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3.4 Cases and Problems

Chapter summary.

• Diversity is the real or perceived differences between individuals. Diversity can include race, gender, sexual orientation, size, cultural background, and many other differences. Multiculturalism is similar to diversity but focuses on the development of a greater understanding of how power in society can be unequal because of race, gender, sexual orientation, power, and privilege.
• Power and privilege is a system of advantages based on one’s race, gender, and sexual orientation. This system can often be invisible (to those who have it), which results in one race or gender having unequal power in the workplace. Of course, this unequal power results in unfairness, which may be a legal concern.
• Diversity is important to the success of organizations. Many studies have shown a direct link between the amount of diversity in a workplace and the success of the company.
• Oftentimes there are cultural aspects to an organization that make it resistant to an inclusive environment. These are often not obvious, but awareness of how your own company culture impacts multiculturalism is important. Job announcements, testing, and pay differences are company culture components that can create exclusive environments.
• In recruitment, awareness of how and where you post announcements is crucial. Development of a set pay scale can alleviate some of the issues surrounding unfair pay, especially between men and women.
• Formal mentorship programs can create multicultural understanding and ensure people do not stick with their own race or gender when helping someone move up the ranks in an organization.
• The Equal Employment Opportunity Commission (EEOC) is a federal agency charged with development and enforcement of laws relating to multiculturalism and diversity in the workplace.
• The EEOC covers discrimination based on several areas. Companies cannot discriminate based on age—that is, against someone who is forty or older. They also can’t discriminate against people with disabilities or on the basis of race, genetic information, national origin, gender, or religion.
• Retaliation is also illegal, based on EEOC laws. An organization cannot retaliate against anyone who has filed a complaint with the EEOC or a discrimination lawsuit.
• The US Department of Labor oversees some aspects of EEOC laws, such as the Family and Medical Leave Act (FMLA) . This act requires organizations to give twelve weeks of unpaid leave in the event of an adoption, birth, or caregiving of sick family members.

Chapter Case

But…It’s Our Company Culture!

You are the HR manager for a fifty-person firm that specializes in the development and marketing of plastics technologies. When you were hired, you felt the company had little idea what you should be paid and just made up a number, which you were able to negotiate to a slightly higher salary. While you have been on the job for three months, you have noticed a few concerning things in the area of multiculturalism, besides the way your salary was offered. The following are some of those items:

• You know that some of the sales team, including the sales manager, get together once a month to have drinks at a strip club.
• A Hispanic worker left the organization, and in his exit interview, he complained of not seeing a path toward promotion.
• The only room available for breast-feeding mothers is the women’s restroom.
• The organization has a policy of offering $200 to any employee who refers a friend, as long as the friend is hired and stays at least six months.
• The manufacturing floor has an English-only policy.
• You have heard managers refer to those wearing turbans in a derogatory way.

What do you think needs to be done to create a more inclusive environment, without losing the culture of the company? What suggestions would you make to those involved in each of the situations?

Team Activity

• In groups, research recent high-profile cases involving diversity or multiculturalism. Prepare a five-minute presentation on the case to present to classmates.

Human Resource Management Copyright © 2016 by University of Minnesota is licensed under a Creative Commons Attribution-NonCommercial-ShareAlike 4.0 International License , except where otherwise noted.

10.3 Chapter Summary and Case

Chapter summary.

• Diversity is the real or perceived differences between individuals. Diversity can include race, gender, sexual orientation, size, cultural background, and many other differences. Multiculturalism is similar to diversity but focuses on the development of a greater understanding of how power in society can be unequal because of race, gender, sexual orientation, power, and privilege.
• Power and privilege is a system of advantages based on one’s race, gender, and sexual orientation. This system can often be invisible (to those who have it), which results in one race or gender having unequal power in the workplace. Of course, this unequal power results in unfairness, which may be a legal concern.
• Diversity is important to the success of organizations. Many studies have shown a direct link between the amount of diversity in a workplace and the success of the company.
• The Equal Employment Opportunity Commission (EEOC) is a federal agency charged with development and enforcement of laws relating to multiculturalism and diversity in the workplace.
• The EEOC covers discrimination based on several areas. Companies cannot discriminate based on age—that is, against someone who is forty or older. They also can’t discriminate against people with disabilities or on the basis of race, genetic information, national origin, gender, or religion.
• Retaliation is also illegal, based on EEOC laws. An organization cannot retaliate against anyone who has filed a complaint with the EEOC or a discrimination lawsuit.
• The US Department of Labor oversees some aspects of EEOC laws, such as the Family and Medical Leave Act (FMLA) . This act requires organizations to give twelve weeks of unpaid leave in the event of an adoption, birth, or caregiving of sick family members.

Chapter Case

But…It’s Our Company Culture!

You are the manager for a fifty-person firm that specializes in the development and marketing of plastics technologies. When you were hired, you felt the company had little idea what you should be paid and just made up a number, which you were able to negotiate to a slightly higher salary. While you have been on the job for three months, you have noticed a few concerning things in the area of multiculturalism, besides the way your salary was offered. The following are some of those items:

• You know that some of the sales team, including the sales manager, get together once a month to have drinks at a strip club.
• A Hispanic worker left the organization, and in his exit interview, he complained of not seeing a path toward promotion.
• The only room available for breast-feeding mothers is the women’s restroom.
• The organization has a policy of offering $200 to any employee who refers a friend, as long as the friend is hired and stays at least six months.
• The manufacturing floor has an English-only policy.
• You have heard managers refer to those wearing turbans in a derogatory way.

What do you think needs to be done to create a more inclusive environment without losing the culture of the company? What suggestions would you make to those involved in each of the situations?

The Business Case for Company Culture

• December 2, 2020

Strong company culture has become a major selling point — right up there with salary and healthcare benefits — for companies looking to recruit the best and brightest talent. But what exactly is company culture? Contrary to popular belief, company culture is not simply defined by quarterly happy hours and office snacks. Rather, company culture relates to the ways in which employees think and act on a daily basis.

While Microsoft, Zoom, and HubSpot are infamous for their high-performing company cultures, many companies outside of the tech world are stepping up to the plate. Novelis, the world’s largest producer of flat-rolled aluminum, received significant praise for its commitment to operational excellence through culture management.

“You can never overestimate the impact a strong culture has on an organization,” said HR (Shashi) Shashikant, Senior Vice President & Chief Human Resources Officer. “If you are genuine and use every means at your disposal to reach and engage your workforce toward specific business goals, the results are astounding.”

[newsletter_module]

The numbers prove it: companies that effectively manage their culture have 63% more successful product launches and their employees are 90% more likely to recommend their organization as a great place to work. These companies also deliver nearly 20% higher returns to shareholders relative to comparable companies over a five-year period.

But reaching results isn’t the only advantage of culture management. Here are five additional benefits leaders reap when they intentionally cultivate their culture:

1. Strategic Clarity

A company’s organizational goals, or Key Results , define what they hope to achieve. But to successfully achieve the “what,” employees need to understand the “how.” This is the culture component.

Culture and strategy work in tandem to provide employees with a clear roadmap of expectations. By pairing three to five meaningful, measurable, and memorable organizational goals with four to five supporting cultural beliefs , leaders ensure employees understand exactly how they are expected to think and act to reach results.

Without cultural beliefs, employees continue old patterns of thinking and behavior that don’t align with top priorities. On the flip side, without highly targeted, strategic goals, cultural beliefs are like a boat without an anchor — there’s nothing to tie them to. It takes both culture and strategy to succeed.

Case Study: Petronas

PETRONAS, a Malaysian oil and gas corporation, was founded in 1974 as a small, 15-person company with big dreams. Today, the company employs more than 53,000 people working in 80 countries and across multiple business pipelines, including accounting, engineering, retail, oil fieldwork, and beyond.

While differences in location and job description abound, there’s one thing every PETRONAS employee has in common: a shared commitment to the PETRONAS company culture.

Accomplishing this unified culture wasn’t always easy. When Tan Sri Wan Zulkiflee Wan Ariffin was appointed CEO of PETRONAS in April 2015, oil prices had been plunging steadily for nearly a year. Wan Zulkiflee knew that to survive in the market, his company would need both clear strategic direction and a cultural transformation to execute it.

