Culture is a financial choice

25 January 2023

Culture isn’t simply an ethical or emotive choice.

First and foremost, it’s a financial choice.

A choice that leaders of an organisation make.

A choice that they stand by, even when the going gets tough.

A choice to put culture before profitability.

Because culture isn’t simply about values and purpose, wellbeing talks, comfy chairs and nights out.

It’s as much about the hard financial decisions you make, as putting values on your wall.

Take, law firms, for example.

One law firm expects its Associates (the up-and-coming lawyers) to bill a minimum of 2,200 hours a year.  Which in turn enables higher salaries as well as higher firm profitability for the leaders of the firm.

Another puts the bar at 1,600 hours a year.

Instantly, you can see how this business decision impacts culture.  It lays down an expectation on its junior staff.  Longer hours, higher pressure (and more money).  Or fewer longer days, more non-billable time (but lower earnings).

At the other end of the spectrum are cleaners for a rail company.  The work is nights – cleaning carriages while commuters are tucked up in bed.

Now you could say, what use is culture to this workforce?  It’s a repetitive job at difficult hours, invariably done on your own.

But one rail company makes a point of creating a sense of community, paying the cleaners to come in 2 hours before their shift to ensure they have time with their manager and can also take part in any training or other briefings as and when they need to.

It means paying a couple of extra hours on every shift.  But they’ve seen what a difference it makes – in terms of community and retention.

Or if you’re leading a recruitment consultancy.  Do you set the target at 35 or 25 calls a day?

And if you’re managing a call centre.  Is it better for colleagues to have a 15 min or 20 min break?

Culture is not just about the good times; but also the not-so-good times.

Is your reaction to a poor financial performance to tell people to work harder (Twitter)?

When you have to make redundancies, do you do it simply by email (Google)?

Of course, you might say that placing more emphasis on company culture will make you more profitable in the long run – or simply ensure you are a better prospect for talent.

But it’s the extent to which you want to put culture front and centre in your organisation.  Many organisations can succeed through a greater focus on gain; others through a promise of fast development.

Culture (of a sort) can exist in even the most toxic environment as teams and individuals seek to create their own communities and cultures – as a form of survival technique.

But it’s how much it matters to your business?  Because when it is invested in, it can deliver the greater benefits of innovation and support, respect and flexibility to change, resilience and trust.

And in these strange times, organisations may find they need this cultural muscle more than ever before.

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