Why do Google and Zappos keep appearing on Fortune magazine’s “Best Companies” list? Organizational culture. These companies have invested in their employees to keep them engaged, and they’re reaping the benefits of increased financial return, innovation, and retention. When companies are willing to build a strong culture, then employees are more than willing to go the extra mile.
Money Buys HappinessCulture is an investment … Companies have to pay to play. Are you still asking if it’s worth it? Check out some of these stories from our recent Engagement Report:
- Fortune magazine’s annual list of “100 Best Companies to Work for in America” returned 14% per year on their stock, compared to 6% of the overall market
- The Workplace Fund offered up to 10.81% return, compared to a 3.97% return from the S&P Index during the height of the Great Recession
Companies that don’t place importance on culture perform worse than the ones that do. Simply put, a well-established culture creates a sense of community. Coworkers collaborate together to improve efficiency and productivity even through the toughest times, like the Great Recession.
What Else Is New?
Employees are looking for professional development in the workplace, especially millennials. Companies that make their employees’ career goals their own have the ability to spark creative ideas in their workers. A recent Gallup poll reveals this unexpected connection:
- 58% who said their organization is committed to strength-building said their employer encourages new ideas that defy conventional wisdom
Gallup’s research brings to light the relationship between employee engagement and innovation. If companies want to be industry leaders, they need to first cultivate a culture that allows employees to thrive.
Should I Stay Or Should I Go?
Whether someone’s been with a company for six months or six years, their departure negatively impacts an organization’s productivity. When managers are committed to maintaining a valued culture, their employees are going to follow suit. Try not to be too surprised by this survey’s results:
- Engaged employees are 87% less likely to leave
Here’s another way to put it: If a company had 100 people leave last year, they could have saved 87 of those employees if there was an engaging culture. Think about all the money that could have been saved on recruitment, hiring, and training by retaining those employees.
The benefits of a distinct organizational culture doesn’t just stop at employee happiness. If you want to increase financial returns, innovation, and retention, you need to invest in a company culture that revolves around its employees engagement.