Wan Zulkiflee worked diligently with his team to identify highly targeted key business results surrounding shareholder value, stakeholder knowledge, transparent procurement procedures, and the growth of professional relationships. Once strategic clarity was established, he introduced six cultural beliefs to anchor and rally the company towards achieving their organizational goals:

• Results Matter: I stretch my limits to deliver superior results.
• Own It: I own the results and don’t blame others.
• Focused Execution: I plan, commit, and deliver with discipline.
• Nurture Trust: I always keep my promise and build mutual trust.
• Tell Me: I seek, give, and act positively on feedback.
• Shared Success: I collaborate for the greater good of PETRONAS.

This strategic and cultural clarity charted a course forward for the company, helping them rise above the economic downturn.

“The upside of a crisis is that you are compelled to do whatever is necessary to ride out the tough times. This includes taking a hard look at your organizational culture . Is it one that helps you weather the storm, or does it need to be strengthened?” said Wan Zulkiflee in a recent interview. “Culture plays a critical part in bringing strategy to life. It’s the foundation that sustains all of our change initiatives.”

2. Top-to-Bottom Alignment

Working in silos can be extremely beneficial for a workforce, allowing employees to become experts in a specific task and take pride in their work and ownership over moving the needle in a specific area. But there’s also a downside to this type of structure. Rather than looking at the big picture — the overall success of the company — siloed teams end up with a very narrow frame of focus. They are unable to keep pace with desired organization-wide results.

According to the Culture Accountability Index, only 36% of employees believe that individuals within their organization are aligned around a common set of cultural beliefs. What’s more, only 31% of individuals deeply understand how their work connects to their company’s strategic goals. Without a sense of alignment and purpose, business results can quickly slip through the cracks.

Culture management gurus don’t just describe what the strategic goals are and how employees should think and act to accomplish them, they also explain why it all matters. This instills a sense of purpose in employees and leads to greater alignment among even the most siloed teams. In fact, employees at companies that intentionally cultivate their company culture are 76% better at working together across the organization to quickly and efficiently handle new projects.

Case Study: Richland Community College

A few years back at Richland Community College, cross-functional collaboration was hard to come by. Departments operated in silos, rarely communicating with one another, while faculty and staff remained strictly divided. The only thing uniting all parties was confusion over the institution’s overarching goals.

This lack of alignment led to an absence of good, productive conversation. It also didn’t bode well for the health of the institution as a whole — the student retention rate had dropped to 46.24% for the following term and 8.46% for the full fall-to-fall calendar year. It was time for a significant culture shift.

For Richland Community College, that meant rallying all employees behind a single, unifying set of goals:

• Trust: Develop a mutually respectful and empowering work environment based on trust, individual and shared accountability.
• Grow: Grow institutional enrollments by 7% in 3 years.
• Thrive: Establish and maintain fiscal viability and sustainability.

Leaders at the college explained that every department would have to step up to the plate and work together if they wanted to see these goals realized. One department could not survive if the others failed — the health of the entire college was on the line.

Culture champions were appointed within each department to nurture inter-office relationships and conduct routine check-ins and team-building activities. As connections and trust strengthened, the teams stopped viewing one another as unique entities, but rather as part of one, united body. They understood what they needed to accomplish, how they were expected to get there, and why it all mattered.

It wasn’t long before goals that once seemed impossible started falling into place. Retention for the next term increased by 41% while fall-to-fall retention increased by 370%.

3. Personal Accountability

Individuals often externalize the need for change, and it’s easy to see why — it can be uncomfortable to take accountability and closely examine the issues right in front of us. But it can also be empowering. According to The New York Times bestseller, The Oz Principle , accountability is a “personal choice to rise above one’s circumstances and demonstrate the ownership necessary for achieving desired results.”

In organizations with effective company culture, employees are astutely aware of their organization’s top priorities, why they matter, and how they play a part in accomplishing them. As such, they are empowered to take greater accountability when challenges arise. In fact, companies with strong workplace cultures see 53% more personal investment in achieving organizational Key Results among employees.

Accountability-driven employees embody the Steps To Accountability (See It, Own It, Solve It, Do It) that promote ownership and propel change. For example, an accountable employee in a warehouse setting is one who sees that a machine is broken, takes ownership over the problem, develops a solution, and then puts that solution into place. They don’t say, “not my problem,” and wait for someone else to intervene, but rather do what’s needed to fix the issue.

Case Study: McElroy Manufacturing

McElroy Manufacturing is a family-owned business dedicated to providing the highest quality fin tube and pipe fusion products. Founded in Tulsa, Oklahoma, the company has grown from a small-town enterprise to a globally recognized brand.

Due to the nature of the high-hazard industry in which employees at McElroy work, safety has always been a top priority. When one of McElroy’s initial OSHA inspections identified over 40 serious safety hazards, members of the leadership team knew something had to change. They developed Lean into Safety , which is less of a program and more of a comprehensive cultural mindset.

“The culture of safety at McElroy is integrated into everything that we do. […] Because we put such a big focus on it, employees hold each other accountable,” said Barry Calogero, Vice President of Operations at McElroy. “If an employee sees something that doesn’t seem safe, they have an obligation and a responsibility to say something and they try to get it fixed right away. They don’t say that it’s management’s responsibility — they take ownership of it.”

McElroy employees are given 30 minutes a day to clean their workstations and make short safety and improvement videos using their phones. Several of these videos are then shared at the company-wide meeting each morning, ensuring all employees are aware of a dangerous situation or a new safety best practice that has been identified.

4. Employee Engagement

Accountable employees take ownership for driving their own improvement. They proactively seek feedback, adjust performance, and deliver better results. As such, accountable employees are also engaged employees . They feel a sense of purpose in their work and understand how they play a part in the overall success of their company.

According to the Culture Advantage Index, organizations in the top quartile of accountability have 28% higher rates of employee engagement and 31% more growth potential. To bring this data to light, let’s look at Novelis, the company introduced at the beginning of this paper.

For several years, Novelis had been posting dismal financial performance, pursuing conflicting priorities, working in uncommunicative silos, and suffering from a lack of accountability for results. To make matters worse, despite several years of unprecedented investment totaling more than $2 billion, the company had still failed to produce a favorable return on invested capital.

CEO Steve Fisher knew something had to change — the survival of the business depended on it. At the company’s Global Leadership Summit, Fisher said “There is a blue ocean of opportunity in front of us. However, as a company, I’ve become convinced we will drown in that ocean if the people in this room don’t change. Accountability must be our vehicle for change.”

“Accelerating change by getting accountability right, C-suite to the front line,” became the company’s primary propeller for growth. Under Fisher’s leadership, the senior team at Novelis led and achieved an astonishing transformation by getting people to take greater accountability for their results. As employees gained a renewed sense of direction and purpose, employee engagement scores rose to historic levels, return on capital employed nearly tripled, and profitability increased by 26%.

5. Organizational Agility

Nearly 72% of executives believe their business model will be under threat within the next five years. As high as that is, that data predates the disruption of 2020. It’s no wonder “agility” has become a buzzword among leaders seeking to navigate the rapid pace of change in the marketplace and the slew demands spurred by emerging technologies, a global pandemic, and a total upheaval to way of life.

As business strategies adapt and align around disruption, so must company cultures. An organizational mindset that is flexible, forward-thinking, and resilient is crucial. Just look at the mindsets behind the CEOs of companies like McDonald’s, Netflix, and Microsoft — all three have led organizational culture shifts designed to facilitate innovation.

Microsoft in particular has earned a reputation for developing a growth mindset , in which challenges are viewed not as threats, but as opportunities to go above and beyond. For Microsoft CEO Satya Nadella, that means asking himself how successful new products are, how effective the company is at adapting to change, and what kind of culture is in place at any given moment to facilitate the company’s success. He encourages employees to ask themselves these questions regularly, refusing to settle for the “status quo” and constantly striving for new opportunities to learn and grow.

In a letter to his employees , Nadella wrote, “Our industry does not respect tradition — it only respects innovation. This is a critical time for the industry and for Microsoft. Make no mistake, we are headed for greater places — as technology evolves and we evolve with and ahead of it.”

