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Good Company Culture: Your Cheat Code to Profitability

About This Talk

This talk is by Melanie Chandruang and was recorded on October 5, 2020. You can learn more about Melanie by:

Other links:

  • 15Five – performance management software and tools
  • Culture Amp – employee engagement and management platform

Timestamps

00:00 Intro
04:20 What is company culture?
16:45 Benefits of Good Company Culture
25:47 5 Qualities of a Healthy Culture
46:14 3 Action Steps You Can Do Today

What Is Company Culture?

Company culture is “a group set of values, habits, and beliefs, and how they are used when interacting with each other. Especially when things get tough!” That’s Melanie’s definition.

So what is the culture like at your current organization? Is it caring? Is it a safe environment to share opinions? Or is it toxic, making it difficult to communicate, share opinions, or deliver bad news that needs a solution?

If you’re not sure what your culture is, or how to formulate it, try jotting down a few words you’d use to describe it. 

Benefits of Good Company Culture

Having a good company culture can lead to huge success. Look at some of the companies with top cultures: Microsoft, Zoom, Google, and others. 

Good culture doesn’t happen on accident. It takes the intention and hard work of leaders, and requires constant maintenance and care. But good culture is worth it. Besides being the right thing to do for employees, it has immense and measurable business benefits. 

If you’ve ever been part of a toxic culture, then you know just how difficult it is to thrive in an environment like that. It stifles collaboration, profitability, and increases employee turnover, which is bad for your company!

Here are the 6 big benefits of having a healthy, thriving company culture. 

Increased Efficiency

Your team will push for improvements and want to make the company more adept. Employees who care about their work and clients will drive better outcomes for everyone. A strong positive culture can enhance employee engagement by 30%. 

Less Turnover

“Highly engaged employees are 75% less likely to be looking for a job compared to disengaged employees.” Think about all of the time and money you spend finding candidates, interviewing them, training them, and bringing them to full productivity. There’s also the opportunity cost of lost billing or client work, so reducing turnover is critical to profitability. 

Happier Clients

Clients want to work with companies that know what they’re doing and have positive cultures. I mean come on – would you rather work with Winnie the Pooh or Eeyore? Loyal customers are 5x more likely to buy again, so having a culture that attracts great clients is critical. 

Easier to Recruit

One of Mel’s former clients had a toxic culture, and it made it very difficult for them to recruit. Good company culture will help you recruit because you’ll get positive reviews, stronger recommendations, and more organic word of mouth from current and past employees.

Increased Profitability

By reducing employee churn and increasing efficiency, you’ll drive profitability, which is the goal of all of this! 

Less Stress

3 out of 5 workers say they feel burned out. Who wants to add a negative company culture on top of that? Reducing stress can help employees do their jobs better, and productive, lower-stress employees will help reinforce your culture. It’s a positive feedback loop. 

5 Qualities of a Healthy Company Culture

Strong Communication

Communication needs to work well from bottom-up, but also from the top down. A hallmark of strong communication is that everyone understands what their role is, and how that relates to departmental and company goals. Your team members also need strong listening skills so they can truly understand what others say to them and how they feel.  

Aligned Values

Ensure that the values at your organization are “guiding them to a unified goal at the company.” This should function on the level of individuals and your whole organization. Values can also create a helpful rubric for choosing clients, who should also share your values whenever possible. Even if you have to take on a project just for the revenue, tell your team! Transparency is critical, and that can (and should) be one of your values. 

Managers Who Manage

Managers are essentially people coaches. Instead of focusing on just “getting the job done,” managers should create an environment where people can grow, not just be criticized. 

A Team That Celebrates

Celebrate the wins and good news constantly! As a rule of thumb, try to praise three times more than criticize. Decide on how your company will use celebration rituals to engrain the necessity of recognizing achievement. You may include #wins channel in Slack, or recognize a team member every week at a company meeting, or send out weekly updates that include praise. Don’t wait to celebrate your team every quarter or once a year – they deserve better. 

Have a Safe Environment

This is the most important of all of the aspects of a healthy culture. If you take nothing else from Melanie’s talk, make sure it’s this! Team members thrive in an environment when they can be themselves without facing shaming or rejection. Ask for feedback and regularly convey feedback (and praise!) to your team so they understand that you’re truly dedicated to a healthy and safe environment. A few helpful tools for creating a safe environment include:

  1. Find common ground, even when you disagree with an idea.
  2. Target criticism at behavior and ideas, not people.
  3. Never shame your team.
  4. Deliver praise in public, and criticize in private.
  5. One bad team member can ruin a culture you’ve painstakingly built – there can’t be exceptions made, even for superstars.

3 Action Steps You Can Do Today

There are three steps you can take today to improve your company culture:

healthy-company-culture

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