When it comes to making a decision about career moves, what is most important? Is it the title? The salary? The location? Our sister company, Alderson Loop ran a LinkedIn poll asking for people to weigh in on the topic. The results? Overwhelming support for one job factor: CULTURE. Company culture accounted for a whopping 54% of all votes. Salary came in second at 34%, as location and title came in a distant third and fourth, polling at 8% and 4%, respectively.
So why is company culture so important? Because just about every facet of your company benefits from having a strong culture. For starters, it makes it much easier to retain top performers and this is important for multiple reasons. According to The Society for Human Resource Management, the cost of directly replacing an employee can run as high as 50-60% of their annual salary. Having strong culture quite literally saves you money on top of what those top performers are doing for the company in their day to day work. Not only does this continue to grow your company in terms of revenue, but it continues to grow company culture. As business expands and brings in new people, an organization needs some veterans (as well as management, of course) to ensure that the company culture is ingrained in your new team members.
On top of simply retaining your employees, cultivating a strong culture can actually improve their productivity. A Harvard Business Review article that outlines the negative effects of poor workplace culture highlights the cost of disengaged employees; “In studies by the Queens School of Business and by the Gallup Organization, disengaged workers had 37% higher absenteeism, 49% more accidents, and 60% more errors and defects. In organizations with low employee engagement scores, they experienced 18% lower productivity, 16% lower profitability, 37% lower job growth, and 65% lower share price over time. Importantly, businesses with highly engaged employees enjoyed 100% more job applications,” (Seppälä and Cameron, 2015). When employees are happy and are able to work in a strong, positive environment, it’s no wonder that they perform at a higher level.
So how can you cultivate strong workplace culture? Organizational culture is a result of employees living out company values, so it’s important to prioritize those values. At Alderson Loop, our values are kindness, responsiveness, honesty, resiliency, and focus. Our employees ideally apply those values everyday, in every decision. Beyond having clearly defined values, employees need clearly defined goals. Understanding where the company is headed and what they’re trying to accomplish makes it much easier to understand how an employee’s day-to-day responsibilities actively contribute to company success, giving their work purpose. Maintaining a positive environment with encouragement is another pillar for strong culture. Not every task needs a pat on the back, but functioning in a positive environment is everything when it comes to employee engagement- and engaged employees are productive employees. Finally, it’s important to engage your employees beyond work. Celebrate small milestones, participate in team bonding exercises, get to know your team on a deeper level. Let them know that you don’t just see them as employees, but that you see them as people. This not only strengthens your personal connection, but your connection as a company as well.
Overall, strong company culture results in higher employee engagement, which results in higher productivity. Strong culture should be a no brainer! Cultivating such an environment is easier said than done, but the benefits are well worth it.