Reaping the Benefits of Effective Company Culture

While each of the benefits listed in this paper — strategic clarity, top-to-bottom alignment, personal accountability, employee engagement, and organizational agility — is unique, they are also all related. Together, they form the basis of effective culture management and put companies on the path to sustainable success.

In companies that get their culture right, employees are 73% more enthusiastic about going to work and 69% more willing to navigate changing situations. They are proud of their companies and proud of themselves for the role they play in attaining organizational goals. But while studies prove that strong company culture is crucial for success, so do our clients.

After undergoing a significant culture shift that united more than 950 employees across 27 branches, leaders at Redstone Federal Credit Union were met with the fruits of their labor — 55% growth in annual non-interest income and 1,052% increase in loans. They also increased their monetary donations to local communities by 1,600% and increased members’ average annual cashback rebates by 7,251%. Their efforts had paid off.

“We’ve created a culture that’s going to ensure the success of this cooperative and its community for generations to come,” said Redstone CEO Joe Newberry. “It’s the culture that will propel us, and we can promise that no matter what happens in the future, Redstone will be here for its members.”

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Empowering employees to experiment and grow

How culture change and training initiatives have helped insurance company UNIQA start a movement.

Call for change

Accelerating a culture change

UNIQA Insurance Group, established in 1811 and one of the largest insurance companies in Central and Eastern Europe today, knew that attracting and retaining top talent was a critical step to becoming a market-leading service provider.

The company wanted to enable its people to react quickly, learn from mistakes and collaborate beyond conventional boundaries.

To do this, UNIQA established a Culture Office to lead internal cultural change. Using its UNIQA 3.0 strategy as a base, the company prioritized four guiding principles in its transformation: customer, ownership, community and simplicity.

When tech meets human ingenuity

Sparking new beliefs with stories

UNIQA and Accenture developed an unconventional approach to encourage employees to try new things and learn from failure. The Culture Office began piloting culture-change initiatives in which employees could address and solve everyday challenges through storytelling and small experiments.

A "Train the Trainer" program built the capability and confidence of employees to train others. Participants then led 15 cohorts of up to 12 experiment leads to kick-start their own experimentation and storytelling journeys with their teams.

These "micro" experiments—which would eventually number in the hundreds, if not thousands—then laddered up to cultural change in service of UNIQA’s strategic ambitions.

As we spoke to potential partners to help us on our culture journey, Accenture’s capabilities to create an innovative approach to culture transformation truly stood out.

Jacqueline Go / Head of UNIQA’s Culture Office

A valuable difference

The art and impact of storytelling

In mere months, the initiatives had a positive impact on UNIQA’s culture. Participants designed and tested more than 150 behavioral experiments, while UNIQA’s people conducted over 3,000 hours of coaching and workshops during which experiment leads received intensive training to ultimately empower colleagues.

Based on the encouraging feedback from participants, the Culture Office plans to conduct additional training sessions to accredit more leaders.

Employees are now better equipped to face everyday challenges, take ownership and collaborate. Using the art of storytelling, employees share with their colleagues their experiences of risk-taking and innovation—to turn culture change into a real movement.

We were energized about the prospect of doing something different.

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Company Culture Is Everyone’s Responsibility

• Denise Lee Yohn

A top-down approach doesn’t work anymore.

A top down approach to building company culture no longer works for several reasons. For one, Covid-19 has upended how leaders interact with employees and how coworkers connect with each other. Next, company culture has grown in importance, thanks to recent high-profile crises at big name companies. A new culture-building approach is already in place at some organizations, one in which everyone in the organization is responsible for it. Importantly, this model doesn’t relegate culture-building to an amorphous concept that everyone influences but no one leads or is accountable for. And it weaves in perspectives from employees to customers, from middle managers to the CEO.

Here’s how organizational culture might have been handled in the past: The CEO commissions the Human Resources department to produce an effective company culture. HR designs a campaign to tout a mission statement and core values that the CEO and senior management developed. HR also implements some employee perks like free snacks in the break room or monthly birthday celebrations. Maybe they also field an annual employee engagement survey and report results back to the CEO. And then with their culture-building to-do lists completed, the CEO and HR move on to other priorities.

• Denise Lee Yohn is a leading authority on positioning great brands and building exceptional organizations, and has 25 years of experience working with world-class brands including Sony and Frito-Lay. Denise is a consultant, speaker, and author of What Great Brands Do: The Seven Brand-Building Principles that Separate the Best from the Rest and the new book FUSION: How Integrating Brand and Culture Powers the World’s Greatest Companies .   

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Case study: creating a company culture that reflects your values

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We chat with Matt Collins, MD at Platypus Digital. He talks about the inspiration behind his business, its company culture, and how HR is at the heart of this.

“The desire to make a positive difference to the world is baked into their DNA .” This is how Matt Collins, founder of Platypus Digital , describes his employees. “Our team is everything that’s good about our agency.”

Platypus is a charity marketing agency delivering positive change. It connects charities to the people they need, like donors, fundraisers and service users.

With a ten-year career in the charity sector under his belt, Matt launched the business in 2014. He explains, “I had seen how charity clients were typically treated by agencies. They were often pushed to the bottom of the pile in comparison to corporate clients. I wanted to create a business focused solely on charities that delivered positive change through digital marketing.”

Fast forward seven years and Matt now employs a team of 10 (soon to be 11) plus a bank of freelancers and partners. “I have built a team of people whose values reflect those of our clients.”

HR Strategy

A progressive HR strategy has grown the team and developed the company culture according to Matt, “The first step for us was identifying our workplace values. I used to think these were created by managers about the team they wished they had. But I’ve changed my tune. If done properly, they can help you decide what to look for in new team members and help them to progress.”

Platypus employees were instrumental in shaping its company values. “I had created and imposed the previous set. So how could we claim them as our values? We invited staff to a workshop and asked them to describe the current culture. They imagined a new starter and what advice they would give them about how to do things at Platypus.”

They decided on the following core values:

Make a positive difference.

Constantly improve., communicate openly., support each other..

So how do these work in practice? With initiatives like an anti-racism workshop hosted by JMB Consulting last year. It has helped the team to understand ways in which they can continuously improve. “One of those ways was influencing the charities and agencies we work with to pool our shared learnings.”

Over the past three years, Bespoke HR has worked with Matt to help develop this culture. This has involved creating individual policies to fit with the company values. “I have appreciated the expertise and ongoing advice I’ve received on best-practice from the team.”

The company’s HR policies are constantly evolving. These currently include policies on menopause, periods and gender identity. “Even if we don’t need to use a particular policy right at this moment, it gives us peace of mind that we’ve planned ahead.”  Staff are also involved in this process. “For example, we recently introduced a ‘Get home safely’ policy. This was prompted by a discussion in our weekly meeting about women’s safety and the wider national campaign.”

All policies are accessible and avoid unnecessary jargon. All written copy goes through the Hemingway App to make it as clear and accessible as possible.

Staff benefits

But it’s not all about policies. Staff benefits play a large part in helping to attract and keep people. Current offerings include:

• Flexible working/working from home, part-time, flexitime and job sharing.
• 43 days holiday (including UK bank holidays).
• Quarterly profit share scheme.
• A £2,000 training budget per team member.
• A yearly £1,000 donation to a charity of choice, matched monthly donations of up to £20 per month.
• 10% of staff hours used pro bono for a charity of their choice.
• A paid five-week sabbatical after five years of service, and every five years after that.

“It’s a crowded marketplace,” he acknowledges. “We know that we need to stand out to attract good people, we also want to keep these people and reward them for their hard work. Our benefits are reviewed regularly and respond to the changing environment. The last year has been a test of our remote and flexible working approach – and we have adapted accordingly.”

“At the moment, the team receives a monthly wellbeing allowance to help with the isolation and stress of working from home. They spend this on things like exercise equipment and gym memberships, candles and flowers for their homes or nice meals. We also contribute to the increased household bills that come from transporting the office to their homes.”

As a result, staff retention is high. With an industry average of around 17%, Platypus has seen less than 10% turnover in the last three years. “This is something I’m proud of,” says Matt. “If people do move on, I want them to remember us as being a great place to work.”

Recruitment process

So how do the values filter through to the recruitment process? A gender decoder helps assess all job descriptions and adverts. An anonymous recruitment process aims to avoid bias. Candidates are shortlisted and hired on ability, not experience.

