Culture is the fuel behind exceptional organizations. It’s not the variable seen, and yet it plays a crucial role in facilitating the outcomes shared in winning quarterly earnings reports shared by CEOs. 

When asked, people struggle to define it, often pointing to a mission or set of values, which are key but don’t feel exact. Part of the challenge is that culture is spoken of as a fixed entity — a plaque on the wall, a mission statement framed at the front of the office.  The reason this is hard is that culture is less about what an organization says, and far more about what people feel about what is done. 

Culture is a feeling and not a thing. To leverage culture for performance, organizations should harness the feeling that motivates excellence. When employees are motivated this way, a company has created the DNA of exceptional organization anchored by an exceptional culture. It’s with this emotion that organizations can unleash the talent of their people and charge them to make great decisions on behalf of the company. That’s when culture is alive!

Describing a culture can be a challenge because it’s intangible. People often default to talking about flexible work styles or kitchen snacks—tokens that signal culture but don’t define it. The better clue is how it feels to work there. While culture includes purpose, values, leadership behavior and rituals, it only becomes real when those elements generate a feeling that drives performance. These elements describe what organizations do and that is important, but it doesn’t get real until the sum of these things lead to a feeling that inspires great work. 

Culture became real for me when I worked for a large financial services company. During a meeting, a team quickly dismissed a marketing idea that didn’t serve clients well. The founder had built the company on trust and accessibility for everyday investors. As the meeting ended, someone noted that this decision reflected our culture—doing what’s right for clients. No memo required. That shared clarity empowered us and offered a glimpse as to how an organization could achieve greatness. It showed how a strong culture enables people to do great work by instinct.

Creating that kind of culture is challenging. It requires answering one key question: What creates the feeling that excellence is expected and supported? There's no universal formula, but three cultural elements are foundational:

1. Clear rewards

The most powerful way to shape behavior is through meaningful rewards. Humans are wired to seek reward and avoid punishment. If your culture is to drive superior performance, the reward for what you value most must be clear to employees. The reward is not always financial. Consider large brands like Fedex and Home Depot, where long term employees can be rewarded with advancement without having to have a college degree. This is meaningful and can be felt in those organizations where you will find many long tenured employees. Home Depot employees can be seen wearing their service badge on their aprons in the stores. The employees are proud of their service.

This example is similar to my experience at the large financial services company. The reward was not financial, it was pride. It was knowing that the decision to support clients would be appreciated by the founder and the leaders. Even if the story was never told, the action put the participants in a lauded class of employees who were acting on behalf of investors. 

The reward of membership to the special group of employees who care about clients and have the stories to prove it, is belonging in the culture and a true reward. Both these examples illustrate that creating a reward that is cultural and powerful has complexity. It is not transactional but motivated by deep emotion. It is important and why creating a culture that moves people to act is more than a notion.  

2. Leadership behavior 

This is often where organizations fall short. The emotional intelligence of leaders and their ability to create followership will determine how well employees will be treated, which is directly related to their discretionary effort. Hierarchy doesn’t drive performance. Trust and respect do. 

Adults assess this quickly and decide what they are willing to contribute. Too often, poor leaders are left in place because senior leaders miscalculate how much it matters. Sometimes leaders believe poor approaches can justify the ends if results are obtained. If outcomes matter more than values, then everyone knows it. Once it’s clear that values are not truly lived, it all falls apart. 

Organizations too often look at leader behavior as a nice to have instead of essential. It is impossible to achieve extraordinary outcomes with leaders who are less than excellent. It’s not that the company has not chosen great values, it’s that the company has chosen leaders who fall short of leading with those values. Without leaders, employees aspire to be, the organization is limited in how high it can climb. 

3. A Clear and Shared Purpose

Purpose would seem to be easiest of the elements, yet it can be the most elusive. Consider my experience at the financial services company. If we had the wrong employee in the room with the wrong motivation, that team could have decided to market a poor product to clients with less than desirable outcomes. If a news outlet would have reported this, it would have tarnished the company brand and damaged the trust that took years to build. The long term, financial impact would be significant. 

It is easy to lose this focus. How does a company create it and maintain it? Having clarity of purpose must be cultural. This means whatever the organization holds central, it must be reinforced and rewarded often. Companies can do this by setting the practice of asking the central question in every meeting or important decision. It can be described as cultural when everyone in the room knows to ask the question and are stepping on each other to ask it. There are never guarantees that this focus will work, but removing any ambiguity is an important sustaining step.  

To be clear, culture doesn’t create excellence—people do. The role of culture in an organization is to provide the environment and pathway that facilitates the outcomes that matter. Every company will have the good fortune of having some extraordinary employees. When an employee achieves something special, it is seen as facilitated by the great culture and not in spite of the bad one. 

Culture can be measured in how people feel about working there and making their best contribution to the purpose. It’s not measured by the number of free snacks in the breakroom. Those things are nice, but they sit on the fringes of great culture.  Few have expressed great emotion because the snacks were free. Perhaps a little kid-like delight, but that emotion is fleeting. The feeling that drives an employee to find the best possible solution is deep. It is about caring. The outcome matters. That deep emotion—the one that inspires a person to go the extra mile and make their best contribution—is what makes culture the core.