JUly 5, 2018 - BY NICOLE MICHAELIS

How do you measure company culture?

If culture is just as important as ROI, how do you make sure you have the numbers you need to get it the attention it deserves?
Most leaders today are aware of the massive effects a positive company culture brings to business. But only few take the time to dig deeper into building and maintaining a great culture.
No matter if you're a manger, an employee or a consultant, the organization you work for has a company culture. You may only rarely be aware of the culture, but you're acting on it all the time. The company culture is the reason you're super-focused on a new project, eager to reach a deadline. It's also the reason why you are scrolling through the job section on Linkedin and having a hard time getting out of bed in the morning.

We spend a big chunk of our waking time at work and are exposed to the culture the organization we work for creates around us. A culture for growth can make us more productive, boost engagement and wellbeing, and help us thrive, not just at work, but in our daily lives. On the other hand, an unhealthy culture can burn us out, affect our physical and mental health, and kill our motivation.

Most leaders today are aware of the massive effects a positive company culture brings to business. But only few take the time to dig deeper into building and maintaining a great culture.

Why?

Well, sometimes it's a lack of time and responsibility that distracts management from focusing on culture. But more often, it's the lack of an actionable starting point. How do you even know you have a good culture or not? How do you measure culture?
The Culture Gap
Over 10,000 HR and industry leaders were questioned in Deloitte's latest Global Human Capital Trends 2017 report. With over 80% of executives claiming the importance of employee experience, the report concluded that "organizational culture, engagement, and employee brand proposition remain top priorities in 2017; employee experience ranks as a major trend again this year." Yet only 22% of executives claimed that their companies had excelled at building an exceptional employee experience. That's a significant gap.

And it shows on the employee side too:

  • Companies with a rich culture show job turnover at 13.9%

  • Companies with poor culture have a turnover rate of 48.4%

  • 64% of all employees do not feel they have a strong work cultur

With effects this great, it's absolutely necessary that culture is understood and acted on to aid business success.
Measuring Culture: Asking the right questions
As we've written before, a great company culture is characterized by psychological safety. How do you create that type of safety? It makes sense to take a look at our basic human needs. In Maslow's Hierarchy of Needs, before we as humans can be innovative, we have to satisfy our basic needs. We need air, food, rest, and water. We also need to feel safe. This seems obvious, but as you may have experienced yourself, isn't always a given at work.

A comfortable working environment is a great start to meet basic human needs. Transparency and clear communication are a must to decrease rumours and create a safe environment. As a leader, ask yourself:
1
Do your employees work in a comfortable space that meets their needs?
Do employees have enough desk space, areas for quiet time, modern tools to help them do their job? What's considered to be "a good office space" has been through serious changes over the past decades. Do you know what space your employees need today and are you working hard to build and mantain it?
2
Are you communicating regularly and clearly about what's happening?
Do they feel like they're being communicated to cleary? Do they feel connected to the overall business strategy? According to Gallup, engagement is highest among employees who have some form of daily communication with their managers. Are managers and employees collaborating and communicating on a daily basis? If the answer is no, there's likely room for improvement. Going back to Maslow, we can see that after our basic human needs are met, we strive for love, belonging, and esteem.
3
Are you helping your employees on their journey towards esteem?
Everything from encouraging a work-life balance that diminishes stress to paying for a comprehensive medical care plan plays into this category. Monday morning yoga, a free gym membership, or mental health days can help you increase wellbeing and make your employees happier. In return, they'll reward you with more energy and higher motivation. Every company has a set of values. But are you communicating them to your employees?
4
Is everyone aware of the company values?
Ideally, values are what drive who you hire, how you onboard them, and how you collaborate and lead. Stating values clearly can help employees stay in touch with their purpose at your company. Ensuring that your employees are on board with the company values starts with management and trickles down. According to SHRM/Globoforce and Psychometrics, organizations with employee recognition programs report 28.6% lower frustration levels and 48% higher engagement levels.
5
Are you recognizing employees?
Complex company hierarchies can lead to a mismatch in recognition and production. Do you know who pushed extra hard to reach that deadline and have you recognized her for it? You don't need to reward employees with expensive prizes, an honest thank you or mention are often enough to create a positive boost and increase motivation. There are many more questions you can ask yourself to pinpoint the quality of your company culture, from encouraging employee friendships to investing in employee development.
A word of caution on asking

Swedish researcher and marketer Micael Dahlén discovered that people who are often asked to evaluate an experience tend to give worse results and become more critical. It's important to be aware of this bias when you ask for evaluations regularly.
Measuring Culture: eNPS
If your take is that company culture should have a seat at the big table, just as ROI or business development, there are metrics you can look at.

There are reliable, data-driven ways to measure an organization's culture. One trend Taro Fukuyama, CEO of Fond, saw among his customers is using eNPS scores to measure culture objectively, and working objectively to improve based on the collected employee feedback.

The Employee Net Promoter Score (short: eNPS) survey can be a powerful way understand the overall level of engagement of your workforce and the strongest drivers of that engagement - if read correctly, this is a quick way to measure company culture.

The eNPS works similar to the traditional NPS and start with the simple question:

How likely is it that you would recommend this company as a place to work?

Employees answer with a score ranging from 0 (not at all likely) to 10 (extremely likely), and fall into three categories based on their ratings. The survey responses are collected and an overall score is calculated. That score will give you a high-level understanding of the overall happiness of your workforce - and with that you'll have an idea how well your company culture is doing.

After this first step, an even more important second question follows:

What's the primary reason for the score you gave?

This is what you're doing it for. You want to find out why an employee gave a negative score or what made an employee give you top points. Asking this open-ended question and examining the responses helps you understand the biggest drivers of employee happiness and engagement at your company. While examining responses to the second question, make sure to divide the result into helpful clusters such as:

  • What are happy employees saying that makes them particularly likely to recommend your company as a place to work?

  • What's holding neutral respondents back from being happy?

  • Is the dissatisfaction of unhappy employees stemming from something that can be addressed immediately?

When done right, the eNPS is a whole system for measuring culture, not just an occasional outcomes measurement tool. You can regularly survey employees and make sure you have a team of leaders who is dedicated to reading, clustering, and analyzing the responses. That team can then draw conclusions on actions that need to be taken to improve culture.

Savvy tech companies are developing new methods and systems to measure culture every day. No matter which one you chose, it all starts with asking the right questions.

Can you measure culture? We definitely think the answer is yes.

At Everyday, we believe in giving everyone the opportunity to grow and positively impact the teams and organizations they work for.
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