The Right Culture Positively Impacts Your Bottom Line

a cartoon business man is lookiing through binoculars with a thought bubble of a dollar sign

It’s not just our intuition…there is growing proof that a strong, high performing culture can have a significant positive impact on your bottom line. So if you are hoping to increase revenues or profits, take a close look at the prevailing culture at your organization. We define corporate culture as how things truly get done. It can be measured by understanding the way people think, behave and work.

A recent Glassdoor study found that the companies on their “Best Places to Work” list outperformed the S&P 500 for five straight years from 2009 to 2014. And, with even more data, Fortune agrees. The magazine claims that their portfolio of “Best Companies to Work For” outperformed the S&P 500 by 84.2% since 2009 and surpassed the overall stock market. Our own organizational alignment research found that corporate culture accounts for 40% of the difference between high and low performing organizations in terms of revenue, profits, employee engagement, customer retention and leadership effectiveness.

More leaders are learning about the strong correlation between high performance corporate cultures where employees are productively and satisfactorily engaged and the financial returns of these companies. The question is: What is it about these great places to work that keeps their employees happy and committed to them? In other words, what does a culture of high engagement look like?

Here is what we have found are the factors that support a high performing culture where workers are fully engaged and challenged:

  1. It’s first and foremost the people.
    When workers can interact with each other with trust and mutual respect, there are bonds formed that allow higher levels of discretionary effort, collaboration and loyalty. In general, the most effective individual bonds are built on a strong foundation of character and competence…in a nut shell, good teammates that consistently perform at the proper level in the right ways. As a leader, make sure that you provide opportunities for employees to get to know one another on an individual basis and be clear about performance and cultural expectations.
  2. Next, it’s the company’s strategic drivers – vision, mission and values.
    When the company exists for a reason beyond just the profit motive, employees can identify with and commit to a greater purpose than just clocking in each day. They know how they contribute to the overall purpose of the organization and, therefore, are more committed to its success. Make sure your corporate vision clearly articulates what you hope to become. Then ensure that your company mission outlines your organization’s core business and fundamental purpose. Lastly, ensure that your corporate values reflect your fundamental beliefs and critical decision-making filters.
  3. And don’t forget the role leaders play in creating a positive environment.
    Great leaders set the stage and embody the behaviors that strengthen and reinforce the corporate culture. They model open communication, integrity, an attitude of continuous learning, and a genuine concern for the wellbeing of their employees. When the company leadership exhibits and values these behaviors, they will cascade down through managers to teams and to team members.
  4. The final piece is how you recognize and treat behaviors.
    Strong corporate cultures are best represented by their highest performers. And the highest performers (in terms of results and desired behaviors) should receive the commensurate share of the recognition and rewards. Conversely, underperformers (in terms of results and behaviors) should be helped to improve or to move on in a timely and compassionate manner so you can consistently maintain high performance standards.

Don’t underestimate how critical a positive organizational culture is to your company’s success.

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Intuit

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