How to Change Company Culture: A Step-by-Step Guide

With customers to serve and products to produce, it's easy for company culture to get put at the bottom of the to-do list, but it deserves your attention.

Of highly engaged employees, 89 percent of them say the culture at the organization they work for is positive. It's no wonder that companies with a good corporate culture have 4X higher revenues than companies without a good culture.

The good news is that it’s never too late to start thinking about organizational culture and change management. Whether your company is brand new or has been operating for years, you can create a company culture that supports happy, productive employees.

Here are four common questions with answers that reveal step-by-step tips for changing the culture in your company.

What Are the 5 Steps in Changing Culture?

There are five major steps to changing organizational culture. They include:

• Assessment of the current culture
• Define the desired culture
• Develop a plan for culture change
• Implement change initiatives
• Monitor and adapt

Assessment of the current culture

First you have to assess the current culture. And the best place to start is by using employee engagement software or culture assessment tools.

Employee engagement software enables you to send out customer engagement surveys. You can personalize the questions on the survey to ask employees their opinion of the company culture. Because they are completely anonymous, you can gather accurate feedback to get a baseline measure of how employees view your current culture.

Related: 50 Employee Engagement Strategies & 5 Most Popular Examples

Define the desired culture.

Are the results you gathered indicative of the type of culture you want to have in your organization? Whether positive or negative, it’s important to take the time to define the type of company culture you want alongside the information you gather from an engagement survey.

Your mission is a good place to start. Thinking critically about your mission enables you to develop a list of aligned values that help you achieve that mission. You can then determine what actions and behaviors support those values.

Develop a plan for culture change.

Once you have clearly defined what type of culture you want, it’s time to develop a plan. How are you going to get employees to embody your desired culture?

You can start simple and share the company’s mission and values to remind employees what the organization is all about. Then, you might ask employees and their managers to create goals that support certain behaviors.

Every plan is different depending on the organization creating it. What matters is that you develop a plan that aligns with your cultural goals.

Related: How to Improve Employee Satisfaction - 15 Examples

Implement change initiatives

Actually changing organizational culture means you have to put your plan into action. That means getting your employees involved.

Employees have to see that real changes are being made. For example, you don’t just send out a quick email reminding everyone to behave in alignment with the company’s mission. You follow it up with a robust performance review process, and regular engagement surveys to get employee input, and provide ways for employees to embody the change you want to see. You could also plan team-building activities or a system of rewards and recognition for those who embody target attitudes and behaviors.

Monitor and adapt

What you think will get you closer to your target company culture doesn’t always work. That’s why it’s important to monitor progress and adapt, as needed.

One-on-one meeting software is a great way to monitor employees and pivot in real-time. Employees regularly check in with managers so they can talk about challenges, offer their input on changes, and talk about how company culture is impacting them on the job. Not to mention, having regular one-on-one meetings is a great way to create a culture where employees feel like they’re supported to meet their goals.

How Do You Reshape a Company Culture?

Creating a company culture from the ground up is relatively straightforward. Trying to figure out how to reshape company culture is different.

Here are a few tips that will help if you’re starting with an existing culture and want to figure out how to influence cultural change in your workplace:

• Leadership commitment
• Employee involvement
• Clear communication
• Alignment with business strategy
• Continuous evaluation

Leadership commitment

The leaders in your organization must set the right example. If you want to sway the culture at your organization, that means getting leadership on the same page.

Start with the highest tier leaders at your organization like the CEO, CFO, and heads of department. Make sure they understand the plan that has been developed, how it’s going to be implemented, and how they can support the process in a way that shows employees that they’re on board.

It also means including managers in the plan you have developed and how it’s going to be implemented. Employees are less likely to contribute to the company culture in positive ways if they don’t see positive behavioral changes in their managers and higher ups.

Related: 7 Team Management Skills Every Manager Needs

Employee involvement

Once all the leaders are on the same page, you have to find ways to make sure your employees are involved. A simple way to do that is with 360 feedback software.

Not only does it allow managers to leave feedback for employees, it allows employees to leave feedback for their managers. It also enables them to leave feedback for each other. It creates a sense that everyone is in it together. This kind of feedback propels the company culture forward by ensuring employees are involved in the process in a comprehensive and impactful way.

Clear communication

Communication is vital to change management. Without it, you may think you’re creating an effective company culture, but that’s not what employees see.

Annual performance review software is a good place to start, but make sure that there are ways for employees to communicate with their managers and each other throughout the year. That might include sending out anonymous pulse surveys and scheduling regular check-in meetings with managers.

It should also include keeping all company culture-related communications on the same platform with the rest of your performance management information. That way employees and managers can easily access the data, and it can be measured over time.

Related: Ultimate Guide to Communication in Employee Engagement

Alignment with business strategy

If you want the tweaks you make to company culture to last in the long run, they have to be aligned with business strategy.

Aligning company culture goals with a larger performance management strategy is a great way to make sure they are top-of-mind so you’re always making strides towards a more positive company culture.

For example, larger strategic initiatives may be tied to productivity and performance, which are part of the goal-setting process. You can include culture-related goals as part of the process too, enabling employees and their managers to see how it all ties together under the company’s mission and values.

Continuous evaluation

Continuous evaluation is needed while you’re reshaping company culture. It’s also important that you think you have established the right culture, as it changes and evolves.

Continuous feedback software makes it easy to make sure everyone is on the same page while new initiatives are rolled out. It also enables you to pivot quickly if the data from a review cycle or an employee survey highlights a change that needs to be made.

How to Turn Company Culture Around?

Changing an existing company culture isn’t easy. That’s especially true if you’re not just making tweaks, but you have to do a complete culture turnaround.

