When Italian pasta giant Barilla acquired a 178-employee Canadian pasta manufacturer last year, the employees at the smaller company were understandably concerned about what roles they would play in the new, massive organization.
Would they be forced to change their way of doing business? Lose their seniority? Lose their jobs altogether?
It might have been easier for Barilla, with its 8,000 employees, to simply absorb the smaller Catelli staff without considering the differences in their workplace cultures. But that’s not the message Barilla wanted to send.
“The most critical aspect was ensuring that these employees didn’t feel lost in the mix—that they weren’t just a number in this transition,” says Laura Birk, vice president of HR at Barilla America Inc., headquartered in Northbrook, Ill.
Barilla executives also admired how Catelli, previously a competitor, did business. It made sense to explore what pieces of the Catelli culture Barilla might want to incorporate into its own. And, at a time when companies are finding it tough to hire skilled employees, especially in manufacturing, Barilla wanted to keep as many Catelli employees as possible, Birk says.
As a result, Barilla’s HR team worked hard to make the new employees feel welcomed and respected, relying on lessons learned from previous culture-building work at Barilla plants in New York and Iowa.
Immediately after the merger was announced in February 2021, Barilla’s leaders held a town hall meeting with the new employees to answer questions. They also made key announcements to set a tone of fairness. For example, they said they would conduct an equal pay analysis for the new employees and financially invest in the Montreal plant they’d acquired from Catelli, the first major investment in the plant in 20 years.
“Addressing tough change questions—Will I lose my job? How will my position change?—proactively demonstrated our culture of transparency and feedback,” Birk says. “I’m proud to share that we were able to keep retention high and turnover low during and after the merger.”
Mergers are naturally a time when thoughts about a company’s culture come to the forefront. But even absent a merger, workplace culture has become a focus for employers. It has taken on even greater importance since the pandemic hit and the Great Resignation sent millions of employees heading for the exits in search of better pay, benefits and workplace flexibility. Meanwhile, 72 percent of executives are worried that the increase in remote work will take a toll on company culture, Mercer’s 2022 Global Talent Trends Study found.
Company culture is truly the DNA of an organization—what it values, what it believes in and how willing it is to meet its own standards in day-to-day operations. While no company will ever be 100 percent consistent with its stated cultural values, and not every idea will be a winner, there are steps organizations can take to create and maintain a culture that makes the company a desirable place to work.
Why Culture Matters
Too often, company culture is considered ancillary—the cherry on top of the “real” company objectives, or the fun perks and benefits that lure in top talent. But company culture shouldn’t be separated from key business goals, according to Birk.
“An engaged, inclusive workforce is one and the same as a more productive workforce,” she says.
According to Sophie Theen, author of The Soul of Startups: The Untold Stories of How Founders Affect Culture (Wiley, 2022), a company that prioritizes its culture is one that “nurtures its employees, is committed to its mission and is resistant to challenges. It’s a longtime sustainable company, not one that is just here for the good times.”
Culture, then, is not merely the vibe that exists as employees perform their jobs. Instead, it’s the nexus of what the company values and how those values drive performance and boost return on investment for the organization over the long run. And it’s critical in attracting and retaining employees. A 2022 FlexJobs survey found that 62 percent of people who had recently quit their jobs said they did so because of a toxic culture.
“Simply put, culture is the workplace experiences that both shape beliefs and drive actions and results,” says Dustin Staley, managing director of health care at Culture Partners, a 50-employee consultancy based in California.
As a result, organizations need to think in ways both human-oriented and business-centric.
“To shape culture, you need to create clarity around the most critical organizational results you’d like to achieve,” Staley says.
Companies hoping to reduce turnover should dive into what drives employee retention—and what drives employees away—and adjust benefits, workflow policies and management approaches accordingly. Organizations aiming for a greater variety of perspectives will want to evaluate their hiring practices and decide if a more diverse collection of internal voices could shake up the way key decisions are made.
The bottom line is that “culture is not an add-on,” says Jason Barger, author of Breathing Oxygen: How Positive Leadership Gives Life to Winning Cultures (Amplify, 2022). “Culture is everything—the greatest competitive advantage organizations have to retain, attract and develop talent.”
What’s the Goal?
The first step to define company culture is for an organization to determine its philosophy. The natural starting point is identifying the organization’s deepest values. There’s a good chance most organizations have already defined their values through mission or values statements or even in job ads.
If an organization doesn’t have a list of company values, now is the time to create one. These values should outline how the company wants to treat its employees, how the company wants to be perceived as a brand, how employees are expected to represent themselves and how employees should feel working for the company.
Ideally, this would be a joint effort, with employees contributing ideas. Small task forces, town hall meetings or quick pulse surveys can all help employers gather employee feedback. More involvement means more buy-in, says Susan Hostetter, SHRM-CP, executive vice president for human resources at TAB Bank in Ogden, Utah. It also helps close the divide between what company leaders think employees want and what they actually want.
Barilla, for example, set a goal to promote better work/life balance for its employees. To help achieve that, the company established a Digital Day—a day when the company ensures employees have the technical help and tools they need to make hybrid work more effective. While Barilla provides support in this area year-round, once a year it becomes the day’s entire focus.
Of course, it’s also critical for companies to back up any words with actions. If workers are constantly being pinged with questions while on vacation, an organization’s “time off means time off” policy won’t ring true. A company’s real culture is reinforced every day based on the dozens of cues that management sends to employees, all of which teach them how to exist within the organization.
“Company culture isn’t created by offering free lunches or pingpong tables,” Hostetter says. “It is how employees feel within the social norms at the company—what behavior is acceptable and understood by employees.”
