The term "Culture eats strategy for breakfast." was attributed to management consultant, educator, and author, Peter Drucker in 2006. However, it is now 2023, and we still have companies holding on to old business models that do not support their most significant asset, their people. So what does "Culture eats strategy for breakfast." mean? In a nutshell, no matter how great your business strategy is, your plan will fail without a company culture that encourages people to buy in and implement it. In plain, straightforward terms, you get out of your employees what you put into them.
While a good strategy is essential for any organization, a strong and positive culture can be the driving force behind its success. A healthy culture can create a sense of unity, purpose, and commitment among employees, leading to better collaboration, innovation, and customer satisfaction. On the other hand, a