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Updated: April 24, 2024

How small businesses can build a strong company culture

Published By:

Erin Ellison

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Estimates say that we spend more than one-third of our lives at work. That’s as much as (if not more than) we spend with our family and friends. Yet, despite all the time and energy we put into our careers, only 40% of us report being truly engaged at our jobs. As someone who runs a small business, there is something you can do to not only increase employee engagement and morale but also improve your recruiting efforts: develop a strong company culture. And it can lead to lower turnover and increased employee productivity.


So, for employers looking to move their organization forward, it can be part of your overall strategy to stand out from the competition.


Let’s start at the beginning to help build a strong company culture for your small business.

What is company culture?

Company culture is your company’s character and identity — intangible things like whether employees feel valued at work and tangible things like your choice of office space and decor. It’s driven by the values and goals that you and your employees share, regardless of what department they’re assigned to or what shift they work. And it isn’t limited to tech giants with ping pong tables and catered meals. Snacks are nice, but they won’t keep anyone in their job if they dread getting out of bed every morning.


A study from Glassdoor found that 56 percent of workers said that a strong company culture is more important to them than their salary. And 77 percent of workers in that same report said they consider a company’s culture before applying for a job, while 65 percent of respondents said their company’s culture was a main reason they continue to work there. A survey from Randstad found that 38 percent of workers want to leave their jobs because of a toxic culture or feeling like they don’t fit in. Company culture is an essential part of your ongoing HR success.


Building a great company culture is the result of a lot of small acts. It can be as simple as whether your team holds everyone accountable to refill the paper in the printer or making sure every new employee has a great first day — but it’s also a big part of your HR infrastructure and work environment. And having a culture doesn’t mean being huge or all being best friends or even all working in the same place.


Even if you only have two employees, you have a culture. Here are five steps to start developing a strong company culture

Define your culture (even if it’s loose)

The first step in shaping your company culture is to determine generally what it is. Get your leadership team together to talk about your values, vision, and why you’re all there. Or if you only have a few employees, simply ask yourself: How do I want to run this business? And how should we treat customers?


Identify three to five core values that should be evident around the workplace. They could be:


  • Virtues, like honesty, empathy, or diligence
  • Ways you present yourself, like being upbeat, fun, focused, or serious
  • How you solve problems, like being innovative, scrappy, or experienced.


Here’s an extensive list if you want help getting started — just pick a few that fit. It’s OK if you don’t quite live up to them every day, but you should make sure they’re at least somewhat realistic because the ultimate goal will be to ask yourself to ask whether different things your company does live up to those values. Make sure you write them down so they’re not just another one of your big ideas.


Get feedback

Big companies can spend a ton of money to define the perfect qualities and optimize their workplaces, but there are simpler ways to go through this process. It’s a good idea to ask your employees for recommendations before you set anything in stone. Take the time to ask them for:


  • Three adjectives they’d use to describe your company (to compare with the values you have in mind)
  • Their opinion about the environment you’ve created
  • How well they think your company operates
  • Any changes they’d like to see
  • Whether they feel a sense of ownership over what they do
  • Whether their ideas are heard
  • Whether they feel empowered to do their job well
  • Are they frustrated by things like the number of meetings, the overabundance of emails, or anything about their physical environment?
  • If they would like more benefits, more opportunities to gain new skills, or things like payroll deductions for charitable giving?


Make your questions specific to your business and what you think employees’ concerns might be. And keep the feedback anonymous by using a free online tool like SurveyMonkey or Google Forms to collect answers.

Document and communicate your culture

Once you’ve got a clear picture, it’s time to pull it all together. The feedback you gathered should validate and help you refine the values you initially identified.


Now it’s time to write them down and share them with your team.


Documenting and explaining your culture to employees can take several forms, but it really is a good idea to do it in a concrete way and to take the  time to show each employee how their role impacts your success and the culture you are working to build. To be effective, you should probably:


Write a mission statement. Turn your culture values into a mission statement by explaining what you do and how you do it. You can follow this template if it helps: “Our company gives customers [the benefit of working with you] by [doing what you do] with [your values].” If you’re a pediatrician, maybe you’d say, “We help parents raise healthy kids by providing top-notch health care with skill, empathy, and enthusiasm.” Or maybe a landscaper would say: “We help homeowners enjoy their time at home more by using our diligence, knowledge, and love for plants.”


Tell employees about it. Explain your mission, what your values mean, and talk it through with employees as a group. Then add your values to your employee handbook to make it easier to share with new hires and refer back to when you feel things are going off track.