The Platypus team worked on the below process, which Bespoke helped to implement:

• Applicants complete an online application form.
• Personal information is removed by a third party.
• The anonymous list is then shared with Platypus.
• Shortlisted candidates are contacted to arrange interviews (with flexible slots available).
• The interview starts with a time-limited test for the candidate to work through alone.
• Interview questions test main skill ability. These are scored individually by the panel (which includes a Bespoke HR consultant).
• After the interview, the panel gathers the completed sheets and calculates scores.
• The successful candidate is offered the role.

Advert placement is also a key consideration. The team often uses networks for communities that wouldn’t access the ‘traditional’ sites like The Guardian. “Sites like Tech Returners for example reach people returning to work after an absence. This can help parents and those who have had ill health,” Matt explains.

What else would he advise on diversity? “Actively seek out opportunities to talk to different people. We were as guilty as the next person of relying on friends and friends of friends to find people in the past. We are now committed to widening our reach as an agency so we’re not just an echo chamber. It’s a work in progress and is not always perfect we know. Sometimes candidates accidentally identify themselves during the process. But it’s something we’re constantly refining.”

So, what’s next? Platypus is in the process of becoming a registered B Corp. It has also recently published an impact report analysing its contribution to society. “We will continue to refine our HR strategy to reflect the conditions around us,” Matt concludes. “Ultimately, we want Platypus Digital to be a great place to work. We work with charities because we want to make a difference in the world. To do great work, we need a happy and fulfilled team.”

Tips for a fair recruitment process

• Build up your network before the vacancy arises.
• Reach out to people on LinkedIn whose skills match those you are looking for and encourage them to apply.
• Give your recruitment agency a specific brief (especially if you’re trying to reach a group that wouldn’t usually apply).
• Ask a third party to review your Q & A process to reduce cultural bias.
• Show the salary and don’t set academic restrictions on the role.
• Share questions with the candidate ahead of the interview. Structure these around skills and values.
• Pay people for their time if there are specific tests of their skills.
• Create a structured scoring system.
• Discuss everything post-interview with a third party/facilitator to avoid bias.

Platypus’ recommended tools and resources

• Hemingway App
• Gender decoder
• Fearless Futures guide to anonymous recruiting
• The Equal Group
• Collaborative Future

For more information on Platypus Digital, please visit: www.platypusdigital.com

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Zappos: A Case Study into Company Culture 

July 17, 2024

Matt Gainsford

Today, we are diving deep into the enigma that is Zappos, a company whose work culture is practically legendary and has become the yardstick by which success is measured. So, what is their secret sauce? Let's break it down.  

Company culture. It is a term that has been on the lips of every hiring manager and business leader. For many companies, it is a major selling point and something designed to wow potential candidates into joining them. 

The key to building a happy workplace is to create a thriving culture. But what does it mean, how is it quantified, and why has it become so satirized?  

From pizza parties and ping-pong tables to unlimited PTO policies and chances to get involved in altruistic service projects, a great culture can mean many things to many people.   

At Titus Talent, we think we know what it takes to build culture, and for those of you reading this, you might see many similarities between us and the company we will focus on.  

If you are reading this and unfamiliar with who we are, you will likely recognize the subject of our cultural exploration. Today, we are diving deep into the enigma that is Zappos, a company whose work culture is practically legendary and has become the yardstick by which success is measured. So, what is their secret sauce? Let’s break it down.  

Who are Zappos and Why Focus on Them?  

Zappos, an online shoe and clothing retailer founded in 1999, is renowned for its exceptional customer service and innovative corporate culture. Their model has influenced thousands of businesses through numerous case studies and management programs. Zappos empowers customer service representatives to make decisions that best serve customers, often exceeding standard service expectations. They adopted holacracy, a management philosophy replacing the traditional hierarchy with a flat, team-based structure, promoting flexibility, autonomy, and employee empowerment. Operating under ten core values like “Deliver WOW Through Service” and “Create Fun and A Little Weirdness,” Zappos integrates these principles into hiring, training, and daily operations, ensuring a vibrant culture. 

We are focusing on Zappos as a case study in culture because their approach to customer service and employee empowerment sets a benchmark for organizational excellence. Their innovative practices provide valuable insights into building a strong, adaptable company culture. 

Customer Service: The Heartbeat of Zappos  

Zappos did not just put customer service on the map—they redefined it. From day one, their mission was clear: to deliver happiness. It was not just a marketing tagline; it was a core value they lived and breathed. Happiness within (employees) leads to happiness experienced (customers) policies (which are now the norm for many companies, thanks to Zappos) like free shipping and returns, a 365-day return policy, and 24/7 customer support were not just strategic moves. They were expressions of Zappos’ deep-seated belief in putting the customer first. It is a principle woven into the fabric of the company and a big part of why they have been so influential.  

Holacracy: Breaking Down the Hierarchy  

Now, this is where Zappos gets interesting. In 2013, they adopted holacracy—a radical, self-managing system that threw traditional hierarchies out the window. Imagine a company with no rigid job titles, and everyone can take initiative. It is not without its challenges, but this structure fosters an environment of flexibility and autonomy. Employees were empowered to make decisions, innovate, and drive change without the usual bureaucratic red tape. It was a game-changer for Zappos, pushing them to the forefront of organizational innovation. 

Core Values: The DNA of Zappos  

At Zappos, core values are not just words on a wall—they are part of the company’s DNA. They have ten core values, including gems like “Deliver WOW Through Service” and “Create Fun and A Little Weirdness.” These values are exemplified every day. They shape the behavior, decisions, and culture at Zappos. You can feel it when you walk into their offices. There is a palpable energy and alignment from everyone pulling in the same direction. 

Employee Happiness: The Zappos Way  

Tony Hsieh, the late CEO of Zappos, firmly believed that happy employees lead to happy customers. Zappos invests heavily in creating an engaging and fun work environment. We are talking about themed office spaces, wild parties, wellness programs, and continuous learning opportunities. This is not just about perks—it is about creating a workplace where people genuinely love to be. The result? High levels of job satisfaction, loyalty, and productivity that any company would envy. 

Training and Development: Building a Strong Foundation  

Zappos’ commitment to training and development is another cornerstone of their culture. New hires go through an intense four-week training program where they learn about the company’s culture, values, and customer service ethos. It is not just onboarding; it is an immersion into the Zappos way of life. By investing in their people from day one, Zappos ensures that everyone is set up for success and fully integrated into the company culture. 

This dedication to training is backed by compelling data: companies with strong onboarding processes see a 70% improvement in new hire productivity and an 82% boost in retention. Furthermore, organizations that invest in comprehensive training programs report 218% higher income per employee and 24% higher profit margins. It is no wonder that 94% of employees would stay at a company longer if it invested in their career development. By prioritizing training and development, Zappos enhances individual growth and drives organizational success and longevity. 

Transparency: Open and Honest Communication  

Transparent communication is a big deal at Zappos. They believe in sharing information openly, whether it is about the company’s performance, goals, or challenges. This level of transparency builds trust and fosters a collaborative environment where everyone feels informed and involved. Companies with high transparency are more likely to retain 94% of their employees, whereas a lack of transparency can lead to mistrust and a disengaged workforce. It is a refreshing approach that many companies could learn from. 

Creativity and Innovation: Encouraging Bold Ideas  

Zappos champions creativity and innovation. They encourage their employees to think outside the box and are not afraid of failure. This culture of experimentation has led to some incredible ideas and improvements over the years. By giving their team the freedom to innovate, Zappos stays ahead of the curve in a fiercely competitive industry. 

Diversity of thought is crucial for fostering a culture of creativity. It takes an environment where different perspectives are welcomed and actively sought out. This diversity prevents groupthink, which can be dangerous as it leads to uniformity inthinking and stifles innovation. To cultivate this environment, leaders must be mindful of the weight their words carry.When leaders are unaware of their influence, they can unintentionally stifle the ideas of less senior employees, preventing valuable contributions from emerging. Companies that embrace diverse perspectives and encourage open communication are 3.5 times more likely to outperform their peers in generating innovative ideas. Zappos’ inclusive culture ensures that all voices are heard, promoting a dynamic and innovative workplace where creativity thrives. 

