Organizational Wellness

How Workplace Culture Affects Employee Morale and Productivity

Feb 9, 2021
Last Updated Feb 26, 2024

Workplace culture is an important topic for business leaders to consider when they want to lead and grow their companies.

Healthy workplace cultures have the power to boost employee morale, which leads to increased cooperation, higher productivity, and reduced turnover. Boosting morale and productivity impacts your company’s ability to achieve its goals.


The Importance of Workplace Culture

Workplace culture, or company culture, is the personality and character of your business. It is the total sum of your company values, beliefs, behaviors, attitudes, traditions, and interactions.

The culture of your workplace has a significant impact on your employees and your business, whether positive or negative. Ninety-two percent of leaders from successful companies believe financial performance and workplace performance are closely related.

Here are some more specific reasons why cultivating a healthy company culture is important:

It Increases Employee Engagement

Work environments that possess good workplace cultures are driven by purpose and clear expectations. When employees understand what they are doing and why they are doing it, they are more likely to be engaged with their work duties and interact more with their co-workers.

It Decreases Employee Turnover

People who feel valued and respected are less likely to leave the company they work for. Companies need to encourage a winning company culture that upholds their values and mission statement.

It Attracts Talent

Job candidates evaluate workplace cultures when they are looking for places to work. A strong, well-defined, and great company culture attracts the right candidates to your open positions.

How Workplace Culture Affects Employee Morale and Productivity

Employee morale increases or decreases depending on a company’s workplace culture. When culture is unclear or irrelevant, problems and stress increase for employees – causing company results to suffer. 

When people feel good about what they do, they are more likely to have high morale. Employees want to belong to something bigger than themselves, and a positive company culture can accomplish this.

For instance, businesses that recognize their employees and establish company traditions are more likely to have employees with a higher level of morale.

Too many companies think that having a high-pressure, cut-throat culture is the best way to drive financial success. But the truth is workplaces with toxic cultures are detrimental to productivity over time. A stressful environment results in lost engagement and a decrease in  employee productivity.

Healthcare expenditures even go up by 50 percent at high-pressure organizations compared to organizations that foster a healthy workplace environment.

10 Ways to Boost Employee Morale and Job Satisfaction

The way you lead and manage your employees has a large impact on their morale and satisfaction. Here are 10 ways to boost employee morale and job satisfaction.

Lead by Example

The way employees are managed has a huge effect on their morale. Workers want to feel trusted and understood by their leaders. Lead by example by implementing rules, regulations, and expectations that you also follow.

For instance, if you expect your employees to be positive, then come into your office each day with a positive attitude. Your employees are likely to follow suit.

Communicate Often

Effective employee communication is key to building a successful culture.

Whether in person or virtual, communicate with your employees often. This might mean weekly company-wide meetings or looping them into important emails. Don’t forget to share company successes with them, such as a new product in development or an excellent customer review.

Regular communication builds camaraderie and trust between your employees and your organization. A company culture that fosters communication also knows the importance of transparency.

Be Transparent

Don’t try to hide your organization’s problems such as drops in revenue or major organizational changes. Hiding information may create gossip that can end up being misconstrued as it travels around the workplace. 

Share relevant information with your employees in morning meetings or call for special team lunches. During these meetings, ask for employee feedback and suggestions so they can be a part of the solution and know what they need to do to contribute to your company’s success.

Provide Regular Employee Recognition

Focus on the good and let your employees know what they did right. Employees that feel truly appreciated become more confident, engaged, and productive. 

Employee recognition is an easy way to improve employee morale and it helps your employees to see that their work contributes to the overall success of the organization.

Ask Employees for Feedback

No workplace is perfect. Try as you might, you’ll need help getting workplace culture right to maintain employee morale.

The best way to do this is to gather feedback from employees in all positions on what can be done better to improve their work environment and productivity. 

Run a Calm and Organized Company

Pushing yourself and your team to perform is helpful at times, but your goal should be to keep things calm.

A company that runs smoothly and handles setbacks with ease is more likely to bounce back quickly from the setback than companies that create panic and stress for their employees. 

Organize Fun Team-Building Activities

Your employees might spend more time with the people they work with than they do with their own families. Don’t make it all about work all the time. Instead, take time to organize an activity that allows your employees to relax and get to know each other while doing something fun.

Whether it’s monthly, quarterly, or yearly, interactive team-building activities help improve employee morale and get creative juices flowing, while also encouraging employee bonding.

Encourage Mental and Physical Wellbeing

Balancing life and work is stressful. Make sure your employees know that you care about their mental and physical wellbeing. A great way to do this is by offering a wellness program as a part of their benefits package. 

Successful wellness programs include gym memberships, classes, meditation, and activities to help employees de-stress and support their mental and physical health.

Provide Employees With Incentives

Incentives aren’t always monetary. Dish out employee incentives as rewards for hard projects or good work.

Some incentives that employees will appreciate include paying for classes that tie to their professional abilities, bringing in puppies or kittens from a shelter, letting employees go home early, or providing helpful books to further develop or learn new skills.

Offer Growth and Education Classes

Employee morale can dwindle quickly when employees believe they can no longer grow in their positions. Give them a sense of purpose and a goal to work toward so they have something to look forward to. 

For instance, you can send them to a conference or sign them up for an exclusive course that helps them hone in on their skills. 

When you couple workplace culture with improving your employee’s lives, you’ll see a steady increase in productivity and company morale. Put our tips to practice to create the culture you and your employees will love.


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Wellhub Editorial Team

The Wellhub Editorial Team empowers HR leaders to support worker wellbeing. Our original research, trend analyses, and helpful how-tos provide the tools they need to improve workforce wellness in today's fast-shifting professional landscape.


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