Telltale Signs a Corporate Culture Is Trending in the Wrong Direction

corporate cultureAs a human resource professional, one of your principal objectives is to protect the corporate culture. Culture “equity,” to coin a new term, is as valuable to HR as “brand equity” is to advertisers. Whereas brand equity attracts and retains customers, culture equity does the same with employees. It also drives promotions from within, productivity, and a sustainable business.

Like brand equity, however, culture equity is fragile and vulnerable; it rises and falls. The following are some of the most critical signs that a corporate culture is in trouble. The earlier you spot these signals, the better your odds of reversing a downward trend and rebuilding culture equity:

Cost Cutting Leading to Micro-Management

Trimming staff and delegating more responsibilities to fewer workers is a common response to business and economic uncertainties. When employees are stretched to their maximum capabilities and capacity, however, it often results in micromanagement to avoid mistakes. A shift to this management style tends to cause tension, a loss of enthusiasm and commitment, and problems with employee retention. It also impacts productivity as employees spend time thinking about and discussing the potential of being laid off or transitioned into another role.

Most workers prefer to be trusted. Autonomy maximizes the feeling of pride in one’s work, which leads to better engagement and productivity.

Lack of Innovation and Risk-Taking

We are at a technological crossroads, as we discuss in this article about HR and digital readiness. In every sector, companies that innovate in their operations, products and services, use of technology, and employee experience and employee value proposition gain tremendous advantages. Shortsighted business leaders who wait to see which technologies gain traction before innovating create a lack of inspiration that trickles down through the organization.

One of the trickle-down effects is that mid-level managers and their subordinates carry out their roles more conservatively. They don’t feel trusted to take the kinds of risks that can grow a business; they feel reigned in. Not only does risk-taking decline in this scenario, but so does employee retention. Rewarding reasonable risk-taking is a contributing factor to a positive corporate culture.

Employees in Job Survival Mode

Economic cycles and poor individual company performance can both cause deep-seated fears about job change and job loss. Leaders being dishonest or sugarcoating truths about the business tend to exacerbate these fears and the “survival mode” work styles employees adapt when they fight to save their jobs. In these situations, employees may have ethical lapses or may be too stressed to focus on doing their best work. It’s up to management to shift the workforce out of survival mode, even when circumstances make that a challenge.

Workers Aren’t Free to Disagree

Strong cultures encourage and appreciate diversity of thought and the willingness of employees to express unique or dissenting ideas. The more your business depends on creativity and innovation, the more important it is not to stifle disagreement. Employees should know that their thought processes and perspectives are a valued component of the business. This value should be expressed by leaders in open forums so that everyone can see the positive results that come from welcomed ideas.

Invest in innovation and communication, rather than micro-management and leadership by fear, and you’ll appreciate how these values add to your culture “equity.”