If there’s anything about the way your company operates that doesn’t align with the culture you’re trying to create, it’s also a good time to make changes — big or small.  If one of your traits is thoughtfulness and people don’t refill the printer paper, that’s something to address. If you’re supposed to have a “fun” culture that brings a sense of wonder to customers, how do you also bring it to employees? Or if hard work is one of your values, how do you encourage and reward it?


Remember, you’re all in this together. Building rapport and a sense of community with your employees goes a long way towards strengthening your culture, so also make sure you hear what they’re saying, listen to their questions and be ready to be flexible. Culture is something created by a group — it can’t be unilaterally imposed.


Live your culture by valuing their work and showing your appreciation

Show your staffers that you value their contributions and teamwork. And in the process, try to encourage the values you’ve outlined.


To get buy-in, you also are going to need to build (or build upon) trust with your team. It can start with trusting them to do their jobs well, giving them a high five when they do, and asking for feedback about how you could do better. But it can also include more formal programs like job performance rewards and recognition awards. Or just pizza or bagels now and then for the team to enjoy together. Tie these programs back to your values.


For example, if your team works remotely, reward good communication. If you value skill and experience, have everyone celebrate when someone gets a professional certification or developmental milestone. If you value work-life balance, then encourage and celebrate personal milestones outside of work — like running a marathon or completing a fundraising goal.


It’s also important to empower your employees to recognize one another for outstanding performance or just getting the job done because not everyone is great at tooting their own hard-work horn.

Hire to your culture

Recruiters will often tell you that you should hire for “fit” first, and then train for skills. You can teach many skills, but when you hire someone who doesn’t mesh well with the team, you risk them wreaking havoc on productivity — plus upping the likelihood that they’ll leave after a short period of time.


Consider including your current employees in the interview process. Not only will that give candidates a better idea of the role and your company culture, but it will also help your employees feel more included in the process. And in interviews, ask for examples of how they exhibit the values your company is looking to build around.


An important follow-up to interviewing and hiring is your onboarding process. Onboarding is the best opportunity you’ll have to help new employees seamlessly integrate into the company starting with their first day.


Those are five steps almost any business owner should be able to start to implement without too much work, but there can be wrinkles to building a culture in certain environments. Here are a few more things that may affect your efforts.

How do you create culture in a remote team?

Even if your team is distanced, the same essential rules to maintaining your company culture still apply. Here are a few things to consider when you can’t gather around the water cooler to catch up.


If your team is new at working remotely or could use a little refresher, here’s a resource to help establish your work from home policy. Some things to think about: What will be the expectation for “regular” company hours when everyone works from home? How will human resources issues get addressed? How will you shout out successes?


Put technology and tools like messaging, video chat, and project management apps to work to build communication and foster collaboration. And determine how your team can best use them. Some companies schedule short, daily calls to check in and sync up on projects while others meet weekly via video call and then have separate one-on-ones.


Don’t forget to praise great work and take time for small talk during these calls or check-ins. There’s value in virtual high fives that the whole team can enjoy as well as the chit chat and meme fun in between projects.


However you choose to develop your team and culture from a distance, make sure that everything is as transparent as possible. Trust and communication are essential to building a strong work culture, and even more so when you’re all in different locations.

How do you know if you have a good company culture?

study from Deloitte found that 88% of employees and 94% of executives believe that a “distinct workplace culture” is important to a business’s success. But it can be hard to have a clear perspective on your company culture, especially when you’re in it every day. Keeping an eye on the following numbers will help you stay on top of how your people feel about your company and if you are all truly embodying your values and mission.



Employee referrals

Employees are more likely to suggest that their friends and colleagues come to work at a company if they’re happy working there. Changes in the rate of employee referrals are a very clear indicator of the health of your company culture.




Employees are less likely to leave a company where they feel like they fit in and can do good work. If you’ve had a lot of people come and go lately, it’s time to take the temperature of your team and how they feel about their work environment. Make sure you are tracking turnover closely, and don’t be afraid to conduct exit interviews. When people are leaving, they are more likely to be honest about how they feel about the company, management, coworkers, and their role.


Employee engagement and (more!) feedback

Give your employees a chance to let you know what they think of the company. Hopefully, they will tell you what they like so you can enhance what you have in place — and change what isn’t working. Listening to their feedback will also let your team know that you take their opinions seriously and are committed to strengthening your company.


Building a strong company culture can be done well at any size business, on any budget, and in any type industry. But it isn’t developed in a day. Building, strengthening, or changing company culture may not happen quickly, but the good news is that the efforts you make will be noticed and appreciated by your employees — and likely impact your bottom line more than you expect.

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Erin Ellison is the former Content Marketing Manager for OnPay. She has more than 15 years of writing experience, is a former small business owner, and has managed payroll, scheduling, and HR for more than 75 employees. She lives and works in Atlanta.