Salary, benefits, vacation time—these are all important factors that will determine your firm’s ability to attract and retain high-quality accounting talent. But perhaps the most important factor is one that’s often overlooked: company culture.
So how do you determine the current culture at your business? And if you don’t like what you find, how do you change it? Read on to find out.
What is company culture?
Company culture is a difficult concept to define and quantify. Perhaps it’s best to break the term into two parts: external culture and internal culture.
External culture is how your firm is perceived from the outside. Its values, brand image, relationships with customers, and commitment to community service all combine to create these perceptions. External culture is probably more important in the hiring process—how your firm is viewed from the outside will play a large part in a candidate’s decision to join your team.
Internal culture is comprised of all the factors that affect the daily lives of your workers. Corporate structure, performance reviews, recreational outings, office hours, dress code, and even the architectural design of the office itself are all aspects that make up internal company culture. Internal culture plays a greater role in retaining employees after you’ve hired them—the more they like the culture and feel it fits with their personal work style, the longer they’ll stay.
The Organizational Culture Assessment Instrument identifies four different types of company cultures. Those are:
1) The Clan Culture: Your business operates like a family, with leaders seen as mentors and facilitators rather than bosses.
2) The Adhocracy Culture: Your business thrives on risk-taking and experimentation and gives employees the flexibility to achieve tasks in their own unique way.
3) The Market Culture: Your business is focused heavily on results, with leaders driving employees hard to meet high expectations and even compete with each other.
4) The Hierarchy Culture: Your business is formalized and structured, with strict policies and tight procedures keeping work flowing like a machine.
None of these are the “right” or “wrong” culture—the one that works best for you will depend on a variety of factors including your strategy, market share, business size, etc. And in all likelihood, the ideal culture for your business will be some combination of the types listed above.
How does culture affect the bottom line?
It’s easy to see how culture can impact your ability to attract and retain employees, but what about the bottom line? Does culture have a direct influence on your company’s ability to achieve business results like higher sales or bigger margins?
In a word: yes. Study after study has shown that companies with strong external and internal cultures are more competitive on the business battlefield.
“If your culture feels positive, then people are likely to be more motivated, efficient, and focused on meeting their objectives,” says Jennifer Wilson, Co-Founder, CovergenceCoaching, LLC. “A positive culture produces positive results – and a negative culture inhibits achievement.”
A study authored by Duke’s Fuqua School of Business found that more than 50% of surveyed CEOs and CFOs believed corporate culture impacts productivity, creativity, profitability, firm value, and growth rates.
“Culture provides the operational efficiency in teamwork, product knowledge, and consistency that allows for setting big goals and achieving them,” says Quint Studer, Founder, Studer Community Institute. “An experienced team that is well-aligned, skilled, and experienced outperforms others.”
How does culture uniquely affect the accounting industry?
Culture can be particularly tricky in the world of accounting, both for internal accounting departments within larger businesses and dedicated accounting firms. This is partly because accounting is often perceived as an impersonal field—it’s about technical accuracy, quality, expertise, specialization, timeliness, budgets, etc. When dollars and cents are the focus of the work, the people performing that work tend to fade into the background.
But relationships and culture are still vital to the accounting field, and will directly impact your firm’s ability to attract and retain employees. Personal culture can seem contradictory to the highly-technical, numbers-and-results-based nature of the industry, and navigating that divide will be crucial to your company’s success.
“Accounting is both a technical and a people business,” says Wilson. “Firms have to ensure that their cultural definition, the training they provide their leaders and people, and the way that they structure their incentives don’t allow one to outweigh the other.”
According to Wilson, favoring results over people or vice-versa may have a disastrous affect on accounting teams, creating an “environment where the contradictions make things feel impossible or hypocritical.”
How can you improve your company culture?
If quantifying culture is difficult, finding ways to improve it may seem downright impossible. A company’s culture is the result of thousands of individual decisions that were probably made over the course of many years. Changing it won’t happen overnight or with a single initiative. Still, there are concrete steps you can take to improve both external and internal culture at your firm.
The process should start with gaining a better understanding of your current culture, including both its positive and negative attributes. Conduct a survey (preferably by a 3rd party) among customers and employees to get feedback on how your business is currently perceived.
“Most CEOs talk a good game but don’t spend near the time needed to measure employee engagement as well as track employee turnover by leader,” says Studer. “If organizations focused as much time on leader skill building and employee alignment and engagement as they do cash, they would have more cash.”
Once you have an idea of your current culture, decide what kind of culture you want to have. There’s no one-size-fits-all answer to this question: some companies do well with a culture that’s laidback and flexible, others thrive through hyperactive competitiveness. Find the gaps between your current culture and the one you want to achieve, and develop some strategies to fill or erase these gaps.
Above all, be patient. “Culture is made up of so many things – strategies, people, processes, procedures, written and unwritten rules, and stories,” says Wilson. “Shifting your culture takes time, intention, and the courage to drive change one person and process at a time.”
Accountingfly offers a number of solutions that can help you improve your marketing and brand perception—important steps in boosting company culture. And we can help you put your culture on full display to attract better accounting job candidates. Click the link below to learn more.