5 Tips on Leveraging Your Company Culture to Boost Employee Retention

The culture you create and foster in your business is a key driver of employee satisfaction and retention, arguably even more so than salary and benefits packages. While compensation is important, today’s workers have become increasingly particularly regarding the environments in which they are willing to work for the long term. This trend reflects more than a simple desire for work-life balance, but is rather more indicative of the prioritization of personal wellbeing in the workplace. Really, who doesn’t want to be happy and satisfied at work?

Even in volatile job markets, today’s talent pool is almost unwavering in their desire to work in positive environments for employers who value culture. And the result is that they are happier, perform better, and stay on the job longer.

Here are a few remarkable statistics regarding company culture and employee retention:

• A study by MIT Sloan Management Review reports that toxic corporate culture is the top predictor of employee turnover and that a positive culture is 10 times more important than compensation. Salary didn’t even make the top five predictors. (Culture Partners)
• A 2022 survey found that 77% of respondents assess a company's culture before applying and 56% prioritize culture over salary. (City Personnel)
• Employees who rate their organization's culture as "good" or "excellent" are 790% more likely to feel satisfied at work and 83% less likely to actively seek new employment. (SHRM)

What Business Leaders Get Wrong About Company Culture

If building a thriving company culture was easy, every business would have one. Many leaders fool themselves into believing that their organization’s culture is positive and productive, when that is simply not the case. This misalignment often stems from leadership’s superficial understanding and commitment to culture or the failure to recognize the current culture for what it is (or, as importantly, what it is not).

So let's talk a little bit about what does not necessarily translate into a thriving company culture.

Culture Is Not Just About Fun and Games. Plying your team with free snacks, open game rooms, and casual Fridays might generate a few smiles and contribute to morale, but a thriving company culture needs to connect with and support the team at a deeper level. A strong company culture is bolstered by opportunities, innovation, and dedication to the overall wellbeing of your team members.

Culture Shouldn’t Be a PR Tool. Commitment to important causes is admirable and can be strong contributor to a positive culture. But it is essential that the support is sincere and that it is reflected in your operations and leadership throughout the organization. If you are a company that states it values include sustainability and environmentalism, but organizationally you lack recycle programs and or other green best practices, that is a big disconnect that will likely alienate your employees and negatively impact your culture. 

Actions Speak Louder Than Words. Simply listing your core values and describing your culture in the Employee Handbook isn’t enough. It is essential that business leaders and managers model these values every day. Those who fail to lead in accordance with the company’s values and culture undermine the trust and respect employees have for them individually and for the business as a whole. In other words, do more than label your culture, live it.

Purpose Beats Perks Every Time. As mentioned earlier, while shuffleboard in the courtyard might be fun and provide employees the opportunity to socialize and maybe blow of some steam, there is more inherent value in embracing innovation, engagement, and a commitment to a greater good. And it's even better when leadership can connect all the dots by providing opportunities for both connection and purpose.

But enough about getting culture wrong. Let’s talk about getting it right and creating a workplace in which employees are happy, thriving, and committed to the long-term success of the business.

5 Ways to Elevate Company Culture and Boost Employee Retention

1. Build Trust & Transparency

Employees desire to be treated as trusted members of the team. They want their voices to heard and be included at some level in the business’s decisions and direction. Building trust also means giving your team a level of autonomy and not smothering them with micromanagement. As a business leader, make a commitment to being as forthcoming as possible with your team and watch how it affects their performance, job satisfaction, and ultimately your company culture.

2. Offer Paths for Career Growth & Leadership Development

A top reason people quit their jobs is the lack of growth pathways and potential for promotions within the business. Employees want opportunities to develop in their careers and grow into leaders. Make sure every employee understands their prospects for advancement and what they need to do to set those wheels in motion. Provide mentorship opportunities, skills workshops, and leadership development programs to keep employees motivated to improve, invested in their future, and committed to the long-term goals of the company.

3. Encourage Personal Wellbeing & Work-Life Balance

Employee burnout can flatline an otherwise flourishing company culture very quickly. Exhaustion breeds negativity, poor performance, and misalignment. On the other hand, a culture that respects personal time, wellbeing, and work-life balance leads to greater job satisfaction, better performance, and a substantially more positive work environment. Urge your employees to mind their personal wellbeing and promote a culture of self-care. If you can, offer flexible schedules, work from home or hybrid options, and a satisfactory amount of PTO.

4. Recognize Contributions & Reward Achievements

Everyone wants to feel that their performance and contributions matter. But recognition shouldn’t only be given when a deal is closed or a new client is landed. Yes, it is critical that you reward employee milestones like surpassing goals or being named a top performer, but it is also important to recognize others whose contributions may not land a deal, but support the business in other ways. Make recognition a central component in your approach to leadership whether through bonuses, shout-outs, or even a simple thank you. Gratitude shines a bright, positive light on the entire organization.

5. Cultivate a Culture of Respect & Collaboration

As a business leader, be the model of respect that you expect from everyone in your organization. Your team looks to you to set the tone for acceptable interactions, conflict resolution, and constructive communication. Embrace fairness and diplomacy as core values. Encourage teamwork and reward successful collaboration, both at the individual and interdepartmental levels. Identify work silos that threaten to thwart collaborative efforts and implement strategies that bridge the gaps, foster communication, and align teams to shared goals. Then watch your culture flourish.

Take some time to reflect on your company’s culture and ask yourself if your  employees feel valued, supported, and motivated to grow. Or better yet, ask them. If their answer is yes, you are already onto something great. Otherwise, you have critical work ahead of you. The good news? Investing time and effort into building a stronger culture doesn’t just improve the wellbeing and retention of your employees, it also helps create a more resilient, innovative, and successful business that is poised for longevity.