In my decades of work with hundreds of companies both large and small, I’ve discovered that few things are as important — and sometimes as difficult to grasp — as an organization’s culture.

Prospective employees want to know what the culture is to better be able to determine whether they will “fit in.” Managers want to understand the company’s values and how they impact their teams. Customers want to know what to expect when they interact with employees. We all want to know where we came from, who we are and where we are going.

So, what is culture? Not surprisingly, there are many different organizational culture definitions. Some people define company culture in terms of its essential features, such as being “innovative,” “performance-based” or “traditional.” It acts as an invisible hand that guides and shapes an organization.

We know there are endless company culture definitions, but according to a recent Gallup Organization report, culture simply comes down to “how we do things around here.”

The report goes on to define the importance of and benefits of a strong, broadly shared organizational culture, and how it sets the tone for alignment across the board, but nowhere to be found were the words “appreciation” and “recognition.”

I submit that at its core, appreciation and recognition shapes the entire culture of an organization. When appreciation is woven into the fabric of the workplace, it creates a positive and supportive environment where employees feel motivated to perform at their best.

Moreover, a culture of appreciation fosters trust, loyalty, and camaraderie among team members, driving collaboration and innovation. It reinforces organizational values and reinforces desired behaviors, leading to higher levels of employee engagement and satisfaction.

Recognition has a profound impact on employee well-being. Feeling appreciated and valued boosts self-esteem and confidence, leading to increased job satisfaction and reduced stress levels.

Employees who receive regular recognition are more likely to feel a sense of belonging and fulfillment in their roles, leading to higher levels of job motivation and performance – attitudes that can drive culture.

At the same time recognition can enhance overall mental health and resilience, contributing to a healthier and more engaged workforce.

Creating a culture of appreciation and recognition is not a one-size-fits-all endeavor. It requires a thoughtful and tailored approach, beginning with aligning recognition efforts with the organization’s mission, vision, and values. Leaders play a pivotal role in setting the tone by consistently demonstrating appreciation for their teams’ contributions.

After recognition efforts achieve liftoff, organizations must demonstrate ongoing commitment and effort to sustain its hard-won culture. That means continually refining recognition initiatives to meet evolving employee needs and preferences.

Regular feedback and open communication channels can provide insights into what forms of recognition resonate most with a diverse and unique workforce, and help with staying committed to continuous improvement.

So, while a company’s culture may be based on a number of key factors, it is critical we also stress the role recognition and employee well-being plays in developing and maintaining that culture.