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Corporate Culture and its Impact on Small Business

Human Resources

Chances are you've heard the term corporate culture and wrote it off as the latest industry buzzword — something that has nothing to do with you. After all, you don't think of yourself as a corporate entity; you’re a small business.

Think again. According to the U.S. Small Business Administration, small businesses make up 99.7 percent of the employers in the United States and employ over half of the nation's private workforce — 55 million people. The American small business model is more alive than ever and many consider it an essential part of our nation's culture and way of life.

According to Entrepreneur, the definition of corporate culture is a blend of the values, beliefs, taboos, symbols, rituals, and myths all companies develop over time.

There are a number of different company cultures. One frequently seen in small businesses is a “family atmosphere.” This is a culture of communication and support, customer and employee loyalty, and mutual respect and understanding. Other examples are customer-focused and growth-centric cultures.

No matter where you fall on the spectrum of small to large employer, you have a culture. The question is, did you choose it and cultivate it, or did you let it develop organically within the organization?

Why should you care about corporate culture?

If you don't acknowledge and embrace what you stand for, then your small business train could easily derail. How so? Your hiring managers could bring on employees that don't seem to fit. You may start focusing only on “chasing the dollar.” Managers can't articulate the company's goals. Staff loses sight of the customer relationship. Without clearly, thoughtfully defining what you are all about — your corporate culture — you could lose hold of what was once important to your business’ success.

Embracing corporate culture

How do you ensure you don't lose track of your corporate culture? Embrace it. Whether it is customer focused, a family atmosphere, growth-centric, or something else, it is vital to find partners who can help you achieve and maintain your culture. Then, find employees, managers, and consultants who know how to support and grow your desired culture.

For example, if you want to grow yet remain a family atmosphere, you might consider having things like an employee assistance program, an employee recognition program, and safety procedures. What if you’re in a growth phase? Consider whether the hiring managers have been trained, not only on interviewing, but on the litigious nature of the hiring process itself. People don't leave companies, they leave managers. Are your managers trained on what is important to your culture? Do they embrace it? Can they lead the staff, while keeping that focus?

And what if you feel you have a customer-focused culture? Evaluate when the last time you trained the staff on effective communication and customer service was — and consider updating their training if it’s been too long.

Depending on the culture you choose to embrace, the way you manage and prepare your staff is imperative. Policies and procedures that support your culture should be created and continually communicated. Culture should be a key component in your recruiting process, considering attributes in candidates that fit the culture you wish to adopt. On the same note, prepare managers with the tools needed to effectively and lawfully remove employees who are not a good fit.

With a well-defined corporate culture, communicated and embraced from the top down, employees are more likely to know what the company stands for. When a person understands their purpose, they may be better able to do their job. Morale tends to increase, causing a ripple effect of loyalty to the company — and loyalty usually leads to increased production. The end result could be better service to the customer and higher profits.

How to establish and support your corporate culture

1. Determine your company's identity. What is important to you? What is the lasting impression you want to leave with employees and customers?

2. Communicate that desire, write down your expectations, and make sure all managers are on board. Hold company-wide meetings to roll it out to staff.

3. Update and revise handbooks, processes, and procedures to ensure the culture is being supported at the core functioning level. Establish standard expectations for the departments, and create or update job descriptions that line up with the overall culture you're trying to adopt.

4. Don't be afraid to get help. The process needs to be managed and developed internally, but you may need some external help to get the ball rolling.

5. Be a role model for what you expect and the employees will naturally tend to reciprocate the behaviors and patterns you establish as the norm.

Every business has a culture, whether you participate or not. Take the opportunity to develop a corporate culture that has meaning to you and it could play a key role in helping you achieve your business goals.

Female author icon
Christina Sacco-Lorenzini is a Senior HR Generalist at Paychex with over 15 years of experience. She specializes in employee relations and management training.
This website contains articles posted for informational and educational value. Paychex is not responsible for information contained within any of these materials. Any opinions expressed within materials are not necessarily the opinion of, or supported by, Paychex. The information in these materials should not be considered legal or accounting advice, and it should not substitute for legal, accounting, and other professional advice where the facts and circumstances warrant.