What does your organization's culture say about you?

SquareSpace prides itself on down-to-earth leaders who listen to their teams and has become known as one of the best places to work in New York.

Google spends millions every year on its culture because they know being "Googly" is important. So important, in fact, that it's helped them become a leader in innovative ideas and online progress.

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REI employees are wholeheartedly dedicated to the ideals set forth by the company, lifting their culture to new heights. Employee turnover, while at 31% in 2013, is over 30% less than the average among retail chains.

You can't deny the power a strong company culture has, but it can work in some surprising ways.

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Why is Culture so Important?

Everyone is talking about company culture lately. It's a hot topic and for good reason. Your company's culture can make or break your business.

While it's not necessarily outlined in a charter or vision, your culture is always present. It's a generally unspoken way of doing things that's unique to your business. It's a set of fundamentals to guide your staff, and though an employee handbook can answer most questions, your culture is what they'll fall back on.

Still, culture is more than that. It's a manner for increasing productivity, making employees and customers happier, and building a team that wants to work together. Everything you do as a business influences, and is influenced by, your company's culture.

1. Poor Organizational Culture Means Death To Productivity

While this may be the least surprising, productivity is affected in some interesting ways. In fact, studies have found that happy employees are 12% more productive, while unhappy employees are 10% less productive. That's a huge difference when you're talking annual worth.

Poor culture means you're leaving your employees unsatisfied. Considering that most people spend more time at work in your office than they do sleeping in their own bed, you have to put forth more effort than you think to make it worth it.

There are tons of ways to increase productivity, and some will even lead to other benefits or entirely shift your company culture.

Forcing new systems isn't always the key. Sometimes your business only needs a small change for tremendous results.

2. Millennials Cherish the Experience More Than the Product

Millennials have finally taken over as the largest portion of the workforce and that means catering to a different audience within your business.

This socially connected generation is looking for a company they can stand behind because of their ideals, much more than the product they're offering. A study by Virgin Pulse found that 77% of participating Millennials thought that company culture is as or more important than salary and benefits.

Millennials are looking for an environment that's fun, challenging, and collaborative. The same study also found that Millennials appreciate a company that takes care of their employees and that leads to increased productivity and team retention.

As the Baby Boomers continue to retire and leave the workforce, it's important for businesses to understand the change in ideals. It can better your culture and save your business.

3. Culture Can Save You Money

While most understand that employee retention can be costly, they don't see the impact it can have on your office's culture.

The expected cost to train a manager for a $40,000 position is roughly $8,000. While that amount may be negligible to bigger businesses, the secondary effects it can have on the rest of your staff make it impossible to ignore.

That new employee may be motivated and ready to get to work, but their productivity level is only expected to match current staff in 1 to 2 years. That translates to a loss in revenue over that time, as well as more money to train them further.

Having a high turnover also affects your team as a whole. Individuals leaving will disengage from their work, an act that's contagious throughout the office. And when your employees aren't focused on their job, your customers will lose the exceptional service you're aiming for.

Part of your ability to retain employees is finding the right applicants that fit the business. Interviews need to do more than check the qualifications of the individual, they need to assess their integration to your culture. An employee who's goals, personality, or ideals don't line up with the whole is more likely to leave your business and will probably cause a few headaches along the way.

Develop a culture that values its employees, offers them room to grow internally, and keep them engaged, and you'll find retention climbing as fast as your productivity. Don't let your culture be the reason people want to leave your business.

4. A Culture of Giving Lets Everyone Leave Happy

The more you give to your employees, the more they're going to want to give back. This translates into better products and more sales for you company. Plus, customers are having their problems solved more efficiently and they're leaving happy as well.

Many businesses focus on keeping the customer happy but neglect their employees in the process. At the opposite end of the spectrum are companies that empower their employees to handle each customer however they deem necessary.

Southwest Airlines, for example, while in an industry notorious for poor service, gives their employees "permission" to make each customer's day great. They've figured out how to get the entire company on board with their vision through a great culture.

Zappos lists, "Deliver WOW Through Service," as one of their core values and sees 75% of purchases come from returning customers. Again, they've figured out how to keep their employees happy and eager to serve.

While figuring out what makes your business tick, pay attention to the customer data. Spotting brand loyalty could be a sign that you're doing it right—and you can thank your company's culture for it.

Creating Something Worthwhile

Your company culture isn't a written code of conduct, but it's how your business will become known by everyone. You need to focus on creating an enjoyable environment while fostering the right mentality for your unique business.

Neglecting to care about your culture is a death sentence. With a great company culture, you can increase productivity, employee and customer satisfaction, and save your business money. It's more than just a ticket to a better business, it's how your company will be remembered.

If you want more advice on how to improve you company's culture, check out these articles.

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chris-kang

About the author:

Chris is always in pursuit of optimal living, and believes strongly that although "alone you can walk fast, together we can walk far" :)