6 Jun 2017
Posted By: Phil Dixon
Culture is king (or queen)! Company culture (or lack thereof) drives pretty much every business metric leaders care about including retention rates, productivity, profitability, quality, earnings per share, workers compensation rates, customer ratings and the list goes on, and on, and then on some more. The notion that employees that are “engaged” with their company culture has an irrefutable link to business success is no longer hullabaloo concocted by new age thinkers, academia or touchy feely HR folks. It is now fact borne out by several longitudinal studies and a quick glance at the Top 100 companies to work for in any area. There is no longer any doubt that culture is mission critical to your company’s success but if you don’t believe me keep reading and let the data and the wide range of successful businesses prove the theory.
The Data Says….
The Gallup Study is one of the most comprehensive culture and engagement studies with over 30 years of data and 30 million employees. Gallup lays it out simply:
“A highly engaged workforce means the difference between a company that outperforms its competitors and one that fails to grow”
● 147% higher earnings per share
● 10% customer ratings
● 22% profitability
● 21% in productivity
● 40% lower turnover
● 37% less absenteeism
● 48% fewer safety incidents
● 41% fewer quality defects
Other scientific research has shown that employee happiness, which is a key component of good company cultures, leads directly to employees who work harder. Additionally, studies have shown that the collective bonds and strong interactions that a robust company culture provides leads to significantly less turnover. Yes, it’s true! A company culture that produces happy, engaged employees who have strong relationships is a culture that obliterates competitors in almost every major key performance indicator.
So, it follows that top business leaders care about culture with studies showing that CEO’s and CFO’s agreed that company culture makes a difference in companies performance and value with 92% believing improving their firm’s culture would improve the value of a company. Company culture is no longer “believed” to be connected to company success but is now connected by facts, studies and rock solid data.
Who Is Doing A Good Job At This Culture Thing?
Still not convinced that culture is mission critical to your company’s success or that successful companies are investing in culture? How about examining Fortune’s “Top 100 Best Companies To Work For” list to check for companies that curate great cultures?
#2 – Wegmans Food Markets – Employees say “there’s a lot of love and caring” at this 100-year-old family-owned grocery chain, where workers have flexible schedules, ample promotion opportunities, and “feel like family.” But it’s the “small things that make a difference,” like free cakes on birthdays and hot chocolate in the winter for anyone who works outside.
#4 – Baird – Besides its famous, no ‘jerks’ policy (although they used an even more colorful word), the investment firm… policy, the investment firm gets high marks for a company culture that values integrity and teamwork. At Baird, founded in 1919 and privately owned, two-thirds of employees are currently shareholders. The feeling, says one, is that “everyone is playing the same game and we are all equal contributors.”
#8 – Salesforce – CEO Marc Benioff is the “soul of the company” and “truly leads by example” in “making the world a better place,” employees say, praising his full-throated embrace of diversity in a tumultuous political climate. Staffers gush about the “Ohana” culture (“family” in Hawaiian) that embraces equality, service, and innovation. Besides donating subscriptions for its technology to nonprofits and educators, it grants employees seven days off to volunteer each year and has given away more than $137 million.
And the list goes on of companies that have made culture a priority and are reaping the financial rewards.
The fact that company culture affects how employees perform is fairly intuitive to anyone who has ever, well, worked in any type of company in the last 50+ years. It stands to reason that when people feel positively connected, or “engaged” with their company culture and their jobs they stick around, they work harder, they make less mistakes (intentionally or unintentionally) and those factors (among many others) make companies more profitable.
The next logical question now that we are all in agreement that culture is mission critical to any company’s success is what does that mean for me or my company? To see how you can build a culture that drives employee engagement which in turn delivers on improvements to all your company’s key performance indicators contact us at InJoy Global.
What are some great things your company is doing to make your culture great?
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