You’ve probably read countless articles and seen numerous presentations highlighting the importance of corporate culture. Unfortunately, most of the news focuses on measuring employee satisfaction.
What’s wrong with employee satisfaction?
Satisfied employees are happy where they are, but they aren’t necessarily engaged and motivated to do more to help the organization excel. Motivated and engaged employees want to push to be better and make the business a better, more fulfilling place to work.
As you consider industry employment trends and your business environment, think about it in terms of engagement. Fostering an engaging company culture is a business strategy that can shape employee motivation and improve your business performance in critical areas.
Culture Shapes Motivation and Engagement
Abraham Maslow’s Hierarchy of Needs gives us insight into what humans require and desire to live a fulfilling life. Work and career play a prominent role in helping people meet each of those basic needs. While the purpose of a business isn’t to help each team member self-actualize, an employer with a company culture that doesn’t help facilitate advancement toward that goal is at risk of losing star performers.
Consider this little bit of math to put the company culture concept in perspective.
There are 8,760 hours in one year. The average U.S. citizen gets 6.8 hours of sleep per night, taking up 28% of those annual hours. That means people who work at least 40 hours per week spend a minimum of 31% of their annual waking hours at work. (This figure excludes the typical two week’s vacation, five paid holidays, and five sick days.)
Who wants to spend over one-third of their waking hours in a ho-hum (or toxic) work environment?
How Well Does Your Culture Meet Needs?
Survival Needs. As long as you’re paying people to work, you’ve answered at least some or all of their survival needs. However, people stuck in survival mode will constantly be searching for something better. "Survival needs" can have different meanings for different types of workers. While high wages don’t necessarily lead to higher retention, fair wages will make a big difference.
Security Needs. People who don’t feel secure will not likely stay with your business for long. To improve people’s sense of security, you need:
- Strong, ethical leadership
- A workplace that doesn’t tolerate hostility, harassment, or bullying
- Transparency about company performance
Belonging Needs. Humans are social creatures, for the most part, and we like to feel as though we belong. Your company culture can address the need to belong by:
- Hiring for cultural fit
- Paying attention to onboarding and training needs
- Encouraging open lines of communication between coworkers, employees, and management
- Embracing diversity initiatives
Importance Needs. People like to feel important and that they have a role to play in their groups. Does your culture highlight and recognize team members to make them feel important? People who perceive a sense of importance also feel engaged in a company’s vision and mission. Include the following types of programs to help build up staffers and their understanding of their importance to the company.
- Recognition programs -- formal and informal
- Awards for achievement
- An employee newsletter or intranet where employee success stories are shared
Self-Actualization Needs. Most people strive to be the best version of themselves, and career accomplishments can play into self-actualization. How well does your company culture facilitate self-actualization concerning what your employees achieve? Self-actualization is the pinnacle of the hierarchy, so you have to think about what will be most significant and meaningful to your team culture and helping employees fulfill their professional potential. Programs could include:
- Educational assistance
- Wellness programs
- Community service and corporate social responsibility initiatives
- Flex schedules
Now, imagine how thrilled you would be to work for a company that can address each of these areas of motivation and need. Next, consider the competitive advantage of providing this type of workplace culture.
How Can You Tell If Your Company Culture Motivates Employees?
When you get company culture programs right, you will have more than just a group of happy employees. You will see the following measurable business outcomes.
1. Lower Absenteeism
According to Gallup, a highly-engaged workplace typically has a 41% reduction in absenteeism and a 17% productivity increase.
This improvement may stem merely from the excitement and tone of the work and the culture itself. Maybe your core values, which inform your organizational culture, include employee wellness programs and flexible schedules that make it easier for team members to stay healthy and work around outside obligations as they crop up.
2. Improved Retention
Another metric related to company culture is retention. Gallup’s study, mentioned above, shows that even in companies with high turnover, business units that focus on employee engagement and motivation have 24% less turnover.
If you think that higher pay is a factor in satisfaction and engagement rather than culture, think again. Glassdoor shared insights on the Harvard Business Review website about what motivates employees at work; compensation and benefits are rated among the least important factors. Across all income levels, Glassdoor found that culture and organizational values are the top motivators.
According to a two-year study of more than 500,000 U.S. workers, conducted by PayScale, the two most significant variables for predicting whether or not a staffer leaves are:
- Whether he or she feels appreciated
- Whether he or she believes the organization has a bright future
Company culture plays into both of those variables. Workplaces that put a premium on recognition and rewards, communication, transparency, and leadership will have few problems hitting the right notes with appreciation and feelings of security.
3. Happier Customers
If you’ve done the work to create a better culture, you should see it in your employees’ commitments to quality, safety, and customer service. Gallup reports that highly-engaged business units see a 10% increase in customer ratings and a 20% gain in sales.
4. Increased Profitability
If you have more productive, efficient employees who help increase sales and customer satisfaction, that leads to improved profits. Gallup reports that workplaces with a culture focused on engagement achieve a 21% increase in profitability.
5. Better Quality Candidates
Team members who love their jobs will often share their positive experience. This word of mouth can lead to employee referrals of candidates who may be an excellent fit for your culture.
The right corporate culture can also help your company win recognition and awards as a “best place to work” in your region. This type of buzz helps put your business at the top of mind for area job seekers.
Make Company Culture Work to Your Advantage
As you can see, company culture isn’t just some nebulous concept. Developing and maintaining a healthy and engaging corporate culture requires purpose, intention, attention, and budget. However, you reap real business rewards when you get it right.