As culture becomes more important to business leaders, we are finding an increasing number of studies which demonstrate what is intuitive to most. Specifically, the significance of culture on business performance is critical. Here is a snapshot of some of the evidence of why company culture matters:
- The cost of US turnover due to culture over 5 years is $223 billion. SHRM – September 2019
- Millennials who experience a great culture are 50 times more likely to stay. Great Places to Work study – September 2019
- Diane Gherson, Chief Human Resources Officer at IBM has been studying the relationship between employee engagement and revenue for over five years. What IBM has learned is that employee engagement explains two-thirds of their client experience scores. Increasing client satisfaction by 5 points on an account leads to an extra 20% in revenue, on average. There is a direct connection between employee engagement and profitability. Harvard Business Review, March 2018
- A study on corporate culture and performance found that companies who make culture a priority had 4 times higher revenue, 12 times higher stock price, 750 times higher net income that those that did not. John P Kotter and James L Hesket, Corporate Culture and Performance
- Organizations on Fortune’s Best Places to Work list realized annualized stock market returns twice its competition and half the turnover.
- A majority of employees, 51%, were “not engaged” and 17% were “actively disengaged” in 2014 per a Gallop poll on engagement. And … The poll showed that companies with engaged workers not only produce 147% higher earnings per share than the competition they also have significantly higher productivity, profitability, and customer ratings, less turnover and absenteeism, and fewer safety incidents.
- “A strong culture can help or hurt performance. Culture can account for up to half of the difference in operating profit between two organizations in the same business. Shaping a culture is one of the leader’s most important jobs; it can be ignored, but only for so long and at one’s peril. James Haskett of Harvard Business School, May 22, 2012
- When the C Suite was asked about preparing for their new role, 67% said understanding and measuring the company’s organizational culture was either very or extremely important. And part of the challenge posed is that many executives believe they don’t have accurate ways to measure or even describe it. McKinsey Global Survey on executive transitions April, 2015. Rajiv Chandran, Hortense de la Boutetiere, and Carolyn Dewar.
- 69% of survey respondents would not take a job with a company that has a bad reputation, even if they were unemployed. Glassdoor 2015
- 84% of employees would consider leaving their current job if offered another role with a company that had an excellent reputation – Allergis Group Services Study 2012
Conscious Culture Group® works with business leaders to understand the current state of culture and build the organization into a high performing one that allows employees to work at their best, enjoy their work and value the organization. We believe an intentional culture gains better results than a default culture.