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Workplace
Work Culture Is Key to Stakeholder Capitalism
Workplace

Work Culture Is Key to Stakeholder Capitalism

Story Highlights

  • Stakeholder capitalism calls for organizations to deliver on brand promises
  • Keeping promises to all stakeholders requires a purpose-driven culture
  • Cultural transformation starts with defining and aligning with purpose

Today, people have higher expectations of the organizations they work for, purchase from or invest in. Employees, consumers, shareholders, suppliers, governments and communities demand responsible organizations that are grounded in purpose and committed to delivering long-term value.

In this world of heightened corporate social responsibility and the renewed shift toward stakeholder capitalism, the promises companies make must be kept. And the only way to keep brand promises is with a purpose-driven culture.

Unfortunately, less than half of customers strongly believe their vendors deliver on their promises, according to Gallup data. Customers that don't trust their vendor to follow through spend 13% less -- leaving those vendors with a missed opportunity to add real value to their partners.

When it comes to employees, only 27% strongly agree their organizations always deliver on their promises to customers. These employees not only lack fulfillment and engagement -- their unmet expectations inevitably lead to inconsistent customer experiences that leave brand promises unmet and customers disengaged.

In turn, global stakeholders lose trust in the organization's credibility and feel less committed to investing in the brand.

The solution lies in organizational culture. Culture bridges the gap between what an organization says and what it does.

Authentic cultures turn brand promises into action because employees are united behind a deeply held, genuine purpose.

Culture bridges the gap between what an organization says and what it does.

Gallup has decades of experience measuring people's perceptions, beliefs, emotions, needs and overall wellbeing. We use this human expertise to help organizations align their purpose and their culture. In turn, their employees believe in what their company stands for, which fuels them to turn brands into action and deliver experiences that customers, investors, and society can depend on, be proud of, and trust.

To Deliver Brand Promises, Strengthen Employees' Purpose

Global stakeholders will only believe in a company when its employees are true believers who behave "on brand" at every turn. To rise to this challenge, leaders need to build a purpose-driven culture -- and specifically, one that is energized by a compelling purpose for good.

When your purpose is well-understood and inspiring, your employees will live your brand because they'll be able to answer "yes" to the following questions:

  1. Our purpose motivates. Does your organization's purpose inform and inspire everyday decisions about how people spend their time?
  2. My job is important to our purpose. Does every employee understand how their work makes the world a better place?
  3. I am important to my company. Can each employee articulate their value to the company and its purpose?
  4. We are in this together. Is the commitment to purpose shared, creating a sense of belonging for collective high performance?
  5. We can win. We will win. Can you measure the social impact of achieving your organization's purpose to give credibility to the impact the organization is making?

Organizational Culture and Leadership: Four Actions for a More Trusted Brand

In Gallup's experience, the most successful organizations use the following culture strategies to ensure employees feel a heartfelt sense of purpose and ownership for delivering their company's brand promises every day.

1. Revisit your purpose to ensure it centers on your company's unique ability to meet a human need.

The best workplaces start by clarifying their purpose because it's the primary tool for aligning brand promises and work culture.

A great purpose is differentiated and people-oriented -- that is, it tells employees how their contributions uniquely make a difference in the world. A distinct purpose leaves customers feeling like they can't say no to doing business with you -- and it resonates deeply with shareholders and global leaders. Though many fail in this regard, it is only the beginning.

Beyond human resonance, your purpose should highlight how your company is uniquely positioned or capable to achieve the purpose. Too often, leaders propagate an aspiring purpose that sounds good on paper but doesn't make sense for their company. This creates a disconnect for employees -- who are left wondering how their contributions connect to the big picture.

It's up to leaders to develop and communicate a differentiated and human purpose that easily translates to the local level and employees' day-to-day experiences.

2. Harness proven metrics to unify your purpose, brand and culture.

After defining their purpose, leaders need to intricately and inextricably link that purpose with their brand promises and daily work culture. When your purpose, brand and culture are aligned, employees know exactly what to deliver -- and feel inspired to deliver it with the highest quality, every time.

This requires data: Leaders will be flying blind unless they understand how employees, customers, and all stakeholders view their purpose, brand, and culture. When this is done well, leaders know all their global stakeholders' perceptions of how well the company is delivering on its purpose and promises -- including investors, prospective customers, job candidates, communities and more.

This comprehensive approach to culture analytics is imperative because it tells leaders how their most important global stakeholders see their company. Leaders who narrow their focus to a single group's perceptions overlook stakeholders who have a right to be heard and who can offer perspectives that leaders need to succeed.

For example, how are you measuring customer engagement and whether customers believe you are delivering on your purpose and promises? Do you have consistent feedback about how you can better live up to your promises to the market?

Many organizations use purpose or brand metrics -- but often, these measures don't provide the tools leaders need to bring their purpose and brand to life. With in-depth culture analytics, leaders will not only understand their current state, but also the right cultural behaviors, processes, structures and systems for promoting alignment with purpose and brand.

3. Use disciplined accountability to drive real progress.

Leaders should also establish internal accountability that's connected to their culture metrics. For instance, who will be responsible for ensuring attraction, hiring and onboarding lead with the organization's purpose -- and how will you measure their performance? How will you consistently track your culture to maintain accountability and demonstrate sustainable value creation?

Because leaders set the tone for culture, the best organizations prioritize leader and manager education and development -- and maintain ongoing leadership alignment about their culture goals. In these workplaces, executives have a shared dedication for sustaining a purpose-driven workplace.

The best leaders also tie managers' performance expectations to business and purpose outcomes -- that is, they hold managers accountable for how well their teams actualize brand promises.

4. Enable managers to scale culture through the front lines.

Managers bring culture to life for employees. Great managers motivate every employee around the company's purpose and create clear standards for bringing brand promises to life. They also make strategic decisions that support the company's reason for existing.

To this end, the best workplaces name managers who are innately talented people leaders. Too often, companies select managers based on tenure or success in a non-managerial role -- in fact, organizations choose the wrong manager 82% of the time.

In addition to evaluating (and optimizing) manager selection, it's also vital that leaders develop their managers to become coaches. With the right development, managers can build thriving relationships and bring out the best of their teams -- and, consequently, foster trust, open dialogue and full transparency. These managers point teams toward the right performance objectives, driving the purpose of the organization and instilling a sense of unity and belonging.

When your purpose, brand, and culture are aligned, employees know exactly what to deliver -- and feel inspired to deliver it with the highest quality, every time.

If your employees don't believe you deliver on your promises, the world won't either. When these culture strategies are done in concert, you build an "on brand culture" at scale, where every employee believes in the organization's promises and consistently delivers the brand for every stakeholder. Keeping your promises to all your organization's stakeholders starts here. Get culture right and you will create value like no one else can.

Build and sustain an organizational culture that delivers value to every stakeholder:

Author(s)

Jake Herway is a Culture and Change Subject Matter Expert at Gallup.

Bailey Nelson contributed to this article.


Gallup https://www.gallup.com/workplace/343361/work-culture-key-stakeholder-capitalism.aspx
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