Great cultures don’t happen by accident: 3 signs yours is broken and how to fix it
How to make culture your competitive advantage in 2021.
Of the awards we’ve earned over the years, Eric and I are most proud of the awards we’ve won as leaders of a company with a standout culture. These accolades are particularly special because we earned them because of feedback our employees have given about the quality of their experience at work.
Culture wasn’t a given--that is, it didn’t happen on its own. Like many growing companies, ours had not always made it a priority or considered its importance in our success. But having real conversations about who we were and who we wanted to be and identifying the parts of our work environment that weren’t working helped to set the stage for our cultural transformation.
The role of culture
Employee perception of their work environment has become an increasingly hot topic in the past decade, with a recent Jobvite reporting that 88% of employees rate culture as relatively important and 46% rate as very important. Similarly, 15% of employees report having turned down a job offer because of company culture. With the significance placed on this aspect of work, it’s easy to see how having a less than stellar culture can stunt an organization’s ability to generate innovative ideas and compete for the talent they need to achieve their goals.
How to tell if your culture is broken
Many of the issues frequently cited as business challenges are culture issues at their core. In our own company, we have had to deal with the negative effects of many of these at some point early on in the transformation process. If your organization is experiencing some or all of these problems, it may be time to address your culture.
Talent issues
Inability to attract and retain top talent is a key indicator of a culture in need of improvement, and one that comes at a significant financial cost. According to a recent SHRM study, nearly 1 in 5 people have left their jobs in the past 5 years due to culture, and the cost of that culture-related turnover in the past 5 years alone is $223 billion.
More than the replacement costs alone, there may be additional unintended consequences that make future hiring more challenging, such as newly-separated former employees going public with their grievances, narrowing your applicant pool by using their keyboards to encourage other job seekers to steer clear. According to a 2018 Jobvite report, 22% of employees have ruled out working for an employer because of what they read on review sites like Glassdoor.
Doing an audit of what percentage of employees your company has turned over in the last year compared to your industry’s average and taking a look at any reviews on your Glassdoor page can give you insight as to whether your work environment may be hindering your hiring and retention efforts.
Leadership problems
While good leadership is often easy to spot, poor leadership may be less apparent but quickly damages culture. Bad leadership also has an overwhelming correlation with poor retention, with 6 in 10 employees who have left a job in the past 5 years citing their direct manager as the top reason for their departure.
Taking a look at the behaviors of your company’s leaders, from first line managers to executives, may highlight issues with your work environment. Frontline employees will look to the leaders to model behavior and emulate both the good and the bad, and they will be quick to notice when the leaders’ actions don’t mesh with the company’s stated values. When the incompatible behaviors go unchecked, it undermines employee trust in the organization and engagement.
Lack of psychological safety
Having an environment where employees feel comfortable asking questions, taking reasonable risks, and sharing feedback with the organization is critical to innovation and sustainable growth. While teams where employees fear blame, retaliation, or judgment are often limited to incremental improvements on existing ideas, those on teams where psychological safety is valued are 12% more productive, 27% less likely to turnover, and twice as likely to be rated as effective by a company’s top leaders.
But the absence of psychological safety is not always obvious, and the signs can be easy to miss. A lack of questions at team meetings, lack of sharing personal stories or details, cautious ideas, and the tendency to assign blame when something goes wrong can all be signs that employees feel less than comfortable in your work environment.
Levelling up your culture
So you’ve identified some issues with your culture that are holding you back. Once you’ve committed to improving, there are a few key areas you can address to make a measurable difference.
Build a strong foundation
A strong company vision, mission or purpose, and core values are central to a compelling culture. These elements tell your team what’s important to the organization and when internalized across the company will guide future decision making at all levels.
Your vision, mission, and values don’t have to be complex as long as they resonate with your team and represent what is unique about your organization. Engaging your employees about what the qualities are of people who are successful across your organization can provide great context that can help shape your values.
Let your team lead
While it is the responsibility of company leaders to maintain a positive work environment by supporting decisions and initiatives that reinforce the company’s values, employees at all levels who buy into the process are critical for leading the day-to-day execution of leading culture.
Taking a backseat and allowing employees to spearhead initiatives while providing executive sponsorship will not only support a positive work environment but can provide practice and mentorship for team members seeking meaningful growth opportunities.
Final thoughts
Having a strong work culture has become increasingly important for company growth. From productivity and innovation to hiring and retention, becoming intentional about creating a positive work environment is a critical component of meeting your organizational goals.
