Why a Great Place to Work Is Good For Business

Growth expert Kim Weiss outlines 4 critical steps to building a healthy culture.

Research has proven that “great places to work” significantly outperform the S&P 500. They have higher customer satisfaction rates, higher rates of revenue growth, and higher income growth rates. So, why isn’t every company investing in developing a healthy culture? The answer is that healthy cultures take time, commitment and investment. It’s becoming more and more clear, however, that such an investment drives results. Here are four of the most critical things to keep in mind when building a healthy work culture and the value that will be created over time.

It Starts at the Top

The commitment to a healthy culture has to be embraced by all C-level leaders. When I was CEO, the team member responsible for culture reported to me. We collaborated on almost all culture-related initiatives. The Leadership Team was also required to embrace all initiatives. This way, the entire company came to believe and trust that culture mattered to leadership. This led to greater employee engagement. With higher employee engagement, we had less than 5% annual (voluntary) turnover in our customer success team which contributed to a 95% average annual customer retention rate.

Be Clear on Your Purpose and Be True To It

To have the healthiest of cultures, employees need to understand both the organization’s purpose and their role in achieving it. One way to accomplish this is to directly tie company goals to the performance goals of every employee. The clear connection should be written directly into the performance expectation paperwork. For example, with a corporate goal that marketing should drive 15% of all qualified leads, one of our marketing managers had a performance expectation of developing and implementing a method for defining whether a lead was marketing-driven or sales-driven.

It is equally important that the Leadership Team stick to the corporate purpose. I have seen multiple companies chase revenue that’s not consistent with their mission. It’s difficult, confusing and not good for morale when the team sees the Leadership Team losing focus and supporting off-mission initiatives. Do what you say you’re going to do and you’ll be much more successful at garnering employee satisfaction.

Promote Transparent Communication Across the Organization

When employees believe their employers are transparent with them, they trust the organization more, engage more and stay motivated longer. As a CEO, I found it useful to outline key expectations around communication. One of the “Communication Rules” we used was this: as soon as a team member came to believe that a deadline was not going to be met, they were expected to immediately discuss the impact of not meeting the deadline with the individual they were the most accountable to for that deadline. Together, the employees would agree on the impact of not meeting the deadline, outline how they would deal with that impact and agree on a revised deadline. This type of communication was required at all organizational levels. This helped with accountability to all stakeholders and clarified that it was more important to be honest about progress than to ignore trouble.

Reward and recognize

It’s important to develop effective employee recognition programs. The best programs recognize that employees find different types of recognition meaningful — and cash compensation is not the only meaningful way to recognize employees. Immediate recognition is the most effective. If you delay until the next performance review, much of the impact could be lost. Develop and consistently utilize recognition initiatives for everyone on the team.

While these are critical elements of being a great place to work, there are many potential additions. The investment will be worth it. After all, ask yourself this: In today’s competitive environment, what aspect of a business provides a more sustainable competitive advantage than highly motivated, passionately committed employees?

Kimberly Weiss is an experienced entrepreneur and leader. Currently, she is Chief Growth Officer at Health Evolution. She has been the CEO of three growth-oriented organizations, and her companies have been awarded Best Place to Work Awards five times. She currently advises leaders of small and mid-size companies on organizational effectiveness and people strategies.