The Wrap Up  

So, why has Zappos’ work culture been so influential and esteemed? It is a combination of putting customer service at the core, embracing innovative structures like holacracy, living their core values, focusing on employee happiness, investing in training and development, promoting transparency, and encouraging creativity and innovation. Zappos has shown us that when you prioritize culture, you create a powerful foundation for success. At Titus, we share a similar approach to that of Zappos and believe the “People First” term is a potent reminder of how to develop culture, as opposed to a hollow value used to virtue signal to potential Partners and future employees.  

Building a culture takes time, and a successful culture is entirely dependent on the foundations laid and the commitment to living them out. Zappos has been something of a lighthouse in this arena and is worth exploring if you are exploring the creation of your company culture. If you are serious about developing your company culture, recovering from layoffs, or counting the cost of how your hiring strategy affects your growth strategy, check out our talent optimization opportunities. 

Learning & Development  

At Titus Talent, we have talent optimization services specifically designed with culture, leadership, and growth in mind.We believe that hiring great people is the starting point, but to truly thrive, people need continuous growth and development. Our TO experts empower leaders to enhance their people strategies, driving performance and satisfaction within their teams. For our customers, this means working with an organization that is not only invested in attracting top talent but also committed to nurturing and developing that talent, ultimately leading to higher productivity, innovation, and long-term success. Learn more here: https://www.titustalent.com/talent-strategies/talent-optimization/

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Articulating & Enhancing a Corporate Culture

Client Profile & Challenge

When the leaders of SCA, a Swedish hygiene and forest products company, decided to split their organization into 2 different corporations, they knew they needed help articulating and defining the culture of Essity, the corporation that would take SCA’s hygiene and health division.

SCA had already initiated a project with us to articulate, strengthen, and further capitalize on its culture. Now that effort transitioned to a more urgent goal: Define the culture for Essity that would retain the best elements of SCA’s established corporate culture, but would also include new beliefs and behaviors to give Essity a competitive advantage.

The challenge was to articulate a culture that could become a pillar for Essity’s strategic plan as the company prepared to go public and face larger established global competitors.

To make the new culture stick, it would need buy-in from all levels of the company — the executive team and associates at every level in multiple geographic markets.

And with the spin-off and IPO looming, the process had to be completed in a short period of time.

Solution & Results

A few months before the IPO, we partnered with Essity executives to begin working through our 6-step process towards organizational culture change:

• Ask strategic questions. We worked with company leaders to identify what the new competitive environment would require.
• Grow from the bottom up.  Essity gathered input from 8 focus groups involving hundreds of employees from several countries and functions to identify common themes and concerns about the old company culture, and see what they thought was important for future success.
• Elicit executive input.  We interviewed 13 senior Essity executives to gather their thoughts on what the company’s culture should and shouldn’t do, ensuring alignment between staff input and the executive team’s strategic perspective.
• Decide on the final articulation of core company values.  The 2 beliefs — care and collaboration — were hallmarks of the legacy SCA culture. In addition, 2 new beliefs, commitment and courage, were chosen based on a consensus for the new company’s success.
• Obtain executive team buy-in.  Essity and CCL held a workshop for the executive team to think through the new beliefs and behaviors and explore how to help the business units start living them in order to bring the new company culture to life.
• Roll out the new culture broadly.  The new beliefs and behaviors were rolled out across the company 3 months after Essity’s IPO. Because they resonated so strongly companywide, acceptance was immediate. Essity leaders quickly integrated the beliefs and behaviors into company hiring, promotion, and recognition practices. And the company shared its new culture with shareholders, suppliers, and customers.

Top company leaders have made it a priority to embrace and model the new culture by:

• Practicing new values and behaviors as individuals and as a team,
• Creating a culture of transparency,
• Defining what “good” looks like, and
• Communicating values through storytelling and anecdotes.

Participants Say

“New beliefs gave us the possibility of having a common ground where we could start to talk and start to see ‘How are we fitting together?’ … It’s easy to connect the beliefs and behaviors to our daily reality.”

Massimo Minaudo

Commercial Director, Essity’s Italian Business

“Everybody in this company should have a relationship to the beliefs and behaviors. … Our senior leaders now talk about the beliefs and behaviors as an integrated part of how we are doing business.”

Karin Nyström

Vice President, Human Resources Development

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According to Indeed.com , corporate culture is defined as, “….an organization’s values, ethics, vision, behaviors and work environment. It is what makes each company unique, and it impacts everything from public image to employee engagement and retention.”

While this concept is not new, it was recognized around 2015 as shifting from an organic, naturally occurring aspect to a now purposefully created and cultivated component.

Influences & Impact

The influencers of company culture can be, but not limited to, values, behaviors, attitudes, motivators, national cultures and traditions, economic and industry trends, company size, and products. Much like individuals, these components craft unique personalities for each business.

The impact company culture has on the success of an organization is quantifiable. An abundance of research has shown that positivity and happiness absolutely benefit a business.

“Not only does a positive workplace culture help attract and retain employees , but it also has a direct impact on a company’s success. Research shows that employees who love their jobs are more productive and invested in the company’s success,” comments Rebekah Harney , Partner/Chief Business Development Officer at LBMC.

Additional advantages are employee retention, better hiring choices, higher performance quality, employee pride and value, and a favorable company reputation.

Core Components

The most important workplace culture commonalities found in successful companies often boil down to nuances of the following core items:

• Communication . Open, two-way communications within all levels of the organization keeps negative feelings from festering and conflicts from remaining unresolved. Honest, clear, and courteous discussion advances growth, trust, and value. This includes recognition for individual and company wins.
• Opportunities for Growth. Companies that invest in their employees via development and training, plus the opportunity for professional and financial advancement, tend to remain with a company longer. People desire to feel they are bettering themselves and progressing in their profession.
• A Clear Vision and Mission. It is imperative that every employee understands why their organization exists and what it hopes to achieve. Providing inspiration and understanding in this overarching statement drives purpose and responsibilities from the company level all the way through to individuals.
• Leadership . The best companies don’t just say they value their employees; they show it. This is initiated from the top down by leadership. Strong leaders empower and listen to their employees. They create community cultures through qualities such as concern, care, trustworthiness, appreciation, communication, operational excellence, encouragement, and inspiration.
• Teamwork . A culture of collaboration promotes more efficient task completion and boosts performance and morale. As every individual in an organization is moving towards the same goal; championing unity and camaraderie should be encouraged. Through good communication, team outings, and off-sites, many genuine friendships are forged and help to reinforce positive team and company experiences.
• Good Values – In addition to a Missions Statement, every company also needs a Values Statement stating its core values, professional standards, and behavioral mindsets. This serves as a code of conduct for the company to achieve its goals and should be woven into every activity, decision, and interaction. Values often given high importance include respect, trust, equity, innovation, collaboration, accountability, recognition, integrity, and communication.

Company cultures are continually evolving and a work in progress since social/cultural norms change, companies grow or downsize, products/services ebb and flow, and the economy shifts. To achieve the six components above, sometimes it’s necessary to throw the whole pot of spaghetti at the wall and see what sticks. It also helps to be flexible enough to pivot often, if necessary.

A Feedback Foundation

The most successful way to gauge your company’s culture is by creating a trusted feedback foundation. It doesn’t happen overnight, but by fostering an open, communicative atmosphere through consistent meetings, performance reviews, open-door policies, and conversations, an environment of honesty and good health will develop. These discussions and feedback requests make employees feel heard and part of the improvement process.

Survey Says

An incredibly useful format for gathering employee thoughts and feedback is the employee survey. Different types of surveys – anonymous, multiple choice, open-answer – provide different results and have a variety of specific purposes. Ultimately, an anonymous, open-answer version provides the most genuine answers.

How a company decides to use the information it receives back is up to them, but it is good to remember that when it comes to negative feedback, consider it an opportunity for change. And responses of any kind shows that employees are invested in their work and the company. However, no negative feedback whatsoever is cause for concern. This implies employees do not feel comfortable sharing their thoughts and/or are feeling detached from the organization.

Stratis – A Real World Example

Recently, Stratis Industries , a small, growing manufacturing company situated in rural Wisconsin, polled their employees on a variety of topics, including the six components above. The survey was open-answer and anonymous.

