Corporate Meets Culture-Beyond Employer-Branding

When you look at successful international corporations there are several different reasons why they perform better and develop faster than competitors. Yet, one key element to strong and healthy corporations remains common: employees that are eager and proud to be part of the company. Even in days of difficulties, employees will still feel loyal and commited to it. But how can corporations create such link, how can a company keep its best employees, develop them and at the same time, develop with them? To answer these questions the topic needs to be looked at from different angles.

Looking at the fast globalizing world and emerging markets like the BRIC countries, young talented professionals are no longer limited to the home labor market. Language skills and increasing cultural awareness are drivers for many young people to go abroad and experience different cultures in both a professional and private environments. Until recently most of these mobility streams were based on expatriate contracts with a determined mission period abroad and a return to the home market thereafter. Today skilled professionals are no longer dependent on a company to provide them with an expatriate contract and a mobility package. They tend to mobilize themselves directly to the local markets abroad and apply for the most interesting jobs worldwide.

As a consequence the potential of talented young professionals is no longer equal to the number of graduates from schools in a home market. The search for highly educated people is becoming a worldwide challenge, as the scarcity has been accelerated through the economic rise of emerging countries and through the demographic imbalance in highly industrialized countries. Therefore, attracting highly qualified human resources has become more than ever a strategic goal for corporations.

In order to get access to the brightest young people, corporations spend a lot of money and efforts to attract students already before they have taken a decision on where they want to work in their future. In a situation of competition to find young talents, corporations not only use their branding and the outlook of career opportunities, but they tend to promote their unique corporate culture: they pay high attention to create an image of looking young, dynamic and permanently at the forefront of innovation. They tend also to act as environmentally conscious and socially responsible, because their footprint is not only in the global economy, but also in the global world.

Today a graduate from a top-ranked engineering school in Europe will experience little difficulties to get access to the best entry positions and will have good chances to earn a high salary. The criteria for this student to select between different companies and positions can be divided in quantitative and qualitative criteria.
Quantitative criteria include fixed and variable salary, additional remuneration packages, such as social security, stock options, retirement plan, employee participation, company car, mobility packages, as well as the number of working hours, number of holidays and income tax. Based on these elements a potential employee will be able to calculate the disposable income, which will result in a certain living standard and material wealth.
Qualitative criteria include career opportunities, affinity for the industry and the product of the company, internationality and mobility opportunities, training and development, prestige and reputation of the position and of the industry, social care, geographic location, corporate culture, philosophy and ethics.
The way an individual will rank and weight these criteria is subject to personal factors such as family, affinity to a location or region, importance of status, income and career.
In a situation where the labor market for skilled and highly educated people is becoming scarce and salaries are high through market dynamics, it is clear that an individual will put higher emphasis on qualitative criteria.

Why is corporate culture becoming increasingly important in the choice of an employee?
“Culture is the collective programming of the human mind that distinguishes the members of one human group from those of another. Culture in this sense is a system of collectively held values.” -- Geert Hofstede
“Culture is the deeper level of basic assumptions and beliefs that are shared by members of an organization, that operate unconsciously and define in a basic ‘taken for granted’ fashion an organization's view of its self and its environment.” -- Edgar Schein
According to Geert Hofstede and Edgar Schein, culture is therefore a link between individuals that keep them together as a homogeneous group. This explains why corporate culture is important when it comes to employment and loyalty between an employer and an employee. The better a corporation succeeds to create a strong culture that stands for its own values, and provided that the employee identifies with these values, the result will be a tight and sustainable link between the corporation and its employee.

Looking at annual reports of multinational companies one will easily detect that many of them claim to have a corporate culture and promote corporate social responsibility as well as environmental care.
Unless an individual employee really believes in these values because he can experience them in day-to-day business life, the corporate culture really exists and is valid as being part of the organisation. Companies like Toyota who have clearly defined a set of values for its company, called “The Toyota Way” (Toyota Annual Report 2007), have not only created a very strong branding towards their customers, their shareholders and the public but reflect their values as well to the inside of the organisation. A solid corporate culture that employees can identify with, ultimately leads to loyalty towards the employer.
Corporate culture can be influenced by national behaviors and patterns. For example, siestas are a must in Spain and the months of August is devoted to holidays in France (MIT Sloan, winter 2001, vol.42); German unions are extremely powerful and therefore take a say in a lot of company decisions when it comes to human resources. Of course this would bring difficulties for a truly global corporation wanting to create a corporate culture that suits all its employees with different national backgrounds.
Corporate culture is also tightly linked to the industry. Start-ups have developed intentionally a completely different culture than multinational companies in traditional sectors. In the same way, fashion companies have built up a culture of creativity, exclusivity and sense for trends.
Corporate culture can not ignore corporate social responsibility such as taking into consideration parental leave beyond legal minimum requirements, providing sport and fitness facilities, allowing flexible working times for parents, providing a company kindergarten, providing a library and social areas for colleagues to meet and discuss, providing free or subsidized meal at a company cantina.

When a company succeeds in promoting a strong corporate culture, it has not only a higher potential of attraction for young talents, but also the ability to ensure the employee’s loyalty and satisfaction in the long run. Although the value of corporate culture for a company is difficult to quantify, it has become of utmost importance since both young talents and highly qualified professionals now make their choice of employer dependant on it. Yet, it is not sufficient that companies put up fashionable values in their annual reports to please their shareholders and to disclose them on their website to create a favorable public opinion. Company values need to be lived in an exemplary way by top management, and employees need to recognize a very personal link between these values and their proper convictions. A lot of corporations tend to neglect corporate values when they find themselves under pressure to cut cost and lay off workforce. But it is at this very crucial moment that a company needs a strong corporate culture the most in order to retain its best employees. A long-term vision and keeping up values of an established corporate culture are definitely key for the corporation success over time.