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Think of organizational culture as the lifeblood of a company. It influences everything from how engaged employees are to how satisfied customers feel. It’s about the collective values, beliefs, and practices that have an overarching influence on how work gets done. Leaders play a pivotal role in this regard. Cultural leadership sets the tone for an organization’s success or failure.

In this article we discuss why leaders have such a pronounced impact on their company’s culture, the pitfalls that shape culture for the worse and how leaders can go about shaping organizational culture for the better.

How Does Leadership Influence Organizational Culture?

Why do leaders have such a pronounced impact on organizational cultures? Here are a few reasons:

  • Being the Example: Leaders are like the North Star for behavior within a company. Their behavior, attitude, leadership style and work ethic set a precedent for what is deemed acceptable. If employees see their leaders acting a certain way, they’re likely to follow suit.
  • Decision-Making Power: The choices leaders make steer the company in one direction or another. These decisions reinforce cultural norms and organizational values.
  • Rewards and Recognition: Leaders have the power to reward and recognize employees. In many ways, leaders have the power to advance the careers of their teams, and therefore the behaviors they recognize and reward become the cultural template for their workforce.
  • Resource Gatekeepers: Where leaders decide to allocate resources, be it on people, tech, or projects, sends a clear message about what the company values, which in turn affects culture.

With this kind of influence, leaders need to actively nurture a strong organizational culture. Otherwise, the poor behaviors leaders exhibit can sour a culture and hurt the business.

When Leadership Takes a Wrong Turn: The Don’ts

Even with the best intentions to create a strong corporate culture, leaders can sometimes shape a culture in a negative way. Here are a few ways how:

  • Too Much Control: Micromanaging stifles creativity and autonomy, leading to a culture of dependency and fear of taking initiative.
  • Ignoring Feedback: Neglecting employee feedback creates an environment where team members feel undervalued and unheard, diminishing morale and engagement.
  • Sending Mixed Signals: Inconsistent communication and mixed messages breed confusion and distrust, which undermines the organization’s cohesion.
  • Playing Favorites: Favoritism can break a strong culture and breed resentment.
  • Not Walking the Walk: Not leading by example erodes respect and undermines the cultural foundation. If leaders don’t live by the company’s values, why should anyone else?

Recognizing and fixing these missteps early can prevent a great deal of damage to your company’s cultural fabric.

How to Shape Organizational Culture for the Better

Here are some measures leaders can take to build a strong culture within their teams and business.

Live Your Values

Leaders must ensure their actions and decisions reflect the company’s stated values and desired culture.

Conduct Employee Focus Groups

Gathering feedback directly from employees can provide invaluable insights into your culture’s current state and what needs a tweak.

Promote Openness

Creating an environment where everyone feels comfortable sharing their thoughts builds trust and engagement.

Include Employees in Decision-Making Processes

Sharing your decision power and involving employees helps create a sense of belonging. It also shows that you respect your employees’ opinion. Employees that feel valued are engaged, and they drive the business forward.

Cheers to Success

Implementing recognition programs aligned with the culture and business strategy you want reinforces positive behaviors and achievements, further embedding the values within the organization.

Shaping Company Culture: Building a Successful Organization

Leadership’s role in molding organizational culture is crystal clear. A culture that’s actively cared for leads to stellar employee performance, which in turn spells success for the business. 

At The Dunvegan Group, our workplace culture training equips leaders with the skills and knowledge to positively transform their organizational culture. We support you in rolling out strategies that align your company’s values, goals, and practices, and take your business to the next level.

The Dunvegan Group – Facilitating Success

If you’re looking to make a lasting impact on your organization’s culture, the time to act is now. Book a consultation with The Dunvegan Group for expert advice on building a culture that fits your vision for the future and propels your business forward.