When working with any number of people and personalities, it isn’t always possible to please everyone, but the returned results showed strong, positive themes across the core categories and an encouraging level of trust and feedback that allowed employees to be very honest in their responses. These employees care about their jobs and their company.

Stratis takes the health of their corporate culture very seriously , hence the survey. This information will allow them to continue to promote the positives and look at any constructive criticism as improvement opportunities.

Stratis Survey Says

A sampling of the feedback:

On Communication

The company’s communication style garnered words and phrases like:

• “Good and fair”
• “Direct and easy-to-understand”
• “A little broken”
• “Dynamic and persuasive”
• “Communication is usually assertive and clear. We do struggle with email communication and people returning emails. I think it is getting better though.”

On Growth & Opportunities

• “Best of any company I have worked at so far. My manager as well as the General Manager took immediate interest in my training. Both personal and professional.”
• “There seems to be a lot of opportunities to people who want to learn”
• “You can grow however you need to take initiative and ask”
• “Opportunities are present, but not always obvious”
• “There are many potential career opportunities”
• “One-on-one training; hands-on”
• “Training is not the best. I feel all the leads need to be up-to-date and trained better before being thrown to the wolves.”

On Leadership

Words used to describe leadership strengths:

• “Hardworking”
• “Knowledgeable”
• “Relationship-building”
• “Flexibility”
• “Situation awareness”
• “Open-minded”
• “Problem-solving”
• “Determination”
• “Easily relatable”
• “[They] know when you need someone to talk to”
• “I don’t really see leadership too often”
• “The owners genuinely care for their employees”

On Teamwork

• “When we are working as a team, you can see the difference. Projects go smoother, everyone feels a bit more energized, we break company records for shipping goals, and there is a certain sense of community at the end of the day. We are all a bit tired at the end of the month, however everyone has a smile on their face.”
• “I've noticed that everyone seems to work well together and if help is needed somewhere someone will pitch in”
• “This is changing for the good”
• “It is essential, and it is very glaring when it does not happen.”
• “Vital. With the rate we are expected to grow we need to have overlap in people’s abilities while maintaining a healthy workflow.”
• “There are many steps from an order to getting it out the door. Each person has a role in that happening and doing it as a team and with a good attitude is very important.”

On Good Values

Words and phrases pertaining to the good values within the company:

• “Respecting each other”
• “Straight forward – no B.S.”
• “Independence”
• “Helping everyone”
• “Rewarding”
• “Motivating”
• “Appreciation: team lunches, pats on the back, personal acknowledgements”
• “I'm fairly new but am enjoying the work and comradery already”
• “People should be encouraged to do better and have a good time at work”

On a Clear Vision & Mission

• “Making a great product”
• “Quality products”
• “Seeing the end product and happy customers”
• “Producing and selling a product made in our local community”
• “The nice stuff going out the door.”
• “Admiration of products, and some sense of accomplishments”

Other Comments on Pride, Accomplishment, and Enjoyment

• “I'm detail-oriented, do precise work, do my best to prevent mistakes and increase productivity. [I’m proud of] getting an order out the door in-time or early.”
• “[I’m proud of] becoming a lead, helping everyone learn and advance in their roles”
• “Engineering Grand Slam: I really put my heart and soul into the project. It made me very happy that the project was error-free. This took a load off the Production Team.…the customer was very satisfied with the project.”
• “I like that I feel important and needed”
• “Cool peeps here”
• “[I enjoy] operating the CNC machine; everyday challenges grow my skills and knowledge”
• “I do enjoy working for Stratis and love my job. I do however wish there were more recognition for people….and less chaos.”
• “[I enjoy] problem-solving with successful results.”
• “[I enjoy] learning new things, seeing what our capabilities are and the end-product going out the door.”
• “I think this is a great place to work”
• “I just appreciate the small company, caring ownership, and management.  They are looking to get the job done and looking for growth but always care about you and how you are doing, feeling, etc.”
• “I am very happy I found this place!”

All this information is a golden opportunity for Stratis to take their company to the next level. As Limeade, an immersive employee well-being company, noted, “While it’s not always easy to receive negative feedback, you can’t expect to improve without it. By regularly soliciting your employees’ feedback, being honest about the good and the bad, and taking proactive steps to enact the best ideas, you’ll go a long way toward strengthening your company and improving engagement. That’s the ticket to a spectacularly happy and productive workforce.” And already armed with many positive characteristics, Stratis is well on their way!

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How To Make the Case for Company Culture to Leadership

Benefits of Company Culture ,  Changing company culture

Turn skepticism into conviction and ensure that your leadership not only understands the value of a great workplace culture but also becomes its strongest advocate.

Recently, I hosted a webinar on leadership behaviors that drive retention , and I was struck by the depth of curiosity and engagement from all of you. We unpacked some crucial data, but it left us with a big question: How do we get the folks upstairs — you know, the CEO, the Directors, and the management team — to buy into this? How do we convince them that investing in culture isn’t just another line item, but a game-changer for our organizations?

It reminds me of that old saying about leading a horse to water but not being able to make it drink. We’ve got all this great information on why a strong, positive culture is key to employee retention , but getting leadership to take that sip and really taste the benefits — well, that’s a different story.

It’s about shifting the perspective from seeing employees as just numbers or resources to recognizing them as the heart and soul of what makes our companies thrive.

Turning insights into action

They key is to show the leader not just the financial benefits, but also how culture aligns with their personal goals of being a respected leader.

First, I’d talk about the costs. For example, did you know it costs about $4,700 on average just to replace an employee? And that’s being conservative. That figure doesn’t even count the training costs or the dip in productivity when someone leaves. It’s a big deal for the bottom line.

Make the business case for culture

Then, I’d bring up how a happy and engaged team has been proven to drive the business forward . People work better when they feel valued and understood, which in turn boosts the company’s performance. I’d suggest using tools like the research-backed Great Place To Work Trust® Index™ Survey, which is designed to measure and improve on the specific elements of company culture that lead to business success.

Companies with standout cultures see fewer people leaving, meaning less money and time spent on hiring and training new staff. They also have engaged teams who are less likely to suffer from burnout , boosting productivity. In these environments, innovation isn’t just a buzzword — it’s a daily reality. And when the economy dips, these companies are the ones quick to recover.

Tap their desire to become a respected leader

But what really seals the deal: Leaders want to be remembered for the right reasons. So, I’d appeal to that intrinsic desire to be a respected and effective leader . Earning a certification like Great Place To Work Certification™ can be a huge badge of honor for them. It shows their peers that they’re doing right by their team, and that’s something to be proud of.

Certification also signals to investors that your company is more than just talk when it comes to ESG (environmental, social & governance) . According to a recent IBM study, 70% of employees find  sustainability programs make employers more appealing .

I’d also suggest starting small – maybe try these strategies in one team and see the results. It’s less risky that way and can demonstrate the tangible benefits.

Finally, it’s all about communication. Setting up a meeting, having open and honest discussions, and using confidential surveys like the Trust Index to get real feedback from employees can make a huge difference. It all starts with employee listening.

So, if you can combine the hard facts with that personal touch, you’ll be more successful at convincing leadership. Show them it’s not just good for business, but it’s also something that can make them a leader people will look up to.

Join the dots between culture and business outcomes

Ready to get granular on how your company’s culture is really doing? Our Trust Index Survey is your go-to tool. It gives you the data and insights to boost your team’s performance by enhancing your workplace culture. If you’re curious about how it all works and keen to see the kind of impact it can have on your business, let’s chat. Reach out to our team and let’s dive into how Great Place To Work can be your partner for building – and maintaining – a thriving, high-performance culture.

Claire Hastwell

As the Content Program Manager at Great Place To Work, Claire helps decode the psychology behind high-trust workplaces using Great Place To Work's extensive data repository on employee experience. Claire has co-authored noted reports such as "Women in the Workplace" and “The Power of Purpose at Work,” and contributed to Fortune with her profiles of the Best Workplaces™. Her latest report on employee retention strategies  draws on the experience of 1.3 million employees to give leaders strategic guidance on retaining their top people. 

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The Statistical Case for Company Culture [Infographic]

Note: Infographic is at the bottom of the post. “Culture” has been a buzzword in the corporate world for several years, but what does it mean and why is it important? Entrepreneur.com defines company culture as “a blend of the values, beliefs, taboos, symbols, rituals and myths all companies develop over time.”

