When an organization has a healthy culture, workers are motivated to go to work and are more productive. When we think about companies who have happy workplace cultures, many of us think of big corporations. For example, Google has a great reputation for a happy, healthy culture; who wouldn’t want to work where lunch is free or where there is on site laundry (Mirmotahari, 2021)? But, when the workplace culture is not healthy, important factors like productivity, attendance, retention and loyalty all suffer. In fact, fifty-eight percent of workers in toxic workplace cultures state they look for other jobs because of the negativity of their managers (SHRM, 2018); almost 10% of job-seekers look for a new job while actually at work (Pieniazek, 2021). Whereas it used to be common for job seekers to accept a job offer and hope for the best, job seekers are now able to research what it’s like to work for a company through the eyes and opinions of actual employees and ex-employees even before applying. This changes the landscape of competitiveness amongst organizations; not only do they have to compete for business, organizations are now competing more than ever for employees. What attracts employees to apply for a job is no longer based solely on salary, but now includes the culture and core values of an organization.
Changing an organization’s culture may seem time-consuming and expensive, but American companies have managed to waste nearly $223 billion in the past five years solely on the turnover related to unhealthy work cultures and poor leadership (Alonso, 2019). Companies with toxic-culture are spending in excess of $7.6 million (around $4700 more per hire) trying to attract new talent (Burgess, 2016). It’s clear that culture has become one of the most significant factors determining where and how people work. For instance, one study showed that millennials would rather take a $7600 per year cut in pay in exchange for a healthier workplace culture (SHRM, 2021). Given all of the expenses accrued due to unhappy employees, organizations should take note of the impact these unhappy employees have on their bottom line. While this may seem obvious, the data shows that there is definitely a gap between what the decision makers think is working for their companies and what is actually happening.
The pandemic has been a time of chaos and change. Employees have looked to managers and leaders as these latter decision makers have been forced to make bold moves and changes to keep businesses afloat. The canvas is ripe for change because workers have become accustomed to the chaos. More than ever, leaders (including the C-Suite) have had to become more transparent than before the pandemic. Leaders who practice their company’s core values are more likely to retain their people and carve out a long-term plan for success than companies who mismanage their profits by not considering the reasons for low productivity or employee turnover. The consistency of what leaders say and what they actually do sets the pace for the entire organization. Now is the time for companies to consider revisiting their core values. Leaders can share these core values with their teams and at the same time ask their teams what they need to succeed, reassure them that the organization cares, and most importantly, follow through with any concerns shared. This will lead to higher morale, better retention rates and higher productivity. In short, such an approach could be what turns a toxic culture into fertile ground where employees thrive and become happier. The cost of compassion, caring, and empathy is much lower than any of the costs related to toxicity. If you want to increase your bottom line and improve your culture, begin by investing in your most valuable asset—your people.
Alonso, A. (2019). Workplace culture matters. SHRM. Retrieved from https://www.shrm.org/hr-today/news/hr-magazine/winter2019/pages/workplace-culture-matters.aspx.
Ariella, S. (2021). 27 US employer statistics. https://www.zippia.com/advice/employee-turnover-statistics/
Burgess, W. (2016). A bad reputation costs a company at least 10% more per hire. https://hbr.org/2016/03/a-bad-reputation-costs-company-at-least-10-more-per-hire
Mirmotahari, T. (2021). 11 Awesome Google benefits and perks for employees. https://www.perkupapp.com/post/11-awesome-google-benefits-and-perks-for-employees
Pieniazek, J. (2021). Time wasters on the clock. https://www.resume-now.com/job-resources/careers/time-wasters-on-the-clock
Shrm. (2021). Understanding and developing organizational culture. SHRM. Retrieved from https://www.shrm.org/resourcesandtools/tools-and-samples/toolkits/pages/understandinganddevelopingorganizationalculture.aspx.