Is workplace culture worth the time and effort

Every organisation wants a great workplace culture – but creating that culture requires significant investment of time, effort and sometimes money. 

It can also be a challenging and uncomfortable process to take your organisation (or team) through the ‘growing pains’ when people and established habits/ processes resist even the most positive changes. Many leaders, myself included, have started a culture shaping process with an inspiring vision of what could be achieved, only to question their wisdom when things turned ugly.

A great workplace culture is also an elusive beast. Once you capture it, keeping it is a challenge. Set and forget is not an option, a set and forget – we have a great workplace culture, now let’s focus on something else. If you don’t constantly work at it, culture slips backwards.

Have I talked you out of investing in your workplace culture yet? That is not my objective, but you do need to ask whether it is worth the effort? Would you be better to invest all that time and energy into driving results? Maybe. It depends how committed you are.

If you aren’t Authentic about your workplace culture, then it isn’t worth the effort. We use Authenticity as a measure of how committed you are to aligning the way the organisation, and it’s people at all levels, behaves with the culture you claim you want. You can’t half ass culture change by trying to achieve change without creating ripples. That approach creates pain without the gain – people are disrupted and resentful, teams become dysfunctional, results suffer, and no-one is clear about what is really expected, and the culture stays the same (or only tokenistic progress is achieved).

However, if you are fully committed to creating the workplace culture you want, mountains of research are on your side. Fortunately, the choice between working on the culture and driving results is one you will never need to make. Study upon study has found that the most effective way to drive results is through improving the workplace culture. When workplace culture is strong, results are inevitable.

The only exception is in achieving very short term results – it is possible to generate those while destroying the workplace culture, but it is a very short term game with significant downsides once the cultural impact kicks in. Critically, even short  term results are enhanced by strong workplace cultures.

A 2003 study by Harvard Business School found that workplace culture is strongly correlated with long term economic performance and financial growth. 

A more recent study by Queens School of Business and Gallup Organisation, looked at the impact of disengaged workers:

  • 37% higher absenteeism
  • 49% more accidents
  • 60% more errors


They also looked at organisations with low employee engagement scores and found:

  • 18% lower productivity
  • 16% lower profitability
  • 37% lower job growth
  • 65% worse share price performance over time

 
Businesses that had highly engaged employees, attracted twice as many applicants when they advertised vacancies.

John Kotter, a world leading expert on organisational change, co-authored a book with James Heskett called Corporate Culture and Performance in which they published and discussed the results of their research. They compared results for organisations with, and without, what they defined as Performance Enhancing Cultures. 

One of the metrics they looked at was revenue growth. Over an 11 year period, organisations with Performance Enhancing Cultures grew their revenue four times as much as those without that culture (682% versus 166%). What about the short term? The mathematics is beyond me but you can’t get 682% over 11 years without getting significant growth for most – even all – of those years.

Kotter and Keskett also measured net income growth which was 756 times as high – so organisations with great cultures don’t just earn more revenue, they do it efficiently.

All of this research really just confirms what we know from working with organisations and teams for thirty years: if your focus is on building an exceptional workplace culture, results will inevitably follow – and they feel effortless and become self-perpetuating. It is easier to attract and retain good people, customers deal with you because they are excited to (rather than needing to). People enjoy coming to work and there is less stress for everyone – leaders and their teams.

If you have read this and decided that culture is fluff and results are king, you are going to hate our blogs (and I would avoid our podcast as well!).

However, if this article has confirmed what you already knew – that the sustainable path to exceptional results IS culture – please subscribe so you never miss an article. In future blogs, we will look at what leaders can do to build the culture they want and that drives outstanding results – a culture of Authenticity.

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