In other words, company culture is the personality of an organization from the employee perspective, and includes the company’s mission, expectations, and work atmosphere. Whether it’s written down, symbolized in the business logo, or simply an unspoken but understood definition, culture determines a company’s environment.

An often-cited example of good company culture is Google . With an employee count of 47,756 it hardly qualifies as a mom and pop shop, and yet people who work there describe it as having a small-company feel where no one hesitates to “spike a volleyball across the net at a corporate officer.”

But the culture of a company is not just about whether you’re allowed to chuck balls at your boss—it’s also determined by what the company stands for and how it treats others. Google gives back to the community as well as to countries around the world in the form of financial aid, restoring public parks, and Googlers volunteering their time.

“ To win in the marketplace, you must first win in the workplace .”

– Doug Conant, Campbell Soup

BONUS: I’ve made a company culture cheat sheet that summarizes the key points and lists every link in this post for easy reference. Save it to read later or email to coworkers. Get the free bonus here.

The Link between Employee Happiness and Productivity

Statistics show that a company’s culture has a direct impact on employee turnover, which affects productivity, and therefore success. A Columbia University study shows that the likelihood of job turnover at an organization with high company culture is a mere 13.9 percent, whereas the probability of job turnover in low company cultures is 48.4 percent.

The reason for this is simple: unhappy employees don’t tend to do more than the minimum, great workers who don’t feel appreciated quit, and poor managers negatively affect workers and productivity. In Rob Markey’s Harvard Business Review blog post  “Transform Your Employees into Passionate Advocates” he states, “Loyal, passionate employees bring a company as much benefit as loyal, passionate customers. They stay longer, work harder, work more creatively, and find ways to go the extra mile. They bring you more great employees. And that spreads even more happiness — happiness for employees, for customers, and for shareholders.”

The Link Between Employee Happiness and Profit

Although you don’t have to be a math whiz to understand the correlation between happiness and productivity, it should interest you to know the Department of Economics at the University of Warwick found that happy workers are 12 percent more productive than the average worker, and unhappy workers are 10 percent less productive. In fact, unhappy employees cost American business over $300 billion each year. So it literally pays to make sure your employees are happy.

Statistics from New Century Financial Corporation indicate that employees who are actively engaged in their job, i.e. happy, produce better results. For instance, account executives at a banking company who were actively disengaged produced 28 percent less revenue than those who were engaged. On the other hand, companies with happy employees outperform the competition by 20 percent , earn 1.2-1.7 percent more than their peer firms, and are 2.1 percent above industry benchmarks . Happy workers are also more likely to solve difficult problems faster .

“ To make customers happy, we have to make sure our employees are happy first .”

The Current State of Employee Engagement

A joke that was told at an executive workshop on leadership sheds some humorous light on employee engagement : “A CEO was asked how many people work in his company: ‘About half of them,’ he responded.” Ensuring your workers’ happiness is not just some new age, hippy-dippy, feel-good notion; it translates directly to the success, financial and otherwise, of your business.

According to Tim Rutledge’s book Getting Engaged: The New Workplace Loyalty , an employee who is engaged actually cares about the company beyond his paycheck or the quality of coffee in the break room. These are the workers who are willing to make the extra effort, with or without being asked, to ensure that the job is done to perfection and, directly or indirectly, that the business succeeds.

A 142-country Gallup report on the “State of the Global Workplace” shows that 63 percent of employees are not engaged at work and 24 percent are actively disengaged, leaving a mere 13 percent of workers who are engaged in the work that they do. Another way of saying this is that 900 million employees are not engaged and 340 million are actively disengaged around the world. That’s a lot of online Sudoku being played.

More importantly, this means that the overwhelming majority of people working for you lack motivation and enthusiasm and are not performing at their full potential. This makes a fertile environment for negativity, and just as happiness is infectious (have you ever been able to suppress laughter when someone around you is in stitches?), so is unhappiness. Employee engagement goes beyond making your staff happy; it separates the great companies from the average ones.

“ Engagement is a renewable daily decision that is voluntarily given when the company has proven worthy of it .”

– Jason Lauritsen, Talent Anarchy

Negativity and the Bottom Line

Are you starting to see the picture? Unhappy employees are disengaged at work which leads to negative attitudes and low productivity, and ultimately affects your business’ bottom line.

In fact, low-level engagement within companies results in a 33 percent decrease in operating income and an 11 percent decrease in earnings growth, whereas companies with high-level engagement have a 19 percent increase in operating income and a 28 percent increase in earnings growth.

Your business can stand out from the crowd by making using of your greatest asset: your employees. Marketing Innovators makes it clear that satisfied employees equals satisfied customers, who then spend more on your service or product and provide free marketing via great word-of-mouth.

They say that money can’t buy you happiness, but according to the data, happiness sure can buy you money, so to speak.

The Staples of a Strong Company Culture

When you were in grade school and causing trouble the teacher would usually send you to the principal’s office. If the principal was able to invoke the right amount of fear into you, you’d return to class with your tail between your legs and throw yourself into the assignment to avoid being disciplined again. Your change of behavior probably lasted until the end of the week, if you were lucky, before the cycle started again.

This method of forcing people to do the work—and love it, by God!—isn’t effective for the long term because it doesn’t address the deeper issue: what is causing this person’s unhappiness?

The Energy Project joined forces with Harvard Business Review and found that when four basic needs were met, employees were happy. These core needs are physical, emotional, mental, and spiritual well-being. This means getting adequate rest, exercise and nutrition, feeling seen and valued at work, having the space and time to focus and think creatively, and experiencing a deeper sensation of being part of something worthwhile. Employers who treat their staff like robots rather than flesh and blood humans with all the emotions, requirements, and limitations that come with our species will wind up running them into the ground—and out the door.

When The Energy Project worked with Sony Pictures to address the problem of employee disengagement, the entertainment company made a change: instead of pushing their workers to perform better, they started fulfilling these four core needs. Despite the 2008 recession, Sony had its most profitable year that year.

“ Coming together is the beginning, keeping together is progress. Working together is success.”

– Henry Ford

Measuring Employee Engagement

Whether you’re a Fortune 500 company or a start-up, you can turn your company culture around and watch both enthusiasm and revenue skyrocket. But first you need to take the time to measure employee engagement. According to The Next Web , the information you gather will help you “predict, prevent, and improve everything from manager effectiveness to your churn rate.”

How do you do this? First and foremost, you must be open to observing and listening without getting defensive. Schedule weekly one-on-ones with each employee and give them a safe place to talk about what’s going on. Organize company outings like  RevZilla.com to promote camaraderie and get to know each other outside of the cubicle walls. And track employee absenteeism: unhappy employees take fifteen more sick days  each year than the average worker.

There are also a lot of great analytics tools to help you  measure engagement by collecting employee feedback : Apple uses the fairly new metric employee Net Promoter Score ( eNPS ), Atlassian uses the app MoodApp , and Single Grain uses the cloud-based survey platform TINYPulse . 15Five CEO David Hassell suggests these ten questions to ask your team every week, explaining that “answers become conversations about what is most essential and meaningful for the team and the company, and those conversations transform into action.”

“ Engaging the hearts, minds, and hands of talent is the most sustainable source of competitive advantage.”

– Greg Harris, Quantum Workplace

Finding the Perfect Fit

Before you even survey your employees or analyze the data from all those fancy metrics you’ve put into place, consider not only who you’re hiring, but how you’re hiring them.

Zappos conducts two sets of interviews, one with the hiring manager who focuses on resume and ability, and one with the HR team which evaluates whether the candidate fits in with their culture. They also offer all trainees $2,000 to quit after the first week of training because they want only those who absolutely love the company culture to stay.

Buffer has a 45-day trial period, called Buffer Bootcamp , to see if the company is a good fit for the employee. They liken it to the dating process, where each party gets to know each other before committing to a long-term relationship.

Chipotle uses a list of thirteen characteristics that every new hire must possess. They also started a restaurateur program for its employees, allowing hourly crew members to become managers. When selected, they get a one-time bonus and stock options, and an extra $10,000 each time they train a crew member to become a general manager.

Successful companies like The Walt Disney Company have strong values that are so essential to their way of life that the company name and company culture are practically the same thing. Disney requires specific work experience for landing a dream job with them: childhood dreams.

