As Peter Drucker famously observed, “Culture eats strategy for breakfast.” An organization may develop an airtight strategy on paper, one that is consistent with what the company says it values and with the initiatives everyone agrees are most important. But when it comes down to it, strategy is lived and breathed through culture.

Chief strategy officers (CSOs), tasked with designing and driving organizational strategy, recognize culture’s importance. A strategy cannot move forward unless it is aligned with the behaviors and values of the people required to stir it into action. Among CSOs, this is well understood. Yet a critical (and consistent) question that comes up for many of our CSO members in Outthinker Networks is how to measure organizational culture.

The Difficulty of Measuring Company Culture

Culture is often placed on the right-brain side of the touchy-feely, emotional, and immeasurable. It’s difficult to define and more difficult to measure. Especially in highly decentralized organizations, placing hard measurements and observations around culture can be seen to restrict it. By watching culture too closely, we may inadvertently alter it. On the other hand, measuring culture can be essential to tracking organizational transformation. Companies need more than qualitative feedback to show how initiatives around culture are progressing.

To provide some guidance around how to measure company culture, we met with four strategy leaders – members of Outthinker Networks who have been a part of significant cultural transformation efforts throughout their strategy careers. Backed by their combined decades of experience, successes, failures, and lessons learned, they shared five ways to measure organizational culture.

Five Methods to Measure Culture, Recommended by Chief Strategy Officers

1. Employee Engagement Rate
One member, the CSO of an airline holding group, uses surveys to measure employee engagement rates to determine the progress of a recent cultural transformation. For field employees who do not use computers or email throughout the day, other members sent surveys through WhatsApp or traditional paper.

“Instead of trying to convert them, we went back to paper and pencil and direct face-to-face. That was easier than getting them to do something that was counter to their job and what fulfilled them,” the CSO of a New York City non-profit said.

Members cautioned that having to fill out too many surveys can dampen morale, so use this method sparingly.

2. Employee NPS Score 
Most companies are familiar with uncovering Net Promoter Score (NPS) to determine customer satisfaction. Our strategy leaders also advised using employee net promoter score (eNPS) to measure employees’ likelihood to recommend their company as a good place to work. ENPS can capture a cultural snapshot and is best used in combination with other measurements.

3. Staff Turnover Rates 
One CSO, the former SVP of Transformation & Growth for Cancer Treatment Centers of America (CTCA), suggested keeping it simple.

“I was part of a major culture transformation at CTCA with 6,000 employees in six markets around the country. We elected three things to focus on: profitability, NPS, and staff turnover,” he shared.

When the environment is positive, most people want to stay with the company longer. Low staff turnover rates can be an indicator of a healthy culture. High staff turnover rates, adjusted for other external factors, may be a symptom of underlying cultural issues.

4. Job Vacancy Rates
One CSO recommended looking at job vacancy rates as a culture measurement: “When things are good, you’ll have a lot of people wanting to work there.”

Word of mouth and Glassdoor reviews offer candid insights into company culture. These can be excellent sources of feedback on areas to highlight or improve.

5. Exit Interviews 
When measuring culture, it’s important to blend quantitative with qualitative feedback to get a full picture of the current environment. For that reason, we’ve chosen to include a qualitative measure in this list: employee exit interviews. Employees may be in their most honest state when they leave the company. The CSO of an HR solutions company recommended investing time and money into good exit interviews to find out why people are leaving and anything they did not enjoy about the organization.

Final Thoughts

Measuring organizational culture is a complex topic, but it is a critical exercise for strategy leaders looking to drive transformation. This list – tested and compiled by experienced heads of strategy from multi-billion-dollar organizations – offers a few tools to get started. By selecting a few key metrics and consistently tracking them over time, strategy leaders can gain valuable insights into whether their culture initiatives are taking hold or if adjustments are needed.