Seven Steps toward a Stronger Culture with Financial Benefits

Discussions with several CEOs, and trusted advisors who work with CEOs, make it quite clear that staffing challenges – recruiting and retention – are one of the top issues business owners and leaders are wrestling with in 2022.

One of the most significant advantages — or impediments — to recruiting and retaining the best employees is an organization’s culture. Yet many CEOs do not pay adequate attention to their culture.

Some of these CEOs run very successful companies. But for how long? They can be addicted to the misleading busy-busy pace and overlook signs of risks to their culture and impending profit-robbing talent gaps, or tell themselves they’ll deal with it soon but never get to it.

Yet the financial costs of ignoring culture are significant. Kotter and Heskett’s landmark HBS study, “Corporate Culture and Performance,” documented the following results for 207 large U.S. companies in 22 different industries over an 11-year period:

A toxic culture can lead to a revolving door of employees, which in turn negatively impacts morale, productivity, profitability, and the ability to provide quality service for their customers.

So what can CEOs do about it?

Below are seven strategies that can help build a more powerful and profitable culture, slowing the flow out the door, and helping decrease attrition while increasing teamwork, engagement, productivity, and retention.

• Hire for Fit and Diversity

Develop a description of the people who will best fit with and most benefit the team. Skills are important, yes, but most people can learn what’s required to do the job well. Personality and work ethic have an immense impact on culture and team cohesion. So choose people who want to contribute and learn, who enjoy teamwork, and who are collaborative, creative-thinking, and fun.

Keeping diversity in mind is critical. Differences in age, gender, background, culture, and industry to name a few, yield innovation and a variety of skills, talent, perspectives, and experience.

• Develop the Team’s Mission and Goals

Assign this to the team, help guide them, and get them involved. Ensure the team’s mission aligns with the organization’s mission and vision but allows room for the team members to express their creativity. Ask each team member to identify their individual goals as well. As you can imagine, this approach fosters more buy-in and adherence.

• Embed Frequent Team-Building Practices

Creating team engagement and cohesion is a process, which takes focused effort and time. Implement connection activities in staff meetings and have regular team-building exercises. Assign to the team the objective of creating games and activities they think will help build teamwork.

• Create an Environment of Trust and Safety

Building trust is key, and without it, effective team engagement and cohesion are unlikely. The need for trust applies 360 – between you and the team, and between all the members of the team. This trust starts with you, the leader.

Your authenticity and vulnerability will set the example. As the team’s role model, the more real you are, the more human you are, and the more trust you build by giving them space and freedom to openly voice their opinions and ideas without fear. Be encouraging, accepting, and curious about their thoughts. How do you achieve authenticity and vulnerability? Through deep and comprehensive self-awareness (see Step 5.).

• Gather Actionable Individual Insight for You and Your Team

Using an accurate, comprehensive assessment tool to determine specific talent areas, personality characteristics, areas to address for improvement, and potential conflict points can be powerful.

Armed with such information, leaders can assign projects and positions much more effectively, thereby increasing engagement, morale, and retention, while also gaining awareness of conflict triggers and how to handle them. Team members will understand each other at a deeper level, thereby boosting teamwork and cohesion.

• Delegate Authority

Give your team space to make decisions and take action independently. In many exit interviews, departing employees complain bitterly about being micro-managed. Ensure they know you value their work and contributions, and that what they do is important to the team’s and organization’s success. Consider having monthly check-ins on the mission and goals they created, and have open discussions about progress and necessary revisions or actions.

• Plan Fun and Celebrate Successes

Your organization’s culture plays a critical role in engagement and retention. To get the best performance out of your team, create a culture that they look forward to being a part of every day. Plan fun, be fun. Put the team in charge to generate ideas, such as joint volunteer work, team outings, lunches, and scavenger hunts.

Don’t forget, no matter how busy you get, to celebrate successes, achieved by the team and by individuals on the team. Let the team generate ideas as to what they would like those celebrations to look like. Give them a budget and let them have fun with the brainstorming.

Improving culture through team engagement and cohesion takes time and effort but pays for itself many times over with higher productivity and retention. As you know, this has a positive bottom-line impact. And it’s more fun as well!