Why is organisational culture so important?

In my previous article, I gave some definitions of organisational culture which we can loosely say covers the social and emotional ways of doing things that emerges from a network of people working towards a common goal. To continue the story, I want to look at why getting culture right is so important to an organisation and why all leaders should be taking this seriously.

Broadly, I want to cover the following three key areas:

  • Employee wellbeing
  • Short and medium-term operational efficiencies
  • Long-term organisational wellbeing


Culture is Important for Employee Wellbeing

Put quite simply, a good organisational culture can greatly reduce negative factors like stress. Although we still have a long way to go, nowadays there's a lot more awareness of the importance and impact of mental health to an individual. We spend a lot of our time and energy at our workplaces, so living in an uncomfortable situation can have a huge impact on our lives. It's also important to realise that this spills over to impact the lives of our families too.


What is stress?

‘Stress’ is a physical response to a situation, it’s the ‘fight, flight or flock’ response caused by the more primitive parts of our brains. It causes physical changes such as an increased heart-rate, increased breathing rate, muscles tensing and sweating. It also reduces the function of our higher cognition areas, making it harder to form more complex thoughts but much faster to perform emergency life-or-death responses. From an evolutionary perspective, it’s literally designed to keep us alive when things go badly wrong (such as the sudden appearance of a predator).

Once the threat moves on and the situation is no longer dangerous, the feelings should subside. The difficulty we have is that these mechanisms are considerably out of date for our modern lifestyles. Most of us don’t encounter lions or tigers during our daily office lives, but work-based pressures function exactly like triggers for this response. The biggest problems then arise when the triggers are too frequent, so our bodies stay in this high-alert state.

For more information about stress, I suggest starting with this NHS guide and this guide from the charity Mind.


The controversial myth of stress and productivity

The stress-performance curve has a very weak scientific basis and is probably not applicable to humans. It’s a pretty graph though.

You’ve probably seen a graph like this before. They’re very common in management and motivation workshops. The concept behind it is that we need a bit of pressure, or stress, in order to get us going and that as pressure increases there’s a level at which we’ll operate at optimal efficiency, before being so overstressed that we can’t do anything.

This is known as the Yerkes and Dodson Law (YDL). It originates from a paper by the two scientists in 1908, in which they performed experiments on mice to see how their task performance was influenced by electric shocks of increasing power. The results weren’t exactly conclusive. However, in the more than one-hundred years since then a series of assumptions were made, the theory was upgraded to a ‘law’, and transferred from electrocuted mice (and kittens!) to stressed-out humans.

Unfortunately it seems that nearly every step of the way went against actual evidence that indicated an increase in ‘stress’ only leads to a decrease in performance for humans. This has been compounded by an expansion of very vague terms and its mix into popular folklore. After all, who isn’t more efficient when working towards a close deadline?

There may be some useful common-sense truths behind the curve, but the real danger is that by perpetuating the theory without critical reflection we risk doing actual harm. For example, it can be used by managers as validation that they must exert some pressure on their team, to cause enough stress that they reach an optimal performance level. In comparison, current evidence suggests that more supportive and transformational management styles can both reduce stress and improve performance (e.g. this paper by Sosik and Godshalk, 2000, or this one by Lyons Schneider, 2009, or this by Rowold and Schlotz, 2008).

For more information, I highly recommend this paper by Corbett, 2015. Most of the facts from this little section are based on his paper, it's well worth a read - especially as a reminder of human fallibility and the importance of questioning established practices.


The negative effects of too much stress

The long-term effects of high stress levels are actually quite frightening. Stress in the workplace has been linked with an increased risk of very serious health issues, such as:


Causes of stress in the workplace due to culture

Given the dangers, what can actually cause stress within the workplace? The Health and Safety Executive identifies six main areas:

  • Demands – nature of work, match of skills required with capabilities, workload, work patterns, environment
  • Control – the level of control the employee has over how and when they do their work, their role in decision making
  • Support – the level of encouragement, support and resources that employees receive to do their job
  • Relationships – communication, behaviour and interactions between individuals
  • Role – how well people understand their role within the organisation
  • Change – how organisational change is managed and communicated

I’d also add things like job security to the list. It’s clear though that probably the majority of these areas stem directly from culture. While many Demands would be related to the actual work, aspects like workload, timings and breaks, holiday allowance, and working environment are all culture related. Control, and perhaps autonomy under this heading, and Support can certainly be down to management styles and culture. Relationships and communication form an important part of what we look at in our practice – while the connections are made due to production and practical requirements, their quality and effectiveness are at the very heart of what culture is about. I would probably group Role within Relationships as it’s quite fundamental to the communication network. Change is important to keep organisations relevant and competitive as markets and technologies change – the focus is usually on strategy, but how it’s implemented and communicated is certainly cultural.


Conclusion: Culture is Important to Employee Wellbeing

So stress is a natural response and the long-term effects are serious to our health and wellbeing. Unfortunately, stress is triggered by work and, of the triggers we’ve looked at, seems to result from culture. We therefore argue that as part of the duty of care that every employer has, that we should seek to reduce stress in the workplace by looking to improve our culture.



I'm still in the process of writing this article, so if you'd like to have a chat about any of this please connect with me on LinkedIn or contact me.

~~~ Last Updated: 5th December 2018 ~~~