How to Fix a Company Culture Gone Wrong

6 min read
Dec 4, 2018

Despite efforts to grow your business, low morale, decreased productivity and high turnover have began to take hold. What could be the cause of this? If your company leadership takes a closer look, a breakdown in company culture is likely the cause.


Stylish brunette working from home in her home office-1

It may not seem like it, but company culture is one of the most influential components of a successful workplace - overall employee satisfaction with their environment and peers often outranks other factors in a decision to stay at a job or leave.

In fact, our “Employee Recognition and Appreciation” report found that peers are the biggest influencers in creating an engaging workplace. Recognition plays a key part in this. Employees that are well-recognized rate their coworkers 13 percent higher than less well-recognized coworkers, according to the report.

Surprising Effects of Employee Recognition

Here are some signs that your company culture may have gone awry, and some possible solutions for getting it back on track.

Problem: Lack of Trust in Leadership

As Forbes reports, “The key point is that business problems don't cause culture problems. Fear causes culture problems.” Culture is influenced directly by the leadership of an organization and the trust that they project onto other parts of the business. This manifests itself in two ways: fear or lack of trust in the leader themselves or their ability to lead the company.

Distrust in leadership and management is more common than you may think. A Harvard Business Review survey found that 58 percent of employees say they trust strangers more than their own boss. Employees may feel that leadership is not being fully open with them regarding company decisions, or perceive gaps in trust between members of an executive leadership team members. This can also include a perceived overconfidence in decisions or approaches to large-scale company decisions. Ultimately, this has a negative effect on company culture, as it causes employee resentment.

Distrust, however, can also be related to a perceived lack of confidence in leadership. If an employee perceives that leadership are not sure of themselves in relation to large-scale company decisions, they will likely feel a sense of insecurity about their role and the company at-large. This uncertainty inevitably becomes a company culture issue as employees discuss their concerns with their peers.

Solution: Trust Starts at the Top

As the problems above suggest, trust starts with the image that leadership projects to the rest of the company. By establishing a focus on confidence, trust, and an openness to feedback, leadership can have a key role in turning around company culture.

Ensure that your executive leadership maintain visibility to employees, and that the interaction and trust among each other is apparent. This can be achieved with strategic internal communications usage, such as a monthly or quarterly blog post from leadership, leadership updates in a monthly staff e-newsletter, or a quarterly webinar for staff.

Problem: Lack of Transparency and Responsibility

Rideshare giant Uber made headlines in early 2017 as some former employees and investors opened up about culture toxicity at the company. Fast Company reports that one of the biggest factors that exacerbated this toxicity was the company’s lack of transparency. Two prominent investors in the company came forward and voiced disapproval when Uber chose only to include insiders in a task force charged with investigating sexual harassment allegations, according to the article. How companies address these situations sets the tone for how employees, as well as the outside world, view the transparency of a company’s culture and leadership. 

With transparency also comes responsibility, or the idea that every employee - regardless of their level in the organization - is accountable for their actions and has the independence to make decisions relating to their work. Company cultures who lack this frequently have issues with micromanagement. This, in turn, leads to lags in productivity because employees feel that they cannot make decisions about their work on their own, or that their work needs constant changes because of an overbearing supervisor.

 Solution: Open Leadership and Accountability

Leadership can enforce a culture of transparency by hosting frequent town hall meetings with employees. These provide an open, in-person forum to keep staff abreast of any company-wide changes while also addressing their questions or concerns. When addressing large-scale problems or allegations, consider partnership with outside consultants or other organizations to analyze your culture and propose changes.

Young creative business people at office

With regards to responsibility, ensure that upper and middle management are giving staff the flexibility they need to complete their projects with a balance of creative freedom and informed oversight. Your company should foster a culture of innovation. Rather than being resistant to change, consider an adaptive response to new ideas instead. This will ensure that your culture adapts with the times, and that your staff feel empowered to be a part of it.

Problem: Lack of Communication and Recognition

Gaps in communication and recognition can be extremely detrimental to company culture. According to Forbes, studies have shown that 79 percent of people who quit their jobs cite a “lack of appreciation” as their reason for leaving. This is especially true in employee-supervisor relationships. If an employee is unhappy with their supervisor, often times their peers are the first people they will complain to, creating low morale.

Gaps in communication can make the employee feel as though they have no ownership over the work that they do. Similarly to the micromanagement concerns above, if there is no “two-way” flow of communication, an employee may feel as though they have no freedom to give their supervisor feedback. A gap in communication or process can also make an employee feel unclear about achieving project milestones.

Solution: Check-ins and Celebrations

When implemented effectively, appreciation can have positive results for company culture and staff retention as a whole. Our “Surprising Effects of Employee Recognition and Appreciation” report found that well-recognized employees rate their enthusiasm for reapplying for their job 32 percent higher than workers who aren’t well-recognized.

As I wrote about previously, recognition has many touchpoints with other parts of workplace culture. But implementation of staff appreciation must feel authentic in order for it to work. Consider the implementation of digital platforms that allow coworkers to recognize each other for workplace successes, small or large. This open recognition also helps transparency.

 Also ensure that your culture prioritizes support. Team members should feel as though they can bring problems to leadership and be heard without risk of retaliation. Managers and leadership should also be engaged with providing solutions to these problems, rather than relying on the employee to figure it out themselves.

Problem: Lack of Human Resources Presence

An ineffective HR department can affect companies, regardless of their size and leadership structure. In the Uber example above, Forbes writes that “company culture crises are often the product of many small failures. Human resources is important in order to keep things in check.” The employee who reported the sexual harassment allegations claimed that despite reporting the incident, Uber’s HR and upper management did not feel comfortable addressing the allegations with the person involved beyond giving them a warning.

Solution: Build an Assertive HR Department

Employees should feel comfortable bringing issues to HR, especially those as serious as sexual harassment. HR needs to be assertive in its dedication to company policies, regardless of what level in the company they effect. This provides a more proactive environment for addressing company culture, as employees may not wait until their exit review to give criticism of the company or their managers.

Harvard Business Review also writes that waiting until an exit review to receive employee feedback may be a missed opportunity for HR departments. Rather than waiting for valued employees to leave, the article urges HR representatives to consider entry interviews, or a series of discussions throughout an employee’s first few months on the job to gauge their passions and also ensure that they feel engaged in their role.

Problem: A Disconnect in Company Values

According to one study, 33 percent of employees don’t believe their company’s core values align with their personal values. As I wrote previously, intrinsic fulfillment and connection to company values are very important in an employee’s satisfaction with their role and the company’s culture at-large.

But just having values isn’t enough. These values should be meaningful and attainable. In the Uber example above, Forbes writes that part of the company’s cultural downfall was its “vague” company values. The article says that Uber included statements like “always be hustlin’” - phrases that appear meaningless or condone “what is considered appropriate conduct open to potentially poor personal judgment.”

Solution: Create Meaningful Values and Stick to Them

Similarly to staff appreciation, company values should feel authentic to the focus or mission of your organization. This makes them more attainable and also more inspirational as principles that staff can identify with.

Also focus on the implementation of these values into company culture. As Glassdoor writes, companies often approach culture as “a series of events” rather than relating it to the company’s deeper values. Don’t view company culture as just social events. Consider team-building activities or volunteering that may have a deeper significance with your company’s values.






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