6 Red Flags About Company Culture to Watch Out For

When a company has the right corporate culture, productivity and revenues rise, customers buy more, good employees stay, and great employees join.

But maintaining a positive company culture that supports your strategy requires constant attention. When company culture is neglected, small cracks can appear. Without attention, these small cracks eventually become gaping holes. In short, your culture will develop whether you pay attention to it or not.

CEOs know that culture is the way to make strategy and results a reality. Daggerwing Group deploys a rapid assessment of a company’s corporate culture to help executives flag toxic issues that can bubble up even in culturally strong companies.

Here are the six red flags we look for when assessing a company’s culture or get in touch:

1. BAD BEHAVIORS GET OVERLOOKED FOR BUSINESS REASONS

Things are going great, so why change? The brilliant jerk is driving results so let’s excuse their bad behavior. Or worse yet, the short-term costs of dealing with a behavioral problem are too high, so let’s just ignore it. Companies that avoid fixing bad behaviors for business reasons will eventually suffer. A strong company tolerates short-term pain for a stronger long-term culture.

2. LEADERS DO NOT DRIVE THE VALUES THROUGH EXAMPLE AND CONVERSATION

“Do as I say, not as I do” is not an effective way to drive culture. Enron’s values of Communication, Respect, Integrity and Excellence were meaningless and empty. These empty value statements can create cynical employees.

Culture is not just about how employee behave. It’s about how leaders walk the talk, every day. Culture change only happens when leaders start to “be the change they want to be” as their employees watch their every move. When a new CEO stepped in at one of our client organizations, he immediately showed his commitment to collaboration – one of their core values – by visibily partnering with others across the business and highlighting examples of successful collaboration.

3. BUSINESS AND PEOPLE PROCESSES ARE NOT ALIGNED WITH CULTURAL VALUES

Corporate structure and initiatives need to support the values of the organization. We’ve heard of big organizations that want to move faster, but have review meetings with 45 people attending for approval. This demonstrates a disconnect between organizational structures and process with company values. One of our clients found that leaders weren’t providing enough clarity around goals and priorities for their teams, leading to wasted effort and low productivity. To help shift behaviors, their HR team built goal setting into leader training programs and adapted their performance management system to reward managers who excelled at setting clear direction.

4. LACK OF FEELING OF OWNERSHIP AND EMPOWERMENT AMONG EMPLOYEES

A culture of empowerment and ownership, where employees have the freedom to make decisions, is the sign of a healthy culture. It leads to faster problem resolution, job satisfaction, and greater accountability. If employees feel like they can make a difference, it’s a sign that your culture is on the right track. If it’s missing, it’s a sign that employees have become disillusioned with the current state. Recently, we helped a large global client that was implementing massive changes across the business empower local teams to totally own the situation on the ground, letting them respond in real-time and make decisions on behalf of their teams.

5. PEOPLE ARE NOT ENABLED OR ENCOURAGED TO BUILD NEW UNDERSTANDING OR SKILLS

An 11-year study comparing the performance of 12 companies showed that those with adaptive, performance-enhancing or high-impact learning cultures win in the marketplace. The driving force was whether companies invested in skill development. New skill development is vital for long-term success.

6. NO ONE IS REALLY LISTENING AND EMPATHIZING WITH PEOPLE’S CONCERNS

The best cultures actively seek out and deal with issues and problems. Employees are listened to and problems are addressed. This is especially important for dealing with issues before they become a major problem.

If one or more of these red flags are present in your company culture Daggerwing can help. Daggerwing Group’s FASTTrack Culture 30-day readiness assessment helps CEOs get out front of culture issues that can derail success. Take action now to assess and address gaps in your corporate culture.

Katie Papazian, Managing Consultant

Katie Papazian, Managing Consultant

Katie Papazian is a Managing Consultant at Daggerwing Group. She works with clients to engage, inspire and care for their most important asset – their people. Katie has worked on projects ranging from global transformation efforts, communications strategy and implementation and culture analysis and change. Her favorite projects, however, are her quest to fill up her passport with as many new stamps as possible, making her cat Peanut an Instagram celebrity, and crafting the perfect Spotify playlist.

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