Developing a strong company culture is more important than ever. Lacking one can lead to employee disengagement as well as turnover.
A Gallup survey shows that 67% of U.S. workers say they're not engaged, or are actively disengaged, at work. This mindset causes U.S. companies to lose $450 to $500 billion annually.
The benefits of a strong corporate culture
Whether you rely on full-time employees or freelance workers, a strong culture can help your bottom line:
- Cohesion: A strong corporate culture outlines the values, qualities and mission of an organization. This can create a consistent corporate identity for employees as well an image of the company for the outside world.
- Positive brand identity: An organization’s brand identity can also benefit if a corporate culture is well known among customers. A culture that has earned the respect of both employees and customers could positively impact sales and brand loyalty.
- Employee retention: A cohesive culture and positive brand identity can help attract and retain talented employees, then help retain them by fostering a sense of belonging.
The costs of losing employees
According to Korn Ferry the top reasons people look for a new job are:
- 33% say they are bored or want a new challenge
- 24% say the culture isn't a good fit
- 21% lost their job or expect to lose it
- 19% want a higher salary
- 3% say they don't feel aligned with company politics
Deloitte and the Society for Human Resources Management report that the annual employee turnover rate is 19%. It takes companies, on average, 42 days to fill an open position. And the average cost to hire a new employee is $4,129.
Building or improving corporate culture
- Understand your organization’s purpose: Articulate your organization’s goals. Determine what core values, standards and behaviors exemplify your purpose, and communicate them to all employees. Make sure all business procedures and processes align with your culture and review them regularly.
- Get leadership on board: Make sure the organization’s leadership exemplifies your culture in their management style, behavior and communication. This sets the tone for the company and inspires employees.
- Spread the word: Communicate the importance of your company’s purpose. If you’re hiring, explain your values and evaluate a candidate’s character as well as his or her skill set. Making sure current and future employees are aligned with your mission can help reduce turnover.
- Take it public: Consider naming cultural ambassadors who exemplify your company's culture. Encourage them to participate in industry or community events to showcase your values outside of the organization.
- Keep it up: Incorporate your cultural values into your day-to-day. Recognize employees who embody your goals, and empower employees to provide feedback. Keep your mission front and center to help it evolve and grow.
Consider naming cultural ambassadors who exemplify your company’s culture. Encourage them to participate in industry or community events to showcase your values outside of the organization.
Taking the time to develop a strong culture within your organization can have a significant impact on cultivating loyalty and retaining talented employees who move your business forward.
A strong corporate culture can take time to build. But if you start now, and create an open dialogue with your employees, you can start figuring out what your company values might be.
Learn about specific strategies in the article 8 ways to increase employee engagement.