Why Companies Struggle With Corporate Culture
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Why Companies Struggle With Corporate Culture
Many CEOs and CFOs feel that corporate culture is important to their organization, but very few of them think that their culture is right where it should be. -
Prime Ingredient
91% of survey the CEOs and CFOs responding to the survey feel that corporate culture is important to their organization. -
Key Component
61% said corporate culture has a big effect on productivity; 55% said the same about their organization's overall value; and 53% said the culture greatly impacts profitability. -
Tall Order
Only 15% said their corporate culture is "exactly" where it should be, with 32% said it either needs "considerable work" to get there, or that it needs a "substantial overhaul." -
Top Drivers of Cultural Effectiveness
Trust among employees: 83%, Coordination among employees: 73%, Decisions that reflect the firm's long-term interests: 69% -
Dangerous Territory
84% of respondents said having a poorly implemented or ineffective culture increases the chance that an employee would do something unethical or illegal. -
Executive Input
70% of CEOs and CFOs said leadership needs to invest more time in developing the culture. -
Losing Pace
49% said their culture has not caught up with recent changes in their business environment. -
Bottlenecks
48% said their culture encourages inefficient workplace interactions, such as spending too much time building consensus. -
Checked Out
40% of respondents believe that their employees are not fully committed to their organization's culture. -
Self-Defeating
39% said their organization's policies—such as those affecting compensation and corporate governance—work against its intended culture.
While the vast majority of CEOs and CFOs feel that corporate culture is important to their organization, a stunningly low percentage think that their culture is right where it should be, according to a recent survey conducted by Columbia Business School and Duke University's Fuqua School of Business. The resulting report, "Corporate Culture: Evidence from the Field," indicates that formidable barriers stand in the way of positive progress, and organization leaders need to spend more time helping to develop the corporate culture. In addition, the report notes that managers must eliminate inefficient workplace interactions, while better engaging employees. Once such obstacles are overcome, however, an improved culture can have a major beneficial impact on key success drivers, such as employee productivity and profitability. "We discovered that culture is almost like air—it's everywhere yet invisible," said Shivaram Rajgopal, a professor at Columbia Business School. "When harnessed correctly, corporate culture can turn into a tailwind of progress instead of a headwind of obstruction." Nearly 2,000 CEOs and CFOs took part in the research.