Publisher’s Note: Welcome to an all-new regular column in C&R, authored by restorer, industry leader, and CEO Katie Smith. The first week of every month, be on the lookout for a fresh Culture Under Construction column from Katie where she will share wisdom, experience, and actionable steps you can take to continue to build a healthy culture in your company.
If I asked you to describe your company’s environment and how your team treats each other using just three words, what words would you choose?
I’ll give you a minute to think about it. Grab a Post-It and write those words down.
Did you describe a place where you want to spend the majority of your time? If not, no worries. I’ve been where you are. You probably know that something needs to change, but you don’t know where to start. Hopefully you’ll know by the time you finish reading this column.
Before we dive into how to change a company’s culture, let’s talk about what culture is. Culture refers to the shared values and beliefs that define an organization. Why should you care about culture? Because culture drives performance! Plus, a great company culture is your best hiring, engagement, and retention tool.
You may think you don’t have a culture. If so, I’ve got bad news for you. You definitely have a culture, and it’s probably being defined by your under-performers and disengaged employees. As the leader of your organization, you have the opportunity to cultivate your company’s culture and turn your place of business into an environment where you, and your people, look forward to walking into every day.
Culture can easily be confused with morale, but they aren’t the same. A major difference between the two is that morale is a mood. It’s temporary, and changes from time to time, just like a human’s mood. Even with a healthy culture, morale can sometimes suffer, usually due to a heavy workload or because you’ve hired someone who’s not a cultural fit and they’re bringing others down.
Morale can be corrected fairly easily. If workload is causing a dip in morale, you can schedule everyone to work a half day, feed your team, and go out of your way to communicate how much you appreciate everyone. That usually improves the mood. However, a pizza party is not going to change culture. Creating and maintaining a positive culture takes intentional effort of living by an established and well-communicated set of values, day in, day out. It takes a well defined purpose, vision, and knowing the reason why we get out of bed every day. It takes consistency and discipline.
If you’re wondering how your culture measures up, I’ve got good news for you: culture isn’t just a feeling, and there are numerous ways to measure your company’s culture. If you aren’t yet using Key Performance Indicators (KPIs), now is a great time to start!
Employee Satisfaction and Customer Satisfaction scores are two great indicators of how people feel about your company and its culture. If you don’t have an easy solution for calculating your employee or customer Net Promoter Scores, that’s ok! You can anonymously ask your employees to rate their overall level of satisfaction on a scale of 1-5. This can be as simple as creating a single question anonymous Google Form and texting the link to your team. For a simple customer satisfaction score, you can use your online star ratings.
It doesn’t really matter what method you use, as long as you’re paying attention to the feedback. Remember, your team takes your culture into your customer’s property! Once you realize that a healthy culture creates happy and engaged team members who create happy customers, it becomes a no-brainer to invest your time and resources into building a great culture.
Here are a few more KPIs that give you a window into the health of your culture:
- Voluntary Turnover – how many of your team members are choosing to leave? This measurement can be as simple as the number of people per year, or you can use this formula: (Employees Who Quit / Number of Employees) x 100. In the rapidly changing post-Covid job market, it can be difficult to find a realistic benchmark for this KPI using the formula, so I recommend using a count instead.
- Referrals – when people have a positive experience with you, they’ll tell their friends.
- ○ Employee Referrals – you can either track how many great hires were recommended by a team member, or you can ask this yes/no question anonymously: “Would you refer a friend to work here?”
- ○ Customer Referrals – You are measuring where your customers come from, right? How many of them are word of mouth referrals, or previous customers? High performing cultures generate raving fans!
- Revenue Per Employee – Engaged and satisfied team members are productive team members. Are your employees working together as a team to achieve a common goal, such as a sales goal?
- Attendance (Call-Outs) – Are you tracking call-outs? Do you have any patterns you need to address? Look for Monday call-outs to discover who dreads coming to work.
- Warranty Jobs – Disengaged team members usually produce work that needs to be corrected at a later date. You only get paid to do it once!
