“Culture is not about being cool or even being a ‘best place to work.’ It’s about being more successful. Period.” Thus begins a recent article from Ere Media. Just what is the connection between business culture and business success? Is culture as important as many claim?
Good Culture Attracts and Retains Talent
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The companies with the strongest cultures tend to have much lower turnover rates than others. In fact, voluntary turnover in companies that are considered good places to work is often only 65 percent of that experienced at other businesses. Less turnover equates to time and money saved.
Another important note about good company culture is that it contributes to employee happiness, and happy employees are more productive employees. Dr. Noelle Nelson, a clinical psychologist, says, “When employees feel that the company takes their interest to heart, then the employees will take company interests to heart.”
In the same Forbes article that quoted Dr. Nelson, it is noted that in one 10-year period, stock prices rose significantly more within companies that made it to the Forbes 100 Best Companies to Work For list than within the overall market.
Values and Innovation
Some business managers may wrongly assume that the key to creating strong company culture is merely to offer more perks to employees. While free food and extra paid time off can certainly let employees know that their employer appreciates them, more is necessary.
A company in Nebraska that repeatedly earned honors for being a good place to work focuses on making sure that its values permeate every aspect of its operations. The company, which provides rehabilitation services, keeps their primary mission — that is, to improve lives — at the forefront of everything it does.
Innovation is also key in creating a good corporate culture. For example, Google, which is famous for its unique corporate culture, encourages employees to spend up to 20 percent of their time working on their own projects that they think will benefit the company. While this 20 percent policy is often a topic for debate in the corporate world, it still illustrates that appreciating employees’ ideas is another key to cultivating a successful company culture.
Attitude Builds Culture
How can MBA students and current business leaders create company cultures that drive businesses toward success?
Culture is often more about attitudes than it is about tangible perks and benefits. For example, most companies offer paid vacation days to their full-time employees. Vacations can lower employee stress and contribute to employee happiness. However, according to PR Web, on average, employees only took advantage of about half their vacation time last year. This was in part because they did not feel comfortable taking that time off. They feared that taking a vacation would make them seem replaceable. A successful company culture not only offers good perks, but it also promotes using those good perks.
A thriving, innovative corporate culture can contribute greatly to a business’s success. By promoting company values and designing policies around those values, business leaders can help their team members perform to their best abilities.