culture.

A Positive Work Culture Means Increased Retention Rates

We’ve already mentioned this, but let’s dig a little deeper. High turnover isn’t just bad for morale. A survey from SHRM showed that the average cost-per-hire is just over $4,000. If your turnover rate is high, your business is most likely spending thousands of extra dollars a year just to keep positions filled. And that number doesn’t even factor in the expertise and knowledge that departing employees take with them.

Workplace Culture Can Lead to a Growth Mentality

A positive work culture encourages growth at the personal and organizational levels. Employees with a growth mindset will feel empowered to do their best work and pursue opportunities.  Businesses can harness the expertise of long-standing workers who have stayed with the company and attract new talent with their positive atmosphere.

A Strong Work Culture Means Increased Productivity

A positive company culture leads to happier employees who feel valued and supported. Happy employees aren’t just more pleasant to work with. According to Oxford University, happy employees are 13% more productive than their grumpy counterparts. And that’s not all! Satisfied workers will also serve as brand ambassadors when they talk about their positive work experiences. That looks good to potential clients and future employees.

Financial Success

According to a long-term study, businesses with great work cultures saw an 682% growth in revenue over eleven years. Meanwhile, those without the right company culture only grew by 166%. The numbers are clear: businesses that create a positive environment are more likely to be successful.

Types of Work Culture: The Competing Values Framework

Workplace culture comes in all shapes and sizes and is never static. In 1983, researchers Robert Quinn and John Rohrbaugh decided to define the structural differences in organizational culture with something known as the “Competing Values Framework.” According to the Competing Values Framework, companies tend to have characteristics that tie them to one or more of the following types: Clan Culture, Adhocracy Culture, Hierarchy Culture or Market Culture.

Now, let’s go through the meanings of each workplace culture type, one by one. We will outline the qualities of each, as well as the overall implications.  Which one does your organization most closely model?

Clan Culture

Clan cultures are characterized by horizontal, close-knit connections between employees. Basically, clan cultures are more or less the opposite of hierarchical cultures. Emphasis is given to teamwork, workplace equality, mentorship, internal communications, apprenticeship, and one-on-one employee training.  Unsurprisingly, employee engagement is often high in these nurturing and communicative environments.

Many smaller and family-owned businesses closely resemble a people-oriented clan culture.  However, it becomes increasingly more difficult to maintain this particular model as businesses grow and connections become more complicated.

Adhocracy Culture

An adhocracy culture is commonly found in start-ups and tech businesses like Google and Apple  Combining the terms ‘Ad hoc’ and bureaucracy, an adhocracy culture is largely uninhibited from the regulations and complexities of bureaucratic processes.  Instead, these cultures are known for flexibility, agility, and innovation.

An adhocratic culture works especially well for tech companies that need to stay on top of changing trends and continually push out new ideas.  With this particular workplace culture, a workforce can adapt and move forward at a faster pace.

The only complication arises when companies experience considerable growth.  Under these circumstances, it may be impossible to comply with certain legal and business practices. Rather than adopting an adhocratic culture throughout the entire organization, it may be best for growing companies to have an adhocracy culture within certain departments.

Hierarchy Culture

As the name suggests,  a hierarchical culture is defined by structure and levels of authority.  It is one of the most commonly found workplace cultures in larger corporate environments.  In this particular type of working model, roles, responsibilities, and goals are clearly defined.

In a nutshell, hierarchical cultures have clearly organized power structures, which can equate to efficiency and overall stability.  However, this particular type of workplace culture might also mean hindered flexibility and agility.  Depending on the type of business needs and industry, it may or may not be in the best interests for a company to adopt this model.

Market Culture

In a Market culture, results drive the processes. For organizations that have a strong market culture, the focus is on the competition and staying ahead of the curve.  Basically, the focus is on the outside market, rather than internal processes.

Although a market culture has its advantages, especially in fast-changing and customer service industries, there are some drawbacks to this type of work culture.  Often, leaders and employees are under a high amount of pressure to continually innovate and stay ahead of the game.  This can lead to increased levels of employee burnout and workplace toxicity.

Workplace Culture Examples

It’s easy to talk the talk, but are you ready to walk the walk? Here are our top three companies with interesting organizational cultures and what you can learn from them. This is how creating a thriving culture looks in the real world.

What is the Workplace Culture of Twitter?

Twitter has become famous for having employees who truly believe in their work. It’s not just the gimmicky stuff startups are known for like rooftop meetings, free lunches, and gym memberships. Even though extra benefits can be appealing, studies show that these perks don’t matter to employees as much as positive workplace cultures do. Employees want to work for a company with a mission they believe in. Twitter has done a great job unifying workers toward a common goal. Twitter has also prioritized creating a diverse and inclusive environment, which is key to creating a good work culture.

Etsy Work Culture: Personal and Professional Support

Etsy, the online retail platform, encourages workers to be themselves from the moment they start work. New workers receive a $50 credit to decorate their office space and encouragement to perform a special talent at the next all-hands meeting. Etsy also provides benefits which support employee’s work-life balance, such as 26 weeks of parental leave to both new mothers and fathers. Employees can pursue professional development through Etsy’s learning and engagement program. Employees in this environment feel valued for who they are as much as what they can do.

Define Costco’s Work Culture: Participation at the Forefront

Costco is well-known for having generous compensation and benefits in comparison with its competitors. For example, they offered their workers a $15 minimum wage in 2019. But they also create a culture that allows employees to speak up, offer suggestions, and take initiative. Having a good work culture means making employees feel heard, and Costco encourages employees to participate in decision-making processes.
New call-to-action

Tips for Improving Work Culture

If your work culture still has some room for improvement, don’t worry. Here are our best tips on how to change work culture and create an environment that employees feel excited about.

Clearly Define Your Cultural Values

To establish a strong work culture, make your vision clear. Express values clearly through a mission statement and reiterate these values through all communications. Most importantly, make sure that your business is taking action to represent these values in the world. Employees will be excited to contribute to an organization making a difference.

Encourage Collaboration and Communication

Employees will perform better under open and honest leadership. In short: transparency is key! Keep employees in the loop and make sure that they have opportunities to give feedback or offer suggestions. Check-in regularly with employees about expectations, goals, and performance. By communicating regularly, you can reduce misunderstandings and make sure problems are addressed as they arise.

Create a Diverse and Inclusive Workplace

It is vital to cultivate a diverse workforce. This won’t just make your workforce more creative, innovative, and agile. It will also help create an open work culture that supports and nurtures all employees. Valuing individual differences gives employees the opportunity to leverage their unique skills and abilities. For example, use inclusive signage, stay alert for unconscious bias, and adjust your hiring practices to be more inclusive.


Work Culture Means Empowering Employees 

Provide employees with opportunities to further their careers and follow their interests. This can be done by implementing training programs. It can also happen through open discourse and regular communication about desires and aspirations. Celebrate successes! But when things don’t quite meet expectations, work with employees so that they can do better next time. Don’t blame or dwell. Work culture definition means supporting employees and helping them to build new skills.

Improving Work Culture Takes Time

If you are bogged down with manual tasks, administrative paperwork and other boring tasks you probably feel drained. It’s hard to focus on employee well-being when you can’t even find the time to take care of yourself. Luckily, not all manual tasks have to take so long. Nowadays, HR automation and even AI can help lessen your workload. Don’t believe us? Check out our HR software to learn more about how you can cut the time you spend on manual administrative tasks and start spending it on things that need more attention: your team’s well-being.

Download Your Free Employee Satisfaction Survey

Related posts


Leave a Comment