- Turn on AR- Satisfied customers typically do whatever it takes to make sure you get paid quickly. When your culture leaves a bad impression, the customer isn’t going to make your payment a top priority.
Those KPIs are easily generated with accounting, CRM, and HR software. By the way, if you aren’t yet using HR software, I wholeheartedly recommend that you schedule a demo with BambooHR.
Here are some observations you can make that can indicate the health of your culture:
- Attendance at Company Events – This is one of my favorite culture indicators! Here’s a challenge for you: plan an outing or a meal (with plenty of advance notice) at a time when your team isn’t expecting a Christmas bonus. See who shows up. Low attendance = low engagement and satisfaction. When you have a great culture, your team will tell you that “the people” are their favorite part of the job, so try to create fun opportunities for them to spend time together.
- How Many Fires You Put Out Per Day – This is somewhat of a joke, but also a good indicator of the general environment. Are you dealing with problems all day? Are you dreading going to work because of the drama that awaits you? Maybe there’s a deeper problem you need to solve.
- Laughter – This is one that we take for granted when it’s present, and you definitely feel it when it’s lacking. How often do you hear laughter coming from another room? If it’s been a while, that’s a red flag.
The great thing about KPIs is that you don’t have to use a lot. Just pick the most important ones, and don’t make KPIs a full-time job! Measure what’s manageable for where you are now.
If you really want to create a great culture, get in the habit of soliciting feedback from your team at least once per year. Earlier I suggested that you send an *anonymous* employee satisfaction survey to your team. This is a great opportunity to ask various questions that will help you shed some light on your blind spots.
Before you send out an employee satisfaction survey, please know it can be difficult to listen to feedback without being defensive. That’s because our companies are a reflection of us and when someone says something is wrong, we take it personally. In those moments, be grateful you’ve got someone willing to speak up. It means they care and they want to make it better. The minute you get defensive, your people will shut down and will hesitate to tell you the truth the next time you ask for it.
Once you’ve had time to process the feedback, begin to think about how to change what you can control. Commit to a few small steps you can take to create a more positive environment. Then, communicate your commitment to your team. Thank them for sharing their thoughts with you. Recap the results with them. Show humility and acknowledge that you’ve got work to do, and be consistent!
Now that you’ve got a benchmark of where you are, you can begin to create a vision and a plan of where you want to go. As you create a plan to improve your culture, you can administer the survey year after year to measure your performance and tie your efforts to results. In a later column, we’ll dig into culture’s relationship to your mission, vision, values, and your strategic plan.
A couple of parting thoughts:
- You may be thinking “I don’t have time to focus on my culture.” You have a choice: you can make time to work on developing your culture and your team OR you can make time for constantly turning over your team.
- At the beginning of this column, I asked you to describe your culture in three words. Your company is a reflection of you, and your vibe attracts your tribe. Did those three words describe you? If you aren’t emotionally and spiritually healthy, don’t expect your environment to be healthy. Culture starts at the top. Take care of yourself so you can take care of others.
Finally, I want to leave you with a resource to help you get started. This link will show you an example of an employee satisfaction survey. I am happy to share this with you so you can edit it and use it for your team! Just shoot me an email ([email protected]) with “Culture” in the subject line.
Once you get access to the form, you can:
- Rename the survey
- Send it out to your team via text and email with a deadline of 1 week to complete.
- Send out periodic completion reminders up until the time the survey closes.
- Read the results, be grateful for the feedback, and get to work on cultivating your culture!
Katie Smith, CR
Katie Smith, CR is the second generation owner of PHC Restoration in North Carolina, an independent company committed to making a positive impact on its team, customers and community. Passionate about servant leadership and building relationships, Katie plays an active role both inside of her company and within the industry. She currently serves as the President of the Restoration Industry Association, the oldest and largest non-profit, professional trade association dedicated to providing leadership and promoting best practices through advocacy, education & professional networking opportunities for the restoration industry.
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