Is Your Workplace Toxic? It can cost you Millions of Dollars

We’ve all heard the joke on the Internet that if someone puts in their job listing that “we’ll treat you like family,” you should run away — that’s the last thing a company would do. To be completely transparent, I once consulted a friend of mine who worked with a company that said this, and they had a very high rate of income.

Employees at this company call and send Slack messages every hour of the day. The manager expected employees to be available 24/7 even though the company itself was working a regular 9 to 5 hour. The manager would hold a team meeting every month where he would call everyone in the team to tell them what they had done for the month – in front of everyone. Achievements are never accepted in these group meetings.

On the other hand, my friend also worked with a different company whose employees absolutely loved the work culture. If you made a mistake, the business owner acknowledged it and helped you understand ways to improve in the future. There was never any punishment or scolding involved. He encouraged everyone to use it as a learning experience.

He also saw the power of people and actively spoke to them on other occasions. For example, he noted that one employee hired to answer the phone had an affinity for numbers and enjoyed spending money. With a lot of encouragement from the team and a little training, that receptionist moved up to inventory management.

All jokes and internet memes aside, the culture in your company can make or break your business.

Related: How to Create a Workplace Culture Where Everyone Feels Like They Belong

The cost of a bad company culture

According to the Society for Human Resource Management, it can take 6-9 months’ salary to find a replacement. That means losing a $60,000 employee could cost you up to $45,000 trying to find a replacement. To put this in perspective, that aforementioned company with a terrible work culture had an average acquisition time of six months for a team of 15 people. Let’s say they all earn $60,000. That means that every six months the company was burning $675,000 – totaling $1.35 million a year. As you can imagine, that company went out of business.

Of course, company culture is more than money. Morale, performance and finding top talent all affect a poor workplace. Without a positive outlook and recognition of success, employees feel like they can’t do anything right, which leads to low morale and, subsequently, innovation and low enthusiasm for work. If a person does not care about their work, they will not do it well, which leads to external problems for the company such as poor customer service and missed deadlines. And if a company cannot innovate in our fast changing world, the business will not survive.

This then leads to employment issues. Companies with a bad reputation will find it difficult to hire top talent because no one wants to work in an environment where they are not respected. According to an estimate published by Gettysburg College, the average person will spend 90,000 hours of their lifetime at work – that’s about one-third of a person’s life. People don’t want to spend that time in a place that stresses them out or pushes them over the edge. This includes current employees; people do not want to work in a place where they are always afraid of losing their job; therefore, many people (once they realize the toxicity of the workplace culture) will quit. This leads to a never-ending, vicious cycle of talent coming and going, leaving the business with no way to grow.

Related: 10 Great Examples of Inspiring Company Cultures

Create a culture that retains talent

There has been a change recently where people are not staying longer at work. You’ve probably heard of people who have worked at the same company for 50 years or more. Today, it is more common than not to hear of someone who has worked for multiple businesses in just a few years. This is due to the nature of the job, the benefits included and – you guessed it – the company culture. Having worked in the recruiting industry for nearly two decades, here are ways to create a company culture that will retain your top talent, save you money and help your business grow:

1. Be present. Too many people want to own companies without being there to run them. If you don’t want to work there, why would your employees want to work there?
2. Lead by example. Everyone is human, even artificial intelligence tools make mistakes. Use a mistake or problem as a learning curve, and you can even turn it into a marketing opportunity.
3. Empower employees. Give your employees opportunities to advance in their careers through training, certifications, etc. If someone wants to improve, help them!
4. Celebrate achievements. See success and create goals that lead your team to rewards.
5. Speak freely. If something goes wrong, it must be pointed out. Do it in a professional manner so that the team can deal with the problem.
6. Increase work life balance. Especially for remote workers, people are tied to their devices. Have them take breaks and holidays and set working hours that encourage this balance.
7. Offer incentives as part of the job package. Benefits play a big role in potential talent as well. Look at what your company has to offer to attract employees to join your workforce.

Related: How to Build a Work Culture That Can Survive Anything

If you’re not sure what to change about your workplace culture, go to the source and ask your employees. Their valuable feedback will help you create a culture that encourages employee retention and encourages top talent to grow the business.