5 min read | 26 February, 2019 By Sarah Benstead
Company culture is one of those things that’s quite hard to define because it’s not tangible in the same way sales figures or staff numbers are. Instead, it is the set of beliefs, values and behaviours that define how your employees work together to produce your products or services.
A study by Warwick University discovered happy workers are 12% more productive than their unhappy counterparts, so if you have a poor culture, you can expect lower returns all round.
Stats aside, if you’ve ever worked in a business with a toxic culture, you’ll understand how damaging it can be, leading to low morale, malicious gossip and a mentally draining atmosphere in which staff are disengaged, disillusioned and fundamentally unproductive.
By contrast, a positive company culture can encourage a collaborative and healthy environment, build loyalty, increase productivity and ultimately turnover.
According to Greg Besner, founder of Culture IQ, company culture is sometimes seen as a soft metric and therefore difficult to assess. But it’s important you do continually monitor it because a poor culture will negatively affect your bottom line.
People spend a good portion of their lives at work and naturally want to work in an environment that is safe, inspiring and gets you out of bed in the morning.
If the culture is substandard, you'll know about it. Big talent will vote with their feet - you can kiss goodbye to employee loyalty and say hello to poor staff retention and difficulty in recruiting new talent.
If you’re constantly having to recruit new staff, the recruitment and onboarding costs can be immense, not to mention the loss of productivity as you get new staff up to speed. And don’t think you can get away with it because it’s simply an internal problem – people talk.
Before you know it, your business will gain a reputation as a poor employer and you’ll struggle to attract staff (and maybe business) at all.
That's why monitoring your company culture development is a big must.
Measuring employee engagement and satisfaction is important for maintaining a healthy culture.
Immediately gauge your culture through an employee wellbeing or engagement survey. If you know - or suspect - your culture is a bit lacking, then doing this anonymously is the best way forward. Be prepared to get some unpalatable answers if things aren’t great, but once you have that data in black and white you or your management team can actively take steps to improve the situation.
Surveys are great:
Employee praise and reward is a critical part of creating a positive company culture.
And it doesn’t have to break the bank either. At one end of the scale, a simple, metaphorical pat on the back for a job well done will suffice but, don't forget, you can also introduce a defined system of incentives that really appeal to the personal needs of your staff. For example, if you know someone loves the theatre, why not get them a couple of tickets to the latest show?
Research by the Retail Gift Card Association revealed that 60% of employees have at one time received a gift card as a reward or incentive and 91% of them liked it.
A culture assessment is not dissimilar to a survey but instead it focuses very much on your company culture instead and the questions are fundamentally different. According to Sheila Margolis, a consultant specialising in organisational culture, you’ll be asking things like: What is the purpose of our business? How are we different from our competitors? Why is the work we do important?
Cohesive and similar answers can indicate a healthy culture where staff understand your business and are working towards a shared common vision. Your employees identify with your core values - whatever they may be - and consistently put them into practice. On the flipside, assessments that show a lot of different answers point to an undefined culture; there is little to no sense of shared purpose and staff may pull in opposite directions, which can affect productivity.
How you measure productivity depends on the type of business you run. If you’re in manufacturing, for example, productivity might be measured on the basis of how many units you produce in a given period of time and the cost per unit. For services, it might be based on number of clients, values of contract and the cost of acquisition or regular feedback from staff which you can track using HR software. The metrics may change but the fundamental aspect of measuring your company’s health is the same.
If you see a rise or fall in productivity, you’ll be able to spot an issue. It may of course have nothing to do with company culture, it could be a reduction in demand or recession, but a fall in productivity can indicate a problem.
If your onboarding process is comprehensive and cohesive so new recruits can enter your organisation confident in what their role is and what purpose they’re striving for, then that’s all good. The onboarding process is the opportunity to capture their loyalty and respect, and make them really understand the company ethos.
If they come away from that process not sure of their role or unorganised, then there’s a good chance your business is in a similar position culturally. Take a look at the onboarding processes you employ - are they antiquated or outmoded? Do they fit with the ethos and direction you’re trying to take? Is the process interesting and engaging as well as educational?
If you’re not capturing employee’s imaginations right from the start, it might be time to re-evaluate and look at the way you do things.
Company culture and synergy starts from the top and works its way down. If your leadership is lacking or too remote it can leave employees feeling disengaged and unable to voice their concerns effectively.
Taro Fukuyama, CEO of Fond, says: “Leadership should be the driver of company values, setting and recognizing good examples of work, and should be the first to address and fix issues when things take a wrong turn.”
Look at your management structure. Are they stuck in a routine? Are they difficult to approach? Are they responsive to change and willing to listen? Once you discover the answer to these questions you can start putting in place measures to ensure they’re more receptive to staff.