Culture is much more than a place and its perks; it’s about creating an ethos that empowers, inspires, and, ultimately, attracts. And if you do it just right, you will be known for it.
Why does corporate culture matter?
There are two quantifiable reasons why you should care about culture at your company:
- Employee attrition: You want to keep the great employees you have.
- Employee attraction: You want to hire more performers like them.
Today, employers are facing a retention crisis due to a newly stimulated economy and a healthy boost in jobs creation. With unemployment low (5.5%) and opportunities high (there were 295,000 new jobs created in February), employers need to adjust to a candidate’s market, keeping in mind that even mild discontent may lead to avoidable turnover.
On top of managing retention, employers also have to consider the socialization of their employer brand. Sites like Glassdoor, Indeed and Linkedin raise the blinds on what it’s like to work at your company, so if it’s not great, it won’t take long for current employees to leave and potential employees to reconsider.
A cautionary tale about stagnant growth
I have the opportunity to speak with many company leaders, founders and heads of talent. I often ask them, “What’s your biggest challenge as a leader?” In one particular conversation, the CEO of a small software company responded, “Attracting more performers to my team.”
He went on to explain that his small company struggled to grow — employee headcount had been fairly stagnant, and when they did hire, they were filling empty seats, not creating new ones. But what struck me most was his description of what he called a recent “mass exodus” of employees — some tenured, some at the executive level and some who’d only been on board for a few months. The company had turned over nine key employees in six months, and with fewer than 50 people, that was a significant percentage of the company’s headcount.
The one question every employer must ask
Instead of focusing all your energy on hiring performers, you need to take an honest look at the company culture you’ve created. Do you think yours is the sort of company top-performing employees want to work for?The truth is that top performers want a top-performing company. In the above scenario, it turns out the exiting employees widely regarded the company’s culture as sub-par, if not completely oppressive — leadership micromanaged, employees were berated in meetings and there was a complete lack of trust and empowerment. In addition, no one ate lunch together, and when the executive team sent updates, very few people responded — two subtle yet telling characteristics of a weak or failing culture.
I asked the CEO to tell me about the company culture he’d built. He described it as “laid-back, fun and rewarding,” citing perks like foosball and ping pong, unlimited snacks, company-sponsored happy hours and flexible work schedules. He ended by saying he also felt he compensated employees quite well, often paying above market value to “ensure performers only.”
This is what I told this company chief: As CEOs, we need to hold the mirror up and really evaluate our role in establishing not just a thriving workplace, but a thriving company culture. Only then can we expect to attract and retain performers.
There’s no such thing as a free lunch
Keep this economic adage in mind when you’re assessing the perks, benefits and other alluring offerings you use to attract top performing employees:
There’s more to work-life balance — and work-life happiness — than foosball and free snacks. According to Robert Levering and Milton Moskowitz, business journalists and coauthors of The 100 Best Companies to Work for in America, “The key to creating a great workplace is not a prescriptive set of employee benefits, programs and practices, but the building of high-quality relationships in the workplace.”Case in point: One employee from the aforementioned company revealed that she would rather take a pay cut than work within a culture of distrust. She later did.
Free snacks will leave a bad taste in employees’ mouths if said workers are otherwise not feeling empowered, not recognized for their contributions to the company’s success or not treated with respect. Performers, after all, consider your company’s success their success, and thus make both a top priority.
The people-culture conundrum: Which came first?
Like the chicken and the egg, with people and corporate culture, it’s hard to tell which one begot the other. The fact is, it’s irrelevant. People and culture are actually two components of one unending cycle: Culture will attract great people just as people will make a culture great. Phrased differently, corporate culture without people is pointless, just as people without culture are disjointed. It’s the play between the two that matters, not establishing precedence.
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