The unemployment rate in the United States currently sits at about 4.1 percent, the lowest it has been in nearly two decades. That has put job seekers back in control of the job market, particularly in the tech industry. While there are reports that salaries are finally on the upswing after years of stagnation, business owners must ask “what is company culture’s role in the future of business?”
Career site Glassdoor reports that nearly 60 percent of all workers say perks and benefits are among their top employment considerations, and almost 80 percent of employees say they would opt for new benefits over a pay raise. Perhaps that’s not too surprising, given that the average person spends 90,000 hours at work over a lifetime.
Companies like Google and Facebook are famous for their full-service campuses that sound like an adult version of Willy Wonka’s Chocolate Factory, from its gourmet food to the Wi-Fi enabled buses that ferry workers to and from the facility.
However, Google and Facebook aren’t the only cool companies to work for. There are plenty of big corporations and startups that offer perks and a unique workplace culture that helps attract and retain the best employees, with human resource benefits for both employer and employee. Great culture promotes shared values related to helping employees maintain a healthy lifestyle, such as offering free health-conscious food or subsidized gym memberships. The benefit here is obvious as companies spend more than 7 percent of their budget on health care costs.
Other perks just seem like fun, from hosting soccer tournaments to jamming in the company’s music studio. Company mission statements that show employees are a top priority are seeing a payoff in their bottom line.
At the same time, the set of values that a business promotes for culture fit should have to do with more than just ping-pong tables and risk-taking. An organization’s culture needs to be aimed at decision making, management styles, and work/life balance.
Here are 17 how a successful company’s culture can make others envy them:
Why Focus on Company Culture?
A 2016 report from the Institute of Labor Economics showed a positive correlation between a rise in happiness and an increase in productivity. Experiments involving close to 800 subjects found that a rise in happiness from great company culture leads to a marked increase in productivity in a paid piece-rate task.
Providing meaningful work will produce higher quality results. That’s the conclusion of a study in the Journal of Economic Behavior & Organization that involved 2,500 workers and covered organizational culture. While all were paid equally, some were told the work they were doing would be analyzing medical images of cancerous tumor cells while another group was told their work would be discarded. The former spent more time on the task, meaning they were earning 10 percent less on average, but the quality of work was better.
It’s not always about the money, says a study commissioned by the Association of Accounting Technicians in the United Kingdom. About 80 percent of 2,000 people polled said they would turn down a big salary increase if it meant working with people or in a work environment they didn’t like.
The reality is that a company that ignores fostering a positive culture will pay the price. The cost to hire people and retrain an employee varies, but estimates range from 50 percent to 450 percent for a highly skilled salaried new hire.
Top 4 Tips to Improve Company Culture
- Empower employees – Design employee roles in ways that will motivate them and increase employee engagement.
- Toyota encourages assembly workers to suggest new tools and designs on the factory floor.
- Review together – Avoid performance review systems that encourage an adversarial dynamic between employees and focus on team building for a strong culture.
- Zappos encourages egalitarian performance reviews as part of their corporate culture.
- Embrace transparency – The more employees are looped in, the more problems can be solved before they hit crisis level.
- Buffer reveals the pay rate and formula of each new employee by name, which helps reduce feelings of frustration when everyone understands the pay structure.
- Build teams not cults – Team members can encourage innovation and creativity, while still leaving inclusivity as one of their core values.
- In one MIT study, changes in a bank’s call center break schedules, designed to increase team cohesion, increased productivity by $15 million.