Do you recognize the signs of a broken company culture? If you don’t know how to assess company culture, you may have a problem determining whether it’s healthy or not. In his analysis of corporate culture problems, Douglas Ready explains that too many business leaders fail to understand the difference between a strong culture and a healthy culture. Unfortunately, a strong culture can be unhealthy. If that’s what you’re faced with, the next logical step in this process requires you to improve your poor company culture.

Defining Company Culture

At Altametrics, analysts say, “Company culture is defined as the collective values, characteristics, behaviors, and attitudes of a specific organization.” Using that definition, we can agree that a good corporate culture emphasizes employee development and upward career mobility. Organizations that give employees paid time off to volunteer at their favorite nonprofit group are also good examples of how to build a positive culture. On the other hand, businesses that don’t give their employees sufficient time to use the restroom during work hours have a poor culture. The same holds true for businesses that allow employees to bully co-workers.

Sources of Workplace Culture

Workplace culture evolves as social customs change, as leadership changes and as an organization grows. But where does workplace culture originate? Back in the day, as Denise Lee Yohn points out, corporate culture came from the top down. Maybe the CEO paid for and encouraged team members to enjoy a monthly birthday cake for everyone who turned a year older. And senior leaders might have participated in supporting a favorite charity and advised middle managers to join in.

Corporate life has changed in recent years. All employees contribute to workplace culture in a healthy organization. This shift started with the COVID-​19 pandemic. But in addition to the pandemic, more organizations now employ highly educated employees who want to have a say in their day-​to-​day work experience. They expect to have a voice regarding which nonprofit organizations should benefit from their efforts. And they might also like to contribute to informal practices like the creation of a band that plays at holiday gatherings.

As employers compete for talent in today’s competitive workplace environment, they’re realizing that a great corporate culture can be a powerful recruiting tool. A star software engineer may be lured to a company if they’re promised the opportunity to help shape corporate culture. Likewise, a company with a reputation for a bad culture will drive away talent.

While all employees contribute to workplace cultures, leaders should know how to assess company culture.

How to Fix Your Culture Problem

It doesn’t take long for the word to spread about a toxic environment. Uber’s leaders famously ignored complaints about its “locker room” culture. Then an employee leaked the information which led to thousands of people refusing to use the service until the leaders improved the workplace environment. You can’t afford to risk the kind of trouble Uber experienced because of its broken culture.

How can you accurately assess if your workplace culture is broken? A sudden increase in employee exits can be a sign of organizational trouble. Take a closer look at where the exits are happening. If a single department has lost a significant number of employees, the leader may have a toxic personality. Or the leader may not be dealing with a bully who exhibits toxic behavior and is intimidating co-​workers. This situation can develop when an employee plays an important role in organizational success, such as being the sales star. Because of this person’s success, leaders are afraid to correct their toxic behavior. In the end, the loss of other great employees may cost the organization more money than the toxic sales star brings in.

You can lower the risk of hiring employees with toxic workplace tendencies by using psychometric assessments. The assessment results reveal which candidates will struggle in specific workplace situations. Making better hiring decisions will reduce friction and increase employee engagement.

Keeping the lines of communication open is key to fixing a broken culture, Douglas Ready explains. “Make explicit statements about the unique signature of your organization — what makes it a special place — but then engage employees in active discussions about the gaps that might exist between those aspirational statements and the reality on the ground.”

Workplace culture does not stay static. If you want to know how to assess company culture, you should pay attention to signals such as falling productivity and engagement, as well as sudden employee exits. Improving company culture will require you to model the behaviors you’d like to see in your company. You should solicit feedback from your team members. Then, you can help guide the culture in a direction that will support corporate success.

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