No matter where you're starting from, there are things you can do to turn company culture around that include:

• Identify negative aspects
• Create a positive vision
• Engage employees
• Cultivate new behaviors
• Celebrate small wins

Identify negative aspects

Although it can be tempting to focus on all the positive things you’re going to do to turn your company’s culture around, you have to get real about the negative aspects of your current culture first.

For example, maybe you've noticed there is a lot of gossip in the office, or maybe you notice that not only do employees work late and skip lunch, but that they are often tardy or call in absent a lot.

Don’t shy away from asking for input from managers and employees too. They may be able to tell you about stressors and negative aspects of their daily experience that you otherwise may not have discovered.

Create a positive vision.

Creating a positive vision is the next step. Using what you’ve learned about what isn’t working, you can create a personalized vision that tackles your unique challenges.

It can also be helpful to research successful organizational culture change examples as part of this step. From Netflix to Microsoft, many large companies have course-corrected. Digging into the details can not only inspire you, it also give you hope that if they can do it, so can you.

Engage employees

The only way to turn company culture around is to make sure your employees are engaged throughout the process.

Employees should have a say in what changes they would like to see from the very beginning. They should continue to have input throughout the process, whether that includes answering questions on a pulse survey or dedicated culture-related questions during the next round of employee check-ins.

Related: How to Improve Retention with Retail Employee Engagement

Cultivate new behaviors

The only way for a big cultural change to stick is if everyone engages in new behaviors. For example, Netflix adjusted its culture so that it sees mistakes as opportunities for learning and growth instead of seeing mistakes as something to be avoided at all costs. Employees now feel supported to take risks, which can lead to innovation.

Goal management software can help with this step. Explicit behavioral goals can be created, measured, and tracked over time. It supports meaningful conversations between employees and managers about challenges they are facing, and it gives them opportunities to share their wins, further supporting the new culture you’re striving for.

Celebrate small wins

Turning a company culture around takes time. It’s important to celebrate the small wins so everyone feels motivated to keep moving forward.

Thank you cards, extra days off, and treats can be quick and easy ways to celebrate small wins. Incorporating 360 reviews can be a great way to celebrate small wins too. It allows employees to send reviews to each other, including positive reviews, so everyone feels like their contributions to company culture are being noticed.

How Can We Improve Company Culture?

Looking for some actionable ways to improve company culture? Here are some culture improvement strategies that can positively impact your business, regardless of your industry:

• Promote work-life balance
• Recognize and reward contributions
• Enhance communication
• Provide development opportunities
• Create an inclusive environment

Promote work-life balance

A bad workplace culture encourages employees to put in plenty of overtime to prove their worth. The trouble is, skipping breaks, not eating lunch, and staying late is a recipe for burnout.

The company culture you create should promote time for rest. Managers should model taking breaks and eating lunch so employees feel like they can do the same.

Promoting work-life balance might also include:

• Encourage employees to take their vacation time
• Switch the focus from hours worked to productivity levels
• Allow flex time or hybrid working
• Consider giving employees the ability to take an extended sabbatical
• Provide opportunities for exercise during work hours

Recognize and reward contributions

For your culture to thrive, you have to make sure your employees are recognized and rewarded for their efforts, no matter how big or small. Just make sure you consider the preferences of your employees. For example, extroverted employees are likely to appreciate a shout-out at the next meeting, while introverts are more likely to appreciate a handwritten note.

Not sure who to reward for what? Use HR analytics software. It allows you to create and track specific behaviors over time and compare them to the behaviors of other employees. You can see who is going above and beyond, and you can identify employees who are supporting your culture initiative but might be falling through the cracks.

Enhance communication

Enhanced communication is among the best examples of cultural change. Just keep in mind that enhanced communication doesn’t necessarily mean more communication. As a matter of fact, 58 percent of workers in one survey reported feeling like they have to be available more often when communicating digitally, which can lead to burnout.

Instead, focus on the quality of communication. For example, goal check-in software encourages employees and their managers to schedule regular, meaningful meetings. When employees get to talk about what’s working—and what isn’t—they feel like their input matters.

Provide development opportunities

If you want a positive company culture, you have to support what's important to your employees, which means providing them with development opportunities. After all, nearly 9 in 10 millennials say career growth opportunities are extremely important to them at work. 

There are several ways to support your employees’ development. Ideas include:

• Network events
• Training and workshops
• Tuition remission
• Mentoring

Create an inclusive environment

Diversity, equity, and inclusion (DEI) is an effective way to create an inclusive environment, with studies showing that supporting DEI initiatives increases financial returns. Creating an inclusive environment also means evaluating your executive team to see if they portray diversity and inclusion, supporting systems of communication where every voice is heard, and fostering ways to encourage diverse thinking.

Employee surveys can be especially helpful when you segment the results of employee engagement surveys by minority cohorts. You can identify issues that are specific to groups of employees based on their gender, cultural background, religion, age, and more. Then, you can make changes that make those groups feel more included.

Drive Cultural Change in Your Company With Performance Management Software

It doesn't matter if you're wondering how you can improve your company's existing culture, if you're starting from scratch, or if you have to do a complete 180. If you're willing to assess what isn't working, get on the same page about a way forward, and create systems for sustaining culture change in your organization, you can create an environment that supports your employees and drives organizational success.

The right performance management software can make organizational culture and change management much easier. PerformYard enables you to create a system of reviews, goal management, feedback, and engagement. It’s easy for everyone to see where they’ve been, where they’re going, and how to get there so you can craft a culture that perfectly reflects the mission and values of your organization.