We know that a better company culture has an impact on innovation1, creativity2 and productivity3. But it’s biggest impact on your bottom line comes down to churn. It’s not something you think about when you’re growing, but it can have a big impact on your margins.
Did you know it costs on average £27,500 to replace a staff member, from resignation to role advertising, team time in interviews, productivity loss, and then time taken to train and onboard?
The average turnover rate for a start up in the UK is around 36%4. If just 5 people chose to continue with your organisation a year, you’d save £137,500. Wouldn’t it be better if your staff didn’t want to leave?
The single most influential factor when an employee is deciding to move on or not is company culture5. It’s important. It’s the shared values, attitudes, behaviours, and standards that make up a work environment. Culture is what creates the day-to-day experience people have at work and how that experience aligns with the external brand and messaging of the company.
There are many things that influence a positive company culture. Here are our top three:
- How the organisation treats employees
This is a big one. Do your employees have a sense of belonging, and feel empowered and valued? Are they recognised for their achievements, and does everyone feel included? This includes how leadership and managers treat those underneath them, and how team members treat each other. - The company mission, core values and shared sense of purpose
This is a sense of alignment between an employees unique role and the company vision and core values, and how those values and vision show up in the wider workplace. When employees understand and connect with the purpose of their work, if they can see how their work contributes to the overall objectives of the organisation, they become more engaged, motivated, and committed. - How people communicate and set expectations
In a positive company culture, there are clear expectations around how work gets done, why that work is important, and how teams, managers and employees are expected to treat each other. Is the communication clear, and consistent, and omnidirectional? Communication practices can make or break a company’s culture – that’s because clear communication from leadership and management can either foster trust, inclusivity, and high performance, or create an environment where team members are confused, misunderstood, and disengaged. Companies that focus on setting clear communication standards, using inclusive language, and implementing feedback loops are more likely to see higher performance, engagement, and overall belonging in the workplace.
Building a strong positive company culture doesn’t happen overnight, and is typically the result of several intentional, well implemented and resourced people strategies. In the dynamic and often intense world of startups, employee engagement is not just a nice-to-have; it’s a critical driver of innovation, productivity, and overall business success.
If you’d like to chat about growing your company culture and your People Strategies, let’s chat: hello@nub-hr.com.
Sources:
1. https://www.sciencedirect.com/science/article/abs/pii/0923474895000046
2. https://eprints.bournemouth.ac.uk/30578/1/PDF_Proof.pdf
3. https://hbr.org/2015/12/proof-that-positive-work-cultures-are-more-productive
4. https://www.fsb.org.uk/uk-small-business-statistics.html
5. https://sloanreview.mit.edu/article/toxic-culture-is-driving-the-great-resignation/