Southwest Airlines , a service leader, zeros in on behavior, not just the resume; when they fly candidates in for an interview, gate and flight crew report back on their attitude and how they behaved. You may be able to fake a good attitude in an interview, but your true colors come out when dealing with travel, large groups of people, and small spaces.

“ If you are lucky enough to be someone’s employer, then you have a moral obligation to make sure people look forward to coming to work in the morning.”

– John Mackey, Whole Foods Market

Company Culture Makes a Difference!

Beyond keeping employees happy so that they positively affect your revenue, having a great company culture can encourage solutions, inventions or innovations that might not have come to light in a more oppressive environment. When a worker feels valued and respects her organization, the productivity possibilities are endless.

3M implemented a program called  “15 Percent Time” which allows employees to use some of their paid work time to “chase rainbows and hatch their own ideas.” It was during this time that scientist Art Fry invented one of the most renowned products of all time, the Post-It Note.

Taking its cue from 3M, Google started its own  “20% Time” program which resulted in the creations of Gmail, Google Earth, and Google Talk, to name a few. Similarly,  Hewlett-Packard Labs gives its employees personal creative time during which new products have been created, such as clear bandages and optical films that reflect light which are both on the market.

“ No company, small or large, can win over the long run without energized employees who believe in the mission and understand how to achieve it.”

– Jack Welch, former General Electric CEO

It’s clear that there is an exceptionally strong case for company culture. When your organization’s culture is in alignment with your goals and you hire people who share your values and enthusiasm, you are paving the way to financial success and building an outstanding reputation.

So what are you doing for your company culture?

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The return to meaningful corporate culture: six guidelines.

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Brent Daub is a senior founding partner of Gilson Daub , a workers’ compensation, subrogation, longshore and general liability law firm.

From Amazon to Disney to Farmers Insurance, a swath of our country’s most recognizable employers are requiring their employees to return to work in the office. These growing mandates are facing significant resistance from employees and new studies show that it is often a company’s current corporate culture that is keeping people from wanting to come back in.

In a recent interview , KeyAnna Schmiedl, chief human experience officer at Workhuman, which recently published a Human Workplace Index survey , highlighted that the return-to-office process these days "may be less about commuting to the office and more about the office and culture employees are coming to." She also remarked how current job seekers champion "work-life balance, recognition and rewards, and company culture over where work gets done."

The reality is that many corporate cultures across America are fractured, whether the team is in-person, remote or hybrid. Attracting talent or getting the team excited about work needs to start with a systemic change to company culture beyond when and where employees work.

As a leader, it’s vital to remember that healthy cultures don’t happen by accident. They are the result of intentional design and cultivation. Culture is created around a company’s core values, and it’s protected by leaders who embody them.

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If you want to strengthen your company’s corporate culture, here are six guidelines to follow.

1. Carefully craft three to five core values.

Culture is highly defined by the company’s values. You must be intentional in this process since these values are the compass that points your organization true North. Take the necessary time to design the culture you want powered by values that are meaningful. I recommend you come up with no less than three and no more than five essential core values. Now refine those into something concise, powerful and memorable.

2. Make your values known and have your leadership model them.

Values aren’t helpful if nobody knows about them. Once you have identified core values, communicate them in everything you do and say—so much so that you should be able to ask anyone in the organization what the company’s values are.

If people don’t know them off the top of their heads, there’s more communication to be done. Also, values mean nothing without harmony between what leaders say and what leaders do. All levels of leadership must model the values, from the CEO to low-level supervisors and team leads.

3. Make values and culture the first criteria for all promotions.

Employees pay attention to who is getting promoted. Promotion is where we communicate that this is the kind of person we want to lead our teams and why. If you say collaboration and teamwork are core values but you promote the highest-performing, independent, selfish and disrespectful individualist, this sends a message about what culture you really want. Therefore, all decisions about promotions need to prioritize cultural fit.

4. Have values and culture appear in performance reviews.

If core values and company culture are truly priorities, they should be topics that get discussed in performance reviews as well. If you provide a score on sales goals, there should be a similar score for demonstrating the company’s values. I recommend you go one step further and implement regular manager coaching and feedback sessions to discuss values and culture.

5. Recognize and reward those who promote values and culture.

To demonstrate that you’re committed to your culture and core values, publically reward and recognize your culture champions. What you reward and recognize will be repeated. Do the people who get celebrated as employees of the month look like the culture you want? If not, like with promotions, you are sending a mixed message about what you really value.

For instance, if your employees of the month are always your top salespeople or highest billers, then you are communicating you value profits over people. If you recognize people who go out of their way to help others and are kind and responsive, you reinforce those values as part of the culture. Performance is important but culture is king. Attaching a bonus to core values is also another way to promote a healthy culture.

6. Discipline people who compromise values and culture.

Culture is also highly influenced by what an organization tolerates. If you are fully committed to your organizational values and culture, then disciplinary action for those who continue to undermine it must be something you are willing to do.

For example, would you be willing to correct your top performer by sitting down face to face and saying this? "At this organization, we value respect. The way you spoke to this younger associate was not in line with the company culture of communication. I am going to need to see a change in how you talk to people, and if your communication doesn’t improve, there is a disciplinary process that can result in eventual termination." Until leaders are willing to protect the team from those who undermine the core values, employees will always believe there are two cultures: The one we talk about and then reality.

Ultimately, while diligently upholding a value system and clear corporate culture may seem daunting, the good news is that the above steps can make it easier to craft a work environment that provides meaning, significance and purpose.

All in all, I encourage you to view working through the above process as an organizational road trip. Keep in mind that:

• Vision is the destination.

• Leadership is the GPS that sets the course to the destination.

• Values are the compass that points the way.

• Culture is the vehicle everyone rides in together.

Once mapped out, you’ll no doubt enjoy the journey to a much more fruitful corporate culture.

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Still from Cat Video Fest. Contributed/Cat Video Fest

Hello, August!

The dog days are summer are here, so let’s celebrate with the Cat Video Fest at Portland Museum of Art and Strand Theatre. Or head to the Maine Lobster Festival in Rockland. Those are just a few of the choices in this week’s events roundup .

Maine Lobster Festival, Wild Blueberry Weekend and Lyle Divinsky

Lily Philbrook, Kathleen Turner and Colin Anderson in the Ogunquit Playhouse production of “A Little Night Music.” Photo by Nile Scott Studios

Actress Kathleen Turner is one of the stars of “A Little Night Music” at Ogunquit Playhouse,  playing through Aug. 17. You’ll recognize her from her many film roles, including “Peggy Sue Got Married,” or maybe as Chandler Bing’s father in “Friends.” Here’s an interview with Turner, who unpacks how she got the role and how the show is going.

Actress Kathleen Turner, now performing in Ogunquit, on being in her first musical

Billy Corgan of The Smashing Pumpkins in Memphis, Tennessee in 2022. L Paul Mann/Shutterstock.com

There are still tickets left to see The Beach Boys at Snow Pond Center for the Arts in Sidney on Friday and the Smashing Pumpkins at Maine Savings Amphitheatre on Sunday. We’ve got details on these and dozens of other upcoming concerts .

See The Beach Boys or Smashing Pumpkins in Maine this weekend

Styx. Left to right Todd Sucherman, Lawrence Gowan, Chuck Panozzo, James “JY” Young, Tommy Shaw, Terry Gowan and Will Evankovich. Photo by Jason Powell

Two other notable shows are Jerry Harrison (Talking Heads) with Adrian Belew tonight in Portland and Styx with Foreigner on Saturday in Bangor. Here are interviews with Harrison and Lawrence Gowan from Styx. Tickets are still available for both shows.

Members of Talking Heads, Styx and Foreigner all perform in Maine this week

Twin Tin ice cream sandwich. Photo by Peggy Grodinsky

Sweeten up your weekend with a quintessential summer treat. The Twin Tin Ice Cream Sandwich combines ice cream from Twin Swirls with cookies from neighbor Tin Pan Bakery. Find them at the ice cream shop on Brighton Avenue in Portland.

Twin Tin Ice Cream Sandwich is the taste of summer

Hazy IPAs from Allagash, Fogtown and Rising Tide. Photo by Ben Lisle

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