The Importance of A Healthy Company Culture [Case Study]

All types of organizations, small to large, have a culture. This culture impacts everything as it is the culmination of values, principles and attitudes of the workers in the organization. It is the overall quality of the organization’s structure. 

Company culture is what top companies strive to strengthen as they know the importance of a healthy company culture. An organization with a positive or a healthy company culture has the traits and potential to survive and thrive.

Meanwhile, organizations with poor or toxic company cultures can’t get too far because it gets in its own way. Here are the characteristics of organizations with healthy and toxic cultures:

Characteristic of an organization with a healthy company culture:

  • Employee efforts are recognized
  • Excellent employee retention
  • Highly productive employees
  • Highly engaged employees
  • Loyal and committed workers
  • Leaders empower
  • Good teamwork
  • Promotes work-life balance

Organizations with good company culture know the importance of excellent leadership. Even with a committed workforce, if the company fails with leadership continuity and gets a bad leader, the productivity and performance of employees can suffer. 

If you look at the characteristics of top companies, you’ll notice a recurring theme which is having excellent leadership and an engaged workforce. While having a healthy company culture is ideal, here are the characteristics of an organization with poor company culture:

  • Poor employee productivity
  • High absenteeism
  • High employee turnover rates
  • Disengaged employees
  • Poor work-life balance
  • Employees open for accepting new job opportunities

It’s not too hard to see how and why organizations with poor company cultures find it hard to thrive. 

In this article, we’ll share with you studies and statistics that show just how beneficial it can be to have and be in an organization with a health company culture. We’ll also share data that shows the gravity of having a bad company culture. 

Engaged and More Productive Workforce

According to Zenefits, “company culture is linked to employee productivity”. There are a lot of studies that support this statement. In a survey conducted conducted by The Alternative Board (TAB), 86% of the respondents mentioned that company culture has a direct impact on productivity. 

Moreover, company culture also impacts engagement which is a major determinant of employee productivity. According to Gallup, just 13% of the workforce is highly engaged. This means most of the workforce population is disengaged. 

This also means that you get a competitive edge over others if you have a healthy company culture as it promotes engagement. Moreover, disengaged employees have a detrimental effect on organizations. 

A study by Gallup showed that actively disengaged workers are costing U.S. companies $483 to $605 billion each year due to loss in productivity. Here are the benefits of having an engaged workforce:

  1. More motivated workers
  2. Healthier employees
  3. Lower absenteeism
  4. Lower turnover 
  5. Fewer job mistakes
  6. Fewer accidents
  7. Higher customer satisfaction
  8. Greater profitability

When employees are engaged, they are more willing to stay longer at work and to perform at their best. Here are more statistics on employee engagement:

  1. A highly engaged workforce shows 21% greater profitability – Gallup
  2. 89% of employees in organizations that promote initiatives for well-being are more likely to recommend their company as a great place to work – the American Psychological Association
  3. Just 46% of companies reported that they are prepared to take on the challenge on engagement – Deloitte

Another study by Forbes showed that companies with strong company cultures experienced a 400% boost in earnings. 

More Effective Leadership and Better Reputation

Leaders face a lot of challenges for their company to prosper. They need to be able to empower the workforce for them to be productive, engaged and committed. This can be harder to do in a setting wherein a poor or toxic culture is in place. 

In a stressful environment, workers can become less creative, less productive and their health can be deteriorating with constant exposure to work stress. Moreover, there can be issues with trust, happiness and satisfaction.

All of these factors can make it harder for a leader to create significant progress for the company. With a healthy company culture, employees can be more willing to be cooperative and are more likely to be engaged. 

Company culture is crucial to recruitment and retention. According to Hays, 43% of workers who are looking for a new job have company culture for their main reason. Having a good company culture can be a competitive edge in the war for people. 

How to Form a Healthy Company Culture

The secret to developing a positive and healthy company culture is to become employee-oriented. Give more value to your employees. Offer them the right employee benefits, promote work-life balance and recognize their efforts.

Through this, you gain their trust and commitment. By caring for the health and well-being of your employees, you help them become more engaged, productive and creative.

According to Health Shield, 57% of workers mentioned that if their employer proactively supported their wellbeing, it can help them become more loyal, more productive and take less time off of work.

Remember that company culture affects all corners of the organization. By working hard to develop a healthy company culture, you improve the overall quality of your workforce, company brand and you also generate more revenue.

Developing and sustaining a positive company culture can be hard but it’s harder to stick with a culture that doesn’t satisfy the workforce and doesn’t move the organization forward. Begin today to create a healthy company culture.