For their part, employees say the top three areas where they experience their company’s culture are the mission or values statement, employee recognition or celebrations, and the approach to employee performance, according to Quantum Workplace’s 2022 Organizational Culture Research Report. Something as simple as announcing promotions and lateral transfers can help with employee retention, Hostetter says.
“If employees know their growth is within their control, they will seek opportunities within your organization to expand and they won’t have to leave the organization,” she adds.
It’s up to companies to decide which signals they most want to send about their culture and how they can be consistent across the organization. For example, if they want to send the message that they prioritize their employees’ mental health and time away from the office, they need to reinforce that belief in writing and policies. That could be as simple as requiring every manager to designate a “support” employee (or themselves) as backup when another employee is on vacation.
Inconsistency is among the major barriers of workplace culture creation. If one manager maintains an easy, relaxed vibe during team meetings while another demands detailed status reports and chides those who have fallen behind, a unified company culture doesn’t exist. Company culture can and must leave room for different work styles, but top leadership needs to be clear about what types of behavior are encouraged and what kinds are unacceptable. Or, as Hostetter puts it, “Words on paper or the lobby wall mean nothing if they are just words.”
The Role of HR
One of the greatest misconceptions about corporate culture is that creating and maintaining it falls within HR’s exclusive purview—a “soft skill” that exists outside the realm of strategy and workflow. This is patently untrue, Staley says. Culture shifts should not be HR’s sole responsibility.
“HR leaders should engage [company] leaders to own culture management,” he says, since the ultimate benefit of a robust culture is a stronger company as a whole.
But Staley also acknowledges that HR professionals should play a major role in shaping workplace culture and reinforcing it through employee interaction and management coaching. HR can think of itself as a driver of management buy-in, drawing a clear link between culture preservation and greater business success. HR also greatly influences company culture by ensuring that company systems—hiring practices, promotions, rewards programs, evaluations—are fair and match the company’s intended culture, Staley says.
“They should also be looking for any systems that contradict the intended culture and voicing necessary adjustments,” he adds.
Another essential task for HR: Gathering intel from folks on the ground. HR leaders should regularly solicit feedback, listen to that feedback, assess feedback trends, create action plans to address the input, and close the loop by telling employees how the company reacted or plans to react to their feedback, Hostetter recommends. Employees want to do their jobs well and want to be heard, she adds. Ask them what they need and they’ll be happy to share.
“The worst thing to do is ask for feedback and then do nothing with it,” she says.
Mergers and acquisitions can create complex challenges when it comes to culture creation. Barger points out that doing nothing and hoping for the best is never the answer.
“When nothing proactive is done, the culture that wins out is the one that came into the merger with the greatest clarity and alignment on how they operate,” Barger says.
If processes and values don’t match up between the merged organizations, it can lead to confusion and mass departures of talent.
That’s why culture should never be left to chance. Staley learned this lesson firsthand when Culture Partners worked with a health care tech company that purchased a smaller organization.
“The purchasing company had a strong company culture,” Staley says. “But they recognized that the smaller company also had a strong culture with strengths they did not have, and vice versa. For example, the smaller organization was more nimble and able to pivot. They were able to bring the best of both cultures together and create a stronger culture overall.”
During the merger between Barilla and Catelli, Birk and other leaders relied on employee resource groups (ERGs) to help new employees feel welcomed and get to know their co-workers. These employee-led groups are usually formed around a shared background or interest such as gender, race, location, hobbies or volunteer activities. Barilla’s ERGs are very popular—60 percent of salaried employees are actively involved in one, Birk notes.
At the first town hall meeting with former Catelli employees, Barilla leaders explained how the company’s ERGs worked and how to get involved in one.
“We’re consistently providing forums for community bonding,” Birk says.
While it might seem that working in separate locations could weaken a strong workplace culture, that’s not a given.
When a company has a strong, positive culture, having remote employees usually doesn’t make it more challenging to sustain the company values, Theen says. For example, if a company has transparency and honesty at its core, employees can continue to speak and share freely even in a virtual setting.
The challenge, then, is creatively shifting approaches to maintain the existing foundations of that culture. Sometimes doing so is as simple as making time for small talk.
“We try to take a few minutes at the beginning of a team meeting to share personal stories, like we would when we were gathering in a room waiting for everyone to arrive,” Hostetter says. “We all need to remember that we are human and want to feel connected to others.”
Birk acknowledges that it may be easier to fall through the cracks when working remotely, and says this calls for companies, including HR leaders, to work harder to keep employees engaged. That’s especially key considering disengaged employees in the U.S. are 3.8 times more likely than engaged ones to cite company culture as their reason for leaving a job, according to the Quantum Workplace report.
“When I’m in the office, it’s easy for me to sit next to someone at lunch who is new or might still be building relationships,” Birk says. “I can’t do this when I’m at home. That’s why with hybrid and remote work, it’s more important than ever to have employees involved in programs that promote and facilitate connections with colleagues.”
At Barilla, that involves affiliation groups for employees of color and those who identify as LGBTQ+, along with informal Microsoft Teams channels for employees to chat about everything from books to family vacations. It may not be an office happy hour, but it does help foster connections.
Top leaders are expected to participate in social programming events, as well. This fall, Barilla America’s president, Jean-Pierre Comte, jointly hosted a Hispanic Heritage Month event with an employee of Puerto Rican descent to talk about Puerto Rican heritage and cooking.
At the end of the day, as with any major managerial change, crafting a strong and successful company culture takes time, collaboration and a willingness to be honest about the state of the organization.
“The biggest takeaway and the biggest challenge are one and the same: Building a corporate culture requires a combination of immense patience and relentless dedication,” Birk says. “It happens in progressive steps, and there are no shortcuts.”
Kate Rockwood is a freelance writer based in Chicago.
Illustrations by James Boast.