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How to Build a Culture of Ownership

Writer's picture: Jonathan H. Westover, PhDJonathan H. Westover, PhD

Updated: 1 day ago

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Abstract: The article explores how leadership can foster a strong organizational culture where employees feel a true sense of ownership and investment in the company's vision and success. It defines an "ownership culture" as one where all individuals feel personally accountable and act with an entrepreneurial mindset. Research shows organizations with high employee ownership have greater productivity, profitability, stability, and long-term viability. The article outlines key strategies for cultivating this culture, including involving employees in decision-making, implementing compensation structures that reward shared success, communicating an inspiring collective purpose, providing development opportunities, and demonstrating ownership through leadership actions. Ultimately, the article argues that building a culture of employee ownership is crucial for long-term organizational success and sustainability, and provides a roadmap for how companies can work towards this goal.

Building a strong organizational culture where employees truly feel a sense of ownership is crucial for the long-term success and sustainability of any company. However, cultivating this type of environment can be challenging.


Today we will explore how leadership can foster a culture where all employees feel invested in the company's vision and are motivated to act like owners. If implemented effectively, these approaches can help transform an organization's culture and boost performance.


Defining Ownership Culture and Its Benefits

Before delving into how to establish ownership amongst employees, it is important to first define what is meant by an "ownership culture." In essence, an ownership culture is one where all individuals within an organization feel personally accountable and invested in the company's overall success (Schein, 2010). Employees act with an entrepreneurial mindset and make decisions as if they were the owners of the business.


There are significant advantages to nurturing this type of culture. Research shows that organizations with high employee ownership have significantly higher levels of productivity, profitability, stability and long-term viability compared to average companies (Blasi, Kruse, & Bernstein, 2013). When employees feel invested as owners, they are more engaged, motivated to go above and beyond, and less likely to leave the organization. This results in lower turnover costs and increased organizational commitment. Employees also tend to be more invested in decision making and problem solving when they have strong feelings of ownership over outcomes (Wagner, Rabkin, & Newman, 2018).


Involving Employees in Decision Making

One of the most effective ways for leadership to cultivate an ownership mentality is by involving employees in strategic decision making processes. Some specific techniques include:


  • Establish employee councils. Companies like Ford and Merck have created formal ownership councils where staff representatives provide input on key corporate issues like compensation, benefits and organizational changes (Rosen, Case, & Staubus, 2005). This gives employees a voice and sense of control.

  • Promote open-door policies. Leadership should make themselves accessible to all employees and genuinely listen to new ideas or concerns. 3M is famous for its open-door approach that has led to many profitable innovations (Rosen, Case, & Staubus, 2005).

  • Use suggestion programs. Formal initiatives that reward innovative staff proposals, like at BASF, empower employees and signal their opinions are valued (Wagner, Rabkin, & Newman, 2018).

  • Conduct regular surveys. Gathering anonymous feedback on engagement, culture and strategies via surveys gives employees a platform to be heard and demonstrate leadership is responsive. Dell conducts frequent pulse surveys to incorporate worker perspectives.


Involving employees in strategic and operational decision making fosters transparency, builds trust in leadership and gives staff a sense of influence—all key factors in cultivating an ownership mindset.


Compensation that Rewards Shared Success

How companies compensate their employees also plays a major role in shaping cultural perspectives. To foster greater ownership, organizations should consider compensation structures that directly tie pay to company-wide success:


  • Profit sharing. Many employee-owned companies like Publix distribute a portion of annual profits directly to all staff, helping them feel invested in maximizing revenues and efficiency. Profit sharing programs can boost employee motivation and retention substantially (Park & Kruse, 2016).

  • Gainsharing. Some firms implement gainsharing programs that reward teams for attaining productivity, quality or cost-cutting goals. This incentivizes collaborative behaviors and a shared focus on continuous improvement efforts (Rosen, Case, & Staubus, 2005).

  • Stock ownership plans. Providing stock or stock options allows employees to build wealth alongside the company's growth. This long-term stake fosters an ownership mentality and stronger ties between individual and organizational interests (Blasi, Kruse, & Bernstein, 2013). Starbucks popular Employee Stock Purchase Program exemplifies this approach.


Compensation practices that share the rewards of business success more broadly help employees perceive themselves as part-owners invested in maximizing value for all stakeholders.


Communication that Inspires Collective Purpose

For employees to embrace an ownership mindset, leadership must communicate an inspiring organizational purpose and vision that people want to advance together. Specifically, effective communication strategies include:


  • Articulate core values and purpose. Clearly define the company's mission in terms of benefiting customers, society or the world. Clearly defining higher purpose prevents employees from viewing their jobs narrowly.

  • Tell success stories. Share examples of how employees across divisions collaborated to solve problems or achieve milestones. This inspires pride in collective accomplishments.

  • Highlight challenges openly. Discussing obstacles candidly engenders trust while rallying the organization to overcome issues through shared effort.

  • Recognize employee contributions. Visibly showcasing individual and team achievements that advance the company vision fosters pride in ownership of the business's trajectory (Schein, 2010).

  • Promote from within. Demonstrating advancement opportunities energizes employees to take greater initiative and ownership over their careers within the organization.


When leadership inspires employees to identify with an aspirational company mission and feel pride in joint successes, people naturally embrace a sense of shared ownership over organizational outcomes.


Providing Development Opportunities

Part of cultivating ownership involves giving all employees opportunities to expand their skills, take on new responsibilities, and advance professionally within the organization when possible. Development practices that encourage ownership include:


  • Supporting continuous learning. Offering tuition reimbursement, internal/external training programs, and mentoring helps employees gain qualifications to expand their ownership of different roles over time.

  • Rotational assignments. Giving staff temporary opportunities to work across business units fosters broader organizational perspectives and networks while developing new capabilities central to the company's future success.

  • Internal mobility programs. Making internal hires and promotions the priority over external candidates whenever feasible demonstrates the company invests in developing talent from within and rewards employee ownership over career progression.

  • Succession planning. Visibly grooming high-potential employees for leadership roles signals the organization trusts and relies on developing leadership from internal talent who understand its unique culture.


When professional growth is actively supported, employees feel invested in applying themselves fully to advance the company's long-term priorities through expanding the responsibilities they own within it.


Demonstrating Ownership Through Action

An organization's culture is shaped significantly by visible actions leadership models on a daily basis. Three effective practices to demonstrate personal ownership include:


  • Solving critical problems proactively. Stepping in personally to resolve issues that derail strategic priorities displays willingness to fully own major responsibilities. This inspires similar commitment in others.

  • Living values unapologetically. Acting with integrity, collaborating cross-functionally, and driving continuous improvement through personal effort shows ownership over building the desired culture.

  • Embracing feedback fearlessly. Openly soliciting and addressing criticisms without defensiveness signifies one's accountability to key stakeholders and willingness to evolve ownership based on lived experiences.


When leadership displays sincere dedication to owning the company's challenges and actively shaping its destiny through determined action, others naturally emulate this behavior and embrace ownership as a core cultural norm.


Conclusion

Building a culture where all employees genuinely feel invested like true owners demands consistent effort over the long run. However, the competitive advantages that stem from high employee ownership, in terms of motivation, productivity, innovation and retention, make this work well worth it. Leadership plays a critical role in cultivating ownership through strategic involvement of staff, compensation tied to collective success, inspiring communication, development support, and modeling the right behaviors. While building this type of culture involves changes that may seem daunting, even small steps in these areas can start shifting mindsets. With persistence and commitment from the top, any organization can develop the ownership mentality essential for thriving in today's fast-paced environment.


References

  • Blasi, J., Kruse, D., & Bernstein, A. (2013). The benefits of employee ownership. In D. Kruse (Ed.), Sharing ownership, profits, and decision-making in the 21st century (pp. 53–70). Emerald Group Publishing Limited. https://doi.org/10.1108/S0277-283320130000005004

  • Park, R., & Kruse, D. (2016). Does employee ownership increase firm value? Employee stock ownership plans (ESOPs) and firm performance. SSRN Electronic Journal. https://doi.org/10.2139/ssrn.2831707

  • Rosen, C., Case, J., & Staubus, M. (2005). Equity: Why employee ownership is good for business. Harvard Business Review Press.

  • Schein, E. H. (2010). Organizational culture and leadership (Vol. 2). John Wiley & Sons.

  • Wagner, K., Rabkin, D., & Newman, A. (2018). The sharing solution: How to save money, simplify your life & build community. BenBella Books, Inc.


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  • Luthans, F., & Peterson, S. J. (2002). Employee engagement and manager self-efficacy. Journal of Management Development, 21(5), 376–387. https://doi.org/10.1108/02621710210426862

  • Maslach, C., Schaufeli, W. B., & Leiter, M. P. (2001). Job burnout. Annual Review of Psychology, 52(1), 397–422. https://doi.org/10.1146/annurev.psych.52.1.397

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  • Crum, A., & Sherman, D. K. (2008). How mind-sets matter. In J. Y. Shah & W. L. Gardner (Eds.), Handbook of motivation science (pp. 204–221). The Guilford Press.


Additional Reading

  • Westover, J. H. (2024). Optimizing Organizations: Reinvention through People, Adapted Mindsets, and the Dynamics of Change. HCI Academic Press. doi.org/10.70175/hclpress.2024.3

  • Westover, J. H. (2024). Reinventing Leadership: People-Centered Strategies for Empowering Organizational Change. HCI Academic Press. doi.org/10.70175/hclpress.2024.4

  • Westover, J. H. (2024). Cultivating Engagement: Mastering Inclusive Leadership, Culture Change, and Data-Informed Decision Making. HCI Academic Press. doi.org/10.70175/hclpress.2024.5

  • Westover, J. H. (2024). Energizing Innovation: Inspiring Peak Performance through Talent, Culture, and Growth. HCI Academic Press. doi.org/10.70175/hclpress.2024.6

  • Westover, J. H. (2024). Championing Performance: Aligning Organizational and Employee Trust, Purpose, and Well-Being. HCI Academic Press. doi.org/10.70175/hclpress.2024.7

  • Citation: Westover, J. H. (2024). Workforce Evolution: Strategies for Adapting to Changing Human Capital Needs. HCI Academic Press. doi.org/10.70175/hclpress.2024.8

  • Westover, J. H. (2024). Navigating Change: Keys to Organizational Agility, Innovation, and Impact. HCI Academic Press. doi.org/10.70175/hclpress.2024.11

  • Westover, J. H. (2024). Inspiring Purpose: Leading People and Unlocking Human Capacity in the Workplace. HCI Academic Press. doi.org/10.70175/hclpress.2024.12

 

Jonathan H. Westover, PhD is Chief Academic & Learning Officer (HCI Academy); Chair/Professor, Organizational Leadership (UVU); OD Consultant (Human Capital Innovations). Read Jonathan Westover's executive profile here.

 

Suggested Citation: Westover, J. H. (2025). How to Build a Culture of Ownership. Human Capital Leadership Review, 17(1). doi.org/10.70175/hclreview.2020.17.1.4


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