Calling all CEOs…toxic organisational culture is negatively impacting your business in more ways than you think.
Here’s what we know:
A great company culture supports business growth and success. In fact, the Mercer 2019 Global Talent Trends study indicated that high-growth companies are 4x more likely to have a people strategy in place.
Furthermore, LSA Global finds that companies that have their culture and business strategy in alignment are likely to grow their revenue by 58%.
However…
A toxic organisational culture has the ability to negatively impact revenue, brand reputation and brand loyalty. According to a survey by SHRM, one in five American employees left their job in the past five years citing bad company culture as their reason for leaving.
The cost of high employee turnover?
It’s an estimated $223 billion!!
Let’s take a look at the popular company culture example: Uber.
We’re no strangers to Uber. Their company has in recent years taken a major knock with allegations of harassment and discrimination, and the global public is infuriated by this.
The result?
A decline in stock value, bad publicity, a drop in consumers who’ve decided to rather use a competitor service called “Lyft” as their way of protest, as well as the stepping down of their CEO.
This negative spotlight drew attention to the type of company culture that Uber embodied, but also highlighted the culture of their competitors “Lyft” have.
Uber, on the extreme end of negative company culture, have experienced deep financial impacts on their company and its success. Lyft, on the other hand, was were praised for a “community-centric culture” which ultimately added to an increase in business, affecting their bottom line positively.
So the questions then become:
How do you retain employees?
Mentorship
A move from management to a process of mentoring can have great results in reducing employee turnover for your company.
Mentoring can have a significant impact on the mentee, from learning new skills to an increase in productivity and motivation. It also harnesses a culture of collaboration over the well-known competitive structure, so many corporate environments are based on.
In fact, a Wharton study indicated that “people who mentor were promoted 6x more than people who didn’t, and mentees were promoted 5x more. …And retention was 20% higher!”
Employee recognition and appreciation
Our business is all about effective employee recognition and appreciation. It is a basic human need to desire appreciation and respect.
It’s important that your business considers how this is currently being implemented, either formally or informally. In the case of the latter, we highly recommend developing a formal recognition program to fully harness the value this can have in your business.
Empowerment
If you hired the correct employees, empowerment wouldn’t be a problem for your business. You need to empower your employees to make decisions, take ownership and responsibility and allow themselves to explore themselves as leaders and valuable contributors to your business.
What are the tell-tale signs of a toxic organisational culture?
Office gossip
Gossip in the workplace is often an indicator of unhappiness and dissatisfaction with one or more things in the workplace. Negative gossip can lead to misunderstandings and elevated emotions if not dealt with quickly and effectively.
Lack of empathy
Having empathy for your employees and the lives that they lead in and out of the workplace is important. In fact, according to Businessolver’s 2019 State of Workplace Empathy Report, 82% of employees would consider leaving their job for a more empathetic organisation.
Poor management and lack of effective leadership
Leadership does not always come naturally to the people who occupy leadership positions. It is, therefore, worthwhile considering leadership training and development so that your management is reflective of the type of culture and work ethic you want your company to embody.
Points of friction or conflict can often be attributed to poor management and leadership, which results in reduced productivity and workplace dissatisfaction.
Key takeaways:
The 2020 Global Culture Report, highlights that by clearly communicating the importance of an employee’s contributions, companies can see a 15% increase in organisational clarity and a 21% increase in discretionary effort.
Building a strong company culture that’s strategically aligned with your business goals and objectives could be the single biggest competitive advantage your business could ask for. Don’t wait any longer.
If you’re looking to take steps toward tackling problem areas within your organisational culture, take a look at our innovative employee engagement platform.
This tool has been developed to revitalise company culture from the inside out. In fact, we’re so sure it will make it easier to manage a culture overhaul in your workplace that we’re going to let you try it free of charge. Simply click the button below to get started.