Team Culture vs. Company Culture: Does team culture matter more to a company than company culture itself? 

Team Culture vs Company Culture

Lucy Kellaway of the Financial Times surveyed the execs of 24 companies and found only 5 could recognize their own company values. Of those 5, 3 of them had actually written their company values themselves.

From memory, do you know what your company values are?

While “Company Culture” gets a lot of lip services and is indeed important to always keep in mind, In practice, Company Culture rarely trickles down to the day-to-day working lives of your employees.

Let’s look at how Company Culture compares to the individual Team Cultures at companies and which aspect you should focus on.

Defining Cultures

Before diving into the argument, let’s clarify what we mean by “Company Culture” and “Team Culture.”

  • Company Culture is the established set of values, assumptions, and beliefs that inform decision-making, leadership styles, and ethical considerations across the entire organization.
  • Team Culture, on the other hand, is the set of practices, values, and norms that are shared within a smaller group of people working together within the organization.

Both types of culture exist within any given company, but which one has a greater impact on day-to-day work? The truth is, individual micro-cultures within teams often exert a more immediate influence on employees than overarching company culture.

The Power and Importance of Team Culture

If you, as an employee, get stuck in a toxic team, you are much more quick to leave regardless of how positive a company culture is. On the positive side, research shows that if you are on up to five different teams, you are likely to be among the most engaged employees in any company.

The unfortunate consequence of companies pouring investment into business culture instead of offering extra support and care to teams is that they miss the impact of leadership and micro-cultures. In the words of Joost Minnaar of the Corporate Rebels “Team Culture eats Company Culture for Breakfast”.

Example: Two-Pizza Teams

For example, Amazon’s “Two-Pizza Teams” is a management philosophy introduced by founder Jeff Bezos to encourage decentralization and innovation within the company. The principle is that any internal team should be small enough that it can be fed by two pizzas. This keeps groups agile, self-sufficient, and prevents the bottlenecks and bureaucracy that can arise in larger teams. By maintaining small, autonomous units, Amazon aims to foster a culture where each team acts like an independent small company, focused on delivering value and innovation. 

Benefits of Focussing on Team Culture

Company culture and values are highly unlikely to be abandoned any time soon but shifting the focus allows for significant improvement in employee and managerial experience and contributions. 

By switching to focus on teams, you reverse the dynamic of cultural integration. Employees are no longer mandated to perform to company slogans, expected norms and values and are, instead, trusted with creating their own mutually accepted belief systems.

  1. Employees Feel Valued

The criticisms of company culture platitudes being unrelatable for employees is no longer the case when attention is turned to team culture. When a company allows the team to develop their own internal norms rather than subscribing to outdated values, they feel valued, respected and trusted. Trust is crucial to improve collaboration, alignment, efficiency, engagement and productivity to name but a few. With the increase in remote work, this is growing in importance, especially for employees below the C-Level where trust in the organization has dropped to below 50%

Further to trust, a sense of belonging and personal value is endowed within the team. By focussing on team engagement and culture, each employee understands that they have a vital and respected part to play. The inverse is that the team also appreciates the unique addition each member is and holds them in much higher regard.

  1. Empowering Team Leaders

Focussing on team culture greatly increases the power of team leadership and management to impact engagement. Leaders are involved and familiar with individual teams and their members and know what they need or can at least inquire. The changes, perks or benefits offered are personalized to the individual team in pursuits of their optimization. 

Team leaders remain in control of metrics that make a difference. They are afforded the opportunity to set out expectations that get the most out of the individuals, benefit the team members’ career aspirations and living situations whilst also servicing overarching company aims. 

  1. Project Aristotle

One of the loudest champions of a positive company culture is Google. Duvet days, games rooms, sleeping pods and many other perks exist within their culture strategy. However, equal amounts of attention is quietly paid to the impact of team culture. That is why, in 2012, they commissioned Project Aristotle, a 5 year study into the biggest factors affecting teams and how they could hack high performance. 

What resulted was the discovery that teams were most affected by how they worked together and how psychologically safe each member felt. Psychological safety refers to feeling respected and valued among your peers and that any contribution you make is free from social risks and embarrassment. 

What is interesting to note is that the effectiveness of employees at one of the biggest companies on the planet is predicated upon feeling socially safe to contribute within their team; more so than being given free food, free gym access, massage therapy or even the death benefit (payment of 50% of salary to a deceased Google employee to their spouse for 10 years). 

Blending Culture and Team Focus

Human resource management is a complex game, especially when it comes to company culture. 

Beyond the fashion-forward focus of company culture, a more nuanced, team-based approach is most effective for achieving genuine employee engagement and bottom-line results. Teams are looking for a sense of belonging, attention and alignment with their career goals rather than a dictated set of values.

Of course, overall, a company must be a positive, diverse and inclusive place to work and have ideals to which employees intentionally subscribe to. However, the decisions on what matters culturally is more effectively left in the hands of individual teams. By creating a positive infrastructure, physically and financially, and equipping leadership, a business can enhance team culture and performance, surpassing the limitations of company culture. 

In the long term, your current crop of employees are most responsible for delivering results and empowering them to foster their own culture enhances their ability and willingness to perform. That is why focusing on team culture outperforms company culture every day of the week.