The fact that an unhealthy organizational culture can negatively impact your business is a no-brainer. Whether it’s a toxic workplace or one that suffers from an excess of team conflict, ineffective decision-making, or a lack of personal accountability, the end result is likely to be the same. Business challenges are rarely solved, customers are unhappy, and your employees are likely to resign on the first given occasion.
It’s about time for corporate leaders to be honest regarding the real issues that keep them from thriving in their field. Spoiler alert: it’s not because a certain employee missed a deadline or arrived late two days in a row. You have to address the root of the issue, admit that you may have a cultural problem, and then find ways to fix it.
Without further ado, let’s have a look at five signs that you have an unhealthy organizational culture:
1. Involvement scarcity
According to Gallup’s latest report, 85% of employees are not engaged or even actively disengaged at work, which results in approximately $7 trillion in lost productivity. 18% are actively disengaged, while 67% are simply “not engaged,” which means they are not necessarily unproductive but utterly indifferent to your company. They complete their tasks, but they lack motivation, enthusiasm, and willingness to share new ideas.
If you’re reading this article, you’re probably dealing with a gut feeling that your most brilliant employees are simply not giving their best or are slowly decreasing in motivation. When they started, they were probably coming to work with a desire to make a difference, but they never felt appreciated or listened to enough to keep up the sentiment.
2. Ambiguous communication
If you feel like the communication in your company is lousy, people are running in circles, not knowing what to do next, collaboration is missing from the scene, and there’s tension between coworkers when their responsibilities collide – you are not the only one. A Gallup research showcases that only 13% of employees firmly declared that communication within their workspace is effective. Communication provides a window into an organization’s culture and impacts its every aspect.
The side effects of ineffective communication range far and wide: from low morale, mistrust, feelings of meaninglessness, and lack of accountability to blame-shifting, burnout, and inability to collaborate.
Typically, poorly-functioning communication is viewed as an individual problem, a trait of the least skilled at the art. However, we argue that organizational miscommunication can often be traced back to structural issues caused by ignoring the importance of these three factors: shared goals and values, healthy relationships, and trust.
When people share a common goal and values with their coworkers, they feel comfortable talking to them–and they are better able to judge whether or not they can trust a given individual or officials. In other words, for communication to flow freely both ways (instead of being one-way), there needs to be some overlap between these three dimensions.
3. Low trust levels
Corporate leaders always preach the importance of building trust with the company’s clients but sometimes take internal trust for granted. If we call on formal research once again, studies show that a high-trust workplace environment makes employees:
- 76% more engaged with their jobs;
- 74% less stressed;
- 106% more energetic at work;
- 29% more satisfied with life in general;
The flip side is that lack of trust makes companies dysfunctional, hindering collaboration and innovation. Instead of fostering healthy collaborative relationships, your employees will develop a fear of sharing ideas, lack of motivation to take the initiative, gossip behind each other’s backs, and showcase manipulative traits.
4. High turnover
A mix of high turnover and short employment periods indicates that your company culture needs work. High turnover is highly disruptive, eating away at your innovation, continuous improvement initiatives, and efforts to build a high-trust culture.
It’s challenging to pinpoint the culprits: it may be the lack of values and vision that represent the driving force of your organization, the fact that your employee’s motivation is exclusively determined by money, benefits, and titles, poor leadership direction, or a combination of all. The result is always the same: employees lose their motivation fast, the dynamics succumb to chaos, and you lose valuable talent instead of retaining it.
5. Reputation issues
You don’t need a dedicated Glassdoor page to determine if your company has a bad employer brand that alienates customers and new talent. If there’s a group voice whispering on the internet or through word-of-mouth that “things are not ok there, stay away,” the morale is in decline, you never seem to hire new talent based on recommendations, and employees resigned in groups at least once, your company culture needs immediate improvement. An unhealthy organizational culture leads to presenteeism, burnout, high turnover – which will ultimately impact your reputation.
Many famous cases prove how bad reputation impacts even multi-million dollar companies. Tech companies have gone above and beyond to lead innovation around company culture.
Still, headlines show that it’s not all happy employees playing video games at work and discussing ways to change the world over free coffee and cookies. Terms like “aggressive and unrestrained,” “churn and burn,” and “toxic” generate lasting bruises on tech giants’ reputations. Sometimes, all it takes is one employee saying out loud that “managers pay lip service to core values.”
The bottom line
Culture is a nebulous concept, and it can be hard to identify the common factors that make up a company’s culture. While there is no one-size-fits-all approach or set of metrics, there are some early warning signs that a culture problem may exist. When these warning signs become particularly pronounced, they can indicate a deeper, more systemic problem in the organization. At this stage, an organizational culture assessment can really make a difference by identifying the issues and providing tools to begin fixing them.