How Toxic is Your Company Culture and How can you Fix it?
How Toxic is Your Company Culture and How can you Fix it?
Creating a healthy company culture has always been the aim of leaders and HR, but is never that easy to put into practice. Add into the mix, the increase in home working, remote working, and hybrid working, and a healthy company culture can become somewhat elusive.
Leaders and HR will often spend many hours on focus groups and town halls in attempts to relaunch the company vision and values, but many have been hit with unexpected and often undesirable consequences. There may well be an exciting new vision for the company on the website, a glossy mission statement on the wall behind reception, and in some offices and meeting rooms elaborate values look down on team members and visitors. However, levels of employee engagement may be low and recruitment of top talent proving difficult.
During Executive Coaching and Mentoring sessions when CEOs ask me how they can improve their company culture, often we find that there is no buy-in for a new vision, mission, or values; this is frequently the case following a merger or acquisition. Often team members don’t feel part of the process, bemoaning the fact that they were not consulted, that the leadership team spent a perceived expensive two days at a strategy offsite, followed by the Marketing department producing shiny new company posters. Employees complain that a new culture is being imposed on them and some will rebel; the nay-sayers can quickly poison morale, leading to a downward spiral into a toxic culture, which can have a significant and negative impact on performance, productivity, customer satisfaction, and of course profit. Toxic cultures have sometimes threatened the very existence of an industry – as with car manufacturing in the UK many years ago.
Research published by The Culture Economy estimated that poor company culture has cost the UK economy well over £20billion in lost productivity, poor morale, ‘presenteeism,’ and general low performance. Whilst employment levels remain high – at least for the time being - some reports suggest that up to 70% of employees are actively looking for another role. Prior to Covid-19 changing our working habits, surveys often also suggested that 50% of staff left their roles due to poor managers.
So how do you find out if your Culture is Toxic?
Culture is usually defined as the way team members carry out their work duties, the processes and procedures involved, and the values they act on. However, it is much more complex than that and as culture is intangible it is very difficult to measure. I always say that you can smell or sense an organization’s culture as soon as you enter the Head Office; instantly you get to observe the dress code and the way the receptionist greets visitors, which often reflects the real company values. Although business leaders and HR are keen to influence company culture, unless there is complete trust and transparency, they may find it a challenge to gauge levels of engagement from the conversations around the water cooler.
With the majority of organizations now operating a hybrid working model, it is even more difficult to assess what people really think and want. However, circulating regular, anonymous Pulse Surveys is one effective way to assess whether employees feel motivated, developed, supported, and empowered, as well as understanding the key issues regarding the office environment and assessing the success of any well-being initiatives. Specific questions around values can be beneficial, however, in order for a company’s set of values to be instilled in all team members, leaders need to live them themselves and be able to role model desired behaviours and values. For example, if a key value is integrity and then a toxic leader is seen to be treating staff unethically, then they are not ‘walking the talk’ and will demotivate employees. We’ve all witnessed this with sports teams where a divide and conquer or harassment culture can literally split a team in two and result in chronic under-performance. A 360 Feedback Review is another excellent method of identifying if managers and leaders are modelling the company values and associated behaviours.
So how do you Act on the results of Assessments to Improve Company Culture?
- Empowering team members to come up with their own objectives, including personal, developmental, as well as performance-related ones
- Aligning KPIs with behaviours and values, not just business results
- Aligning behaviours and values with the vision and strategy
- Ensuring values and behaviours align with your Equality, Diversity, and Inclusion Agenda to Overcome Unconscious Bias
- Having a proactive performance management system
- Managers holding very regular 1:1s
- Increasing communication of key information, including the financials
- Encouraging a feedback culture which drives discretionary effort
- Offering Executive Coaching to support, develop, and motivate leaders
- Providing Training to upskill, motivate, and retain team members
We’ve all heard the expression ‘culture eats strategy for breakfast,’ from the late management guru, Mark Drucker, which was popularised by the former COO of Ford, Mark Fields, when he was tasked with making over 30,000 employees redundant. What the phrase means is that you can have the best strategy in the world, but if there is little buy-in from staff, then it will fail.
‘Thank you for the really insightful feedback. We hadn’t realized how disengaged the teams were with our new initiatives. Most are now on-board and we’re rolling out some great interventions.’ CEO
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