The culture that leadership cultivates in an organization is directly linked to the overall profitability of the organization. That is a pretty big statement to make when it is sometimes difficult to capture hard data to validate the statement. This week we share insights to help give some framework we have seen in this area where leadership either enhanced the profit by focusing on culture or impacted the profit as a result of their lack of attention to culture.
Although the words culture and environment are not exactly the same term, they are sometimes interchanged in conversations when speaking to the level of impact the business environment has on the outcomes. For example, you may hear in conversation the language of “it is such a toxic environment.” This may be referring to the way individuals are treated in an organization. It may refer to the level of language acceptance an organization allows to take place which may offend the staff members. There are many possible contributing points which invoke the idea of being “Toxic.”
However, the toxicity it creates has a direct impact on the productivity and contribution levels of the team members to the organization’s objectives. We are often made aware of toxic environments which exist in businesses. Although we are not directly involved in this organization, the story as we were told follows a common path of business leaders or individuals who are given additional responsibility but are not developed to handle such levels of accountability and their reactive course of action is to be punitive to get things accomplished. This punitive approach manifests itself in many ways; yelling, foul language, various reprimands, added work etc. This then creates an environment where the team members begin to feel negative about their role and contribution to the organization.
When such situations arise in an organization then not only are the individuals in the business impacted but the resulting disengagement impacts the customer as well. In turn when customers are impacted by internal challenges then revenues and profits are impacted. If as a leader in your organization, you are not setting the proper tone for the organization then you let it become what ever the others who are touching it feel is appropriate.
We all come from a variety of past situations which cumulatively influence our behaviors and how we interact with others. If a leader does not set the tone, then all of those in the organization are allowed to use their own past experiences to govern the behaviors etc. Think of it this way, if a person is not treated with respect, how well do you think they are going to treat others with respect? If one person yells at another person what influence will that have on the next line of communication.
This week as you work on your business rather than just in it, observe the culture, the environment, the way interactions take place both internally and with customers. What are you seeing, hearing, experiencing? Are these behaviors acceptable to the brand you are building? Would others view these interactions as toxic?
Once you have your perceptions of the culture, ask yourself how those are impacting the success, the engagement of staff, the relationships with customers and thus impacting the profitability of the business.
Looking to examine your culture through a pair of third-party eyes, and ears? JKL Associates can assist in this assessment process. Reach out to us for a no obligation conversation at MI (313) 527-7945 or FL (407) 984-7246