Looking to Improve Retention?

Compensation and benefits. Training and development. While traditional tools for maximizing employee retention abound, many organizations overlook one relatively easy and cost-effective way to keep people from leaving-create a place no one wants to leave.

The right culture can halt the exodus!

Employee retention may be the single most significant issue facing many companies today. So, what can employers do to retain their best and brightest?

One solution comes from an unlikely source-corporate culture. According to Peter Tobia, director of Kepner-Tregoe's Business Issues Research Group, the firms that are most successful at retaining top performers don't manage retention-they manage people.

Retention leaders focus on the work environment and ask: "How can we manage our environment to better leverage our human assets?" They emphasize values and create structures and systems that are people friendly. They also support their people by providing them with adequate resources to do their best work; fair and uniform standards; regular, useful feedback; and the appropriate rewards and recognition. In short, retention leaders focus on creating the right culture.

Unfortunately, many managers can't even identify the characteristics that make up a company's culture-let alone create a desired one.

So how do you build your corporate culture? First, you must understand the elements of culture, and then collect the data necessary to assess your culture. With this information, you can design and manage a culture that is in alignment with your strategic objectives-one that will inspire and reward your employees.

Defining Culture

Corporate culture is derived from the attitudes and opinions of employees toward things like company leadership, structure and style, autonomy granted to middle managers, fairness of reward systems, and ultimately job satisfaction.

Corporate culture can be divided into three basic components: structural, political, and emotional.

Structural. Culture is determined by the size, age, and history of the company; the industry in which it operates; the geographic location; and the types of goods and services produced. These factors influence how a company works, and how employees interact with each other, their managers, and their customers. While many of these factors cannot be changed, you can ensure that the right people occupy the right positions within the corporate structure.

Political. Culture is defined by the distribution of power and the primary modes of managerial decision making. A company's political make-up sets the tone for employee actions and contributes to how people feel toward their roles. Leadership styles can range from dictatorship to total empowerment. You need to know what styles are compatible with your corporate goals and your employees.

Emotional. Culture is also defined by the thoughts, habits, attitudes, feelings, and patterns of behavior in your organization. Within every company is a set of cultural "norms" which dictate day-to-day behavior. These norms are driven by the attitudes and actions of senior management-both in terms of formal management processes and informal communication.

TO KEEP EMPLOYEES FROM WALKING OUT THE DOOR, ALIGN YOUR BUSINESS STRATEGY WITH THE NEEDS OF YOUR EMPLOYEES.

Gathering Data

Assessing corporate culture requires much more than simple observation. You need to formally assess the company, based on each of the cultural components. To evaluate structural issues, review your organizational chart. Look at the reporting structure, and then define the characteristics and qualifications of the people in each box on the chart. This analysis will provide a perspective for interpreting the results from evaluating other cultural components. To gauge perceptions about the political and emotional environment, employee attitude surveys are most often used. This data will highlight problems that exist in the culture, and help illustrate potential incompatibilities between the people and the strategic goals.

Aligning Success Factors

The objective of corporate culture is to align the corporate attitudes and behaviors with strategic objectives. Once you understand the current status of the organization and the gaps that exist, you can do three things to foster the desired culture.

Establish a vision, not just a mission.

Clearly articulate a vision for the organization-one that stresses the values of the company and guides day-to-day activities. The vision will reinforce and support attainment of the corporate objectives.

Actively manage political and emotional issues.

To accomplish cultural change, many traditions and paradigms may have to be altered. Common changes include the organization's management and measurement systems, the way authority is granted, and the leadership styles of managers throughout the organization. Senior management must enthusiastically live the vision. There is an adage that says "if you want to change culture, change the CEO." The actions of senior managers will determine the ultimate buy-in of the organization. Mere lip service will doom cultural change to failure.

Have constant employee interaction.

Retention leaders approach their relationship with employees as a work in progress. They constantly ask questions, solicit feedback, and then take action to maintain high satisfaction. They keep looking for new ways to improve the structure, politics, and emotions of the work environment-to create a culture that achieves results and makes employees feel committed.

The Right Culture, But Not for Everyone

Retention leaders understand that not everyone will fit the culture they create. Successful employees must possess the skills and experience to do the job, as well as the personality traits to thrive in the corporate environment. Companies that focus on culture, focus equally on hiring, and place great emphasis on locating people with the right behaviors to succeed. The challenge becomes deciding what to do about those who don't fit the culture. There is no simple answer. Long-term alignment of culture and strategy yields the greatest organizational performance. But, with the shortage of skilled employees, perfect alignment may not be possible. To increase employee retention, seek alignment between culture and employee preferences. Ultimately, employees are the drivers of financial performance. Retention leaders place their needs at the top.