The average employee works nine hours a day. Sound about right? Is spending a third of your life working in a place that makes you unhappy, frustrated or downright upset – worth it? Probably not however, most people in that situation don’t have an alternative but maybe we can help! even though we can’t adjust your company’s culture for you, we can give you good reasons for why it matters and help set you on a course for change.
Monetary benefits of good company culture:
There’s an online mattress company in Arizona called Tuft and Needle who are top-ranked for their products AND their company culture. In five years of business, their turnover rate is less than 5%. In case you’re wondering, the average is about 15% across all industries so, Tuft and Needle is winning there. And by winning we mean in cost savings.
Hiring costs are roughly 10 – 20% of that position’s yearly salary and on-boarding their replacement is estimated at about 7.5 times the yearly salary. Plus, productivity is 20 – 30% higher when employees are happy. If you run the numbers, costs add up fast. But to give you an idea, the cost of turnover on a $40,000 worker is about $28,000.
Growth benefits of good company culture:
The immediate monitory benefits are nice but what about the long-term outlook for your company? With more job related apps such as Glassdoor where current and former employees can anonymously review your company, the culture needed to attract top talent is highly competitive. In other words if you want the best employees who stay loyal and happy, you need to focus on culture first.
Company culture – what is it?
In a nutshell, culture is the personality of your company. The environment at your workplace; doors and cubicles vs. an open office, perks like free lunches or healthcare and retreats, how communication happens and the outlook from management. All of these factors play into company culture.
Company culture can be complicated or simple but mostly it’s made up from a combination of these traits:
Story – The narrative driving your employees’ commitment to your culture. When developing your ideal culture, this is the starting point. What’s your story behind why you focused on it, what are you trying to accomplish, how did you come to this place?
Vision – What you’re striving for as a group. Examples include top-notch customer experiences, the best XYZ, or fastest ABC.
Values – The common traits of the group. Which traits are most valuable? Maybe it’s honesty and integrity, or a great sense of humor. Whatever it is, it’s important everyone aligns with it.
Practice – The action behind the values and vision. If sense of humor is important, make sure the atmosphere is conducive to joking around. If it’s honesty and integrity, this comes from the top down – live it, breathe it, and most importantly, be a role model no matter which traits you pick.
People – The employees who are practicing the values and vision. Interviewing and slowing down the hiring process is the best way to approach your commitment to culture. Make sure other employees are involved and buy-in that the candidate is the best fit and ask smart interview questions that will vet for good culture fits.
Environment – The space you share. From an open office to 100% telecommute, no matter where you work, there’s an environment specific to your culture. If you don’t purposely create one, the environment will create itself, which is, sometimes good and other times not. Don’t leave it to chance,
For many reasons, company culture is critical to the success of any organization. If you haven’t yet formulated a plan, it’s not too late and the reward for doing so is unlimited!