Organizational Culture: Now More Important Than Ever

Culture is not just a buzzword, it's the key to success.

Indra Nooyi, former CEO of PepsiCo

According to PwC's CEO survey, 40% of CEOs don't believe their company will be in business in ten year's time. The labor market is incredibly tight, inflation still sky-high, engagement at the lowest in ten years, and unemployment also at a 53-year low. How do you help your company not just survive but thrive in this environment? The crux lies in creating an organizational culture of performance.

Why culture is more important than ever

You can “feel” the culture in an organization because it is often evident in people’s behavior, enthusiasm, and the space itself. In today’s network-oriented organizations, culture is what drives alignment and teamwork. Without the right culture to support the right business strategy, you can't win in the market.

Culture is not a nice to have, squishy topic, it’s a survival strategy for every company. Importantly, your culture needs to enable your business strategy. If your business strategy changes, then so does your culture. In today’s rapidly changing environment, culture change has become a necessity.

What does the right culture look like

Our research shows which cultural elements are more impactful than others. Based on studying thousands of organizations and millions of data points, combined with hundreds of deep-dive interviews, we developed our Culture Framework, showing seven elements of a high-performance culture.

These seven cultural elements hold true regardless of industry, geography, or company size.

Think about your organization's culture - where do you have strengths, where can you improve - and how do you transform the culture to fit changing needs? Our six lessons show the way.

The six lessons of culture and culture transformation

As industries are rapidly transforming and converging; skills, roles, and jobs are shifting constantly; and customer and employee expectations are moving quickly, it's important to understand how to create a cultural backbone.

Companies like the Mastercard (who created an entire culture measurement system, the Culture Health Index, to embed culture change into the business), Cidar-Sinai (honing a culture of wellbeing by considering buying apartments to ease communiting stress of clinical workers ), and T-Mobile (crowdsourcing ideas from the frontline to foster a culture of listening) are just some examples of applying these lessons - and you can read about them in our organizational culture playbook.

The role of HR and business leaders

Arguably, leaders are culture carriers, and HR is the culture champion. It’s clear, that HR is poised to play an essential role driving culture and culture transformation - as champions, coaches, and consultants.

HR is uniquely positioned to play this role, and to execute well on it, HR needs to build internal capabilities for culture and culture change, model the culture within HR, and translate the desired culture into all HR processes, from recruiting to retention, from learning to performance management, and from rewards to DEI.

Operationalizing a culture of performance

The culture of your organization must be intentionally designed and systemically reinforced, mirroring the mission and vision and reflecting in every aspect of the business.

Ultimately, culture change is not a “process” but a cross-functional strategy that needs to be embraced by the C-suite. And it’s also not a “project” that will ever be done. It’s a huge area that includes many different strategies, practices, processes, systems, services, and technologies.

Organizational culture needs to be designed with intention and caution, because culture can make or break a company.

To change the culture, don’t start with the culture. Start with the problem you are trying to solve, what success looks like, and why it matters to your company.

Culture is perhaps the biggest success factor of your company. And it’s at the heart of making your organization truly irresistible.

Where to Go Next

• Read our Big Reset Playbook: Organizational Culture and Performance 
• Join 40,000 HR professionals in the Josh Bersin Academy to connect with a community of global leaders and learn about culture and change
• Contact us to become a JBC Member for access to action-oriented practical research, assessments and diagnostics, learning programs, advisory services, and much more