How Company Culture Shapes Employee Engagement?

Deloitte research cites culture and engagement as the top challenges for 87 percent of organizations, particularly for measuring culture and engagement effectively. Measurement of both factors, culture, and engagement, is necessary as they yield major benefits. For developing a high-performance culture fueled by engaged employees, decouple the two – culture and engagement – and see each as an individual entity with its own set of contributions. 

Companies with high-performing cultures are innovative and customer-focused and meet their strategic objectives under their values. In the same way, employees who are engaged are more productive and far less likely to leave the company. Both are important and closely related, but they differ in nature, and hence, measuring a company’s culture and employee engagement requires specific metrics. Unfortunately, companies often employ the same tool to measure both. For example, when employee surveys are conducted, there is no specific questionnaire for measuring the culture and understanding level of employee engagement. Your cultural change and employee engagement programs will fail if you aren’t clear on what you are measuring.

Can any one aspect – company culture or employee engagement – thrive by itself?

Although many managers believe that employee engagement surveys alone can boost productivity, it is not so. Improving the organization’s overall culture with a higher level of employee engagement is a far better way to boost business productivity and drive growth. To simply put, employee engagement is inextricably related to the strength of the company culture.

Understanding what is Employee Engagement

An employee’s engagement has to do with how employees feel about their workplace and work culture. The healthier a company’s culture is, the easier it becomes for the employees to grasp their roles and responsibilities. Engagement leads to happier, more motivated, and more committed employees. 

Engaged employees are more likely to be:

  • Dedicated and motivated to exceed their company’s goals.
  • Positive and proactive about acquiring new skills and being creative in resolving problems.
  • Devoted to building their careers with an organization

Engaged employees add a multitude of benefits to an organization, which include increased productivity, stronger customer relationships, and decreased turnover, to name a few. 

Also read: Why is employee engagement important for your company?

What do stats have to say about employee engagement and culture?

Interestingly, looking at certain stats, it is undeniable that employee engagement is closely related to a company’s high-performing and healthy culture.

Understanding what is company culture

Simply put, company culture refers to the employees’ norms, practices, and behaviour that influence how and why certain events or actions happen in an organization. 

Company cultures that excel can have a positive impact on all areas of an organization. Engaged employees, increased productivity, achievement of goals and increased retention are all hallmarks of high-performance work cultures. A company with a strong culture, for example, has a 14 per cent employee turnover rate when compared with a company with a subpar culture, which has a 48 per cent turnover rate.

In what ways does a high-performance culture differ from a usual company culture?

A high-performance culture focuses on following effective and workable practices and norms to drive superior employee performance in an organization.

To elaborate, it’s a culture that allows a performance-driven organization to achieve superior financial and non-financial results, with values such as better service, high employee engagement; improved client satisfaction; increased productivity, and employee retention, over a long period.

Also read: How to build a positive workplace culture and its benefits

Company culture and employee engagement: how are they unique?

To differentiate between the two, think of employee engagement as focusing on an employee (or ‘I’ factor) and culture as emphasizing the whole (‘or ‘we’ factor). Therefore, the employee engagement factor has to do with how employees feel about their employer and their workplace work. 

An engagement survey can make a good predictor of employee retention, as it can measure loyalty and productivity. Managerial actions or other factors can severely affect employee engagement or even hurt it quickly.

Culture, on the other hand, focuses on intrinsic company values, which are often unquantifiable and difficult to assess. An organization’s culture is, essentially, ‘the way we do things.’ Changing culture takes time and effort because it’s often deeply ingrained. Hence, to influence a company’s culture, you must engage in a long-term reform program, or you must experience a significant external change, like an acquisition or merger.

Thus, employee engagement focuses on keeping employees motivated and happy while company culture lies deeply buried within an organization based on certain values, practices, norms, and a set of beliefs. To understand each of them better, it is necessary to understand how to measure your company culture and engagement.

Why is it necessary to measure engagement and culture?

Measuring culture and employee engagement is crucial since engaged employees are directly linked to employee retention, performance, and a company’s profitability. Importantly, the measurement of company culture and employee engagement helps to understand whether employees’ engagement and commitment align with a company’s expectations and strategic objectives or not. 

Most organizations adopt certain metrics to measure company culture and employee engagement. To start with any form of quantifiable measurement, understand and know where the culture stands now and what steps you have taken to create a high-performing culture

Unlike employee engagement, culture focuses on an organization’s core values and vision, and hence, any type of off-the-shelf survey will not be effective.

How company culture and engagement are assessed differently?

Culture and engagement are not only measured for different reasons, they must also be evaluated differently. For instance, you can find out how engaged your employees are based on the scores of your employee engagement survey. Using this data, you can then determine what improvements can be made. You can compare employees’ performance to that of previous years or similar organizations to get clarity on employee engagement and performance.

On the other hand, when it comes to culture, there is no right or wrong way to respond. Based on its goals and business objectives, an organization must identify what is ‘good’ and ‘bad’. Viewpoints on culture differ greatly from one organization to the next. For example, the culture of a bank will differ greatly from that of a start-up.

How does company culture shape employee engagement?

High-performance company culture is directly related to employee engagement, as the culture clearly defines healthy and supportive values and behaviors. In such a culture, employees know what’s expected of them and how their environment positively influences their performance. They feel connected, involved, and supported. Owing to all these factors which build up a conducive culture, they tend to be engaged. To enhance employee engagement, begin by strengthening your company culture, and here are several methods to do so:

1. Clearly define company culture

Culture forms the heart and soul of your organization, and thus, you need a strong culture to foster strong employee engagement. To get started, the leadership team should outline:

  • Company’s mission, vision, and values
  • Employee behavior expectations
  • Define culture and document it as a presentation or on your Intranet system, or in an employee handbook. Make your document widely available once it has been created and follow up on your defined culture. All hands meet or virtual gatherings can be held for the same.

2. Conduct Employee Surveys

Regularly assess your organization’s culture. By doing so, you’ll:

  • Learn what works in your company culture and how you can improve it.
  • Give employees a voice and you’ll discover new ideas you might not have thought of.

3. Work on employee feedback

When you decide to engage employees’ feedback, the payoff will be immense. The employees will sense that they are helping to shape the company culture, and their engagement will increase. Communicate the actions you plan to implement based on their feedback. Hold focus groups to discuss your action plan. Encourage employees to participate in brainstorming sessions to generate ideas.

Also Read: How To Create A Feedback Culture In Your Workplace?


Creating a strong culture for employee engagement has its own set of challenges – more like an ebb and flow, as it is not a one-time task. For long-term value, your culture needs to be nurtured regularly and for the same, measuring culture and employee engagement is crucial. In the process, you shall understand how satisfied and committed an employee is to her job. 

By offering training regular sessions, managerial encouragement, and keeping an open mind about effective workplace practices, companies can meet the expectations of employees to create a high-performance culture. 

In a nutshell, employee engagement is an ongoing process and is inextricably related to company culture. Over time, you need to focus on employee needs, and then use that information to create a strong company culture.

Employee Career Development

Subscribe To The Engagedly Newsletter

5 Perks To Boost Employee Engagement and Morale

Employee morale and employee engagement go hand in hand.

If employee morale is high, then you can be confident about a high engagement rate. But consequently, when morale is low, engagement is impacted as well.

Continue reading “5 Perks To Boost Employee Engagement and Morale”