There is a famous quote said by Sir Richard Branson consistently circulating LinkedIn:
“Clients do not come first. Employees come first. If you take care of your employees, they will take care of the clients.”
Seems easy enough, right — make your staff happy and everyone lives happily ever after? You may even say you have amazing organisational culture. But do you really?
Around 40% of Australians report being very satisfied in their current job. Less than half. Many things come into play here, including location, age, industry, job flexibility, working hours and pay. Of course, you’ll never make everyone happy, and sometimes overtime, specific working hours or being in a remote location isn’t something you can control. But there are many ways you can improve your company culture so everyone is satisfied.
What is organisational culture and why is it important?
BusinessDictionary defines organisational culture as the values and behaviours contributing to the unique social and psychological environment of an organisation; AKA the things about your business that make your staff happy or unhappy.
But does the happiness of your staff really impact your business? After all, you’re paying them to do a job well.
The Happiness Dividend reported businesses with happy staff have a 37% increase in sales, a 31% increase in productivity and 19% higher accuracy in tasks.
When it comes to job satisfaction, 35.11% of participants in an Australian Human Resources Institute study said it’s one of the most important factors for deciding whether to stay with or leave a company.
Poor staff retention isn’t just a hassle, it can cost you big bucks too.
Potential costs associated with a staff member leaving:
- Any payouts to the employee.
- The cost of hiring a replacement (including advertising, application sorting, interviewing, recruitment costs, screening).
- Time spent training the new employee is someone’s time away from their role.
- Reduced productivity of new employee until they are trained to a level of their predecessor.
High turnover can also result in loss of morale in other staff, reducing productivity and creating a vicious cycle.
Where does organisational culture start and what influences it?
It’s important that organisational culture is cultivated at the very top level of management. There needs to be agreed business values, performance and appreciation incentives and respect of knowledge and skill (don’t micromanage for the sake of it). Once these have been agreed on, it’s up to management to champion and enforce each area.
This starts from the first time someone interacts with your business. Then, during the interview stage, it’s important it is relayed again and that they will fit the company culture. An example of this is our own Localsearch Careers page and employment process. It’s important to us that our staff are passionate about helping Australian businesses and are eager to always advance their own knowledge.
How can you improve organisational culture?
Okay, so you think you have a culture problem. You could start performing Braveheart-style speeches every morning, or you could narrow down the problem and fix it.
Step 1: Acknowledge and Identify the Problem
The first step is to identify if there is a problem. These are just some of the ways you can do so:
- Keep an eye on your staff turnover rate. The Australian average is 16% over 12 months, so anything over this may indicate a problem.
- Perform exit interviews for departing staff. What do they say? Pass on the feedback from the survey to the relevant people so they can act on it.
- Put key performance indicators (KPI) in place to monitor productivity drops or increases in certain areas of your business. For example, customer service staff may be required to answer calls within 3 rings or have a 4-hour email turnaround.
- Have staff complete an organisational culture survey. Advise your employees there will be no repercussions for honest feedback or have an external consultant perform the survey for total confidentiality.
- Listen to your customers. Are you always receiving negative reviews about your customer service? You could have a problem if it’s constant.
Step 2: Learn What Your Employees Want
In The 7 Hidden Reasons Employees Leave by Leigh Branham, it’s revealed that 89% of employers believe people quit because they want more money. In truth, only 12% of employees report this as the case. Good organisational culture will mean different things to different people.
You could have your staff fill out surveys every week (once every quarter or every 6 months is more suitable) or you could understand how their minds operate. But how?
Personality tests (like 16 Personalities) can reveal what makes people tick, where their strengths may be and how they like to be acknowledged. Some people prefer to be rewarded with public praise and recognition, such as employee of the month status, while others would prefer a bonus, pay rise or promotion. Plus, it’s a fun team-bonding exercise.
Step 3: Take Action
Now you know why your organisational culture is taking a hit, make sure you make attempts to resolve the issue. Sometimes there’s not much you can do, but where you can, do something.
Ways to make a difference:
- Put in place incentives, such as rewarding exceptional KPI achievers.
- Open lines of communication from management to staff.
- Give verbal or written praise where it’s due.
- Have career advancement opportunities.
- Ensure the KPIs in the place are achievable.
- Create clear business values and communicate it regularly with staff.
- Communicate with staff with negative attitudes to see how you may be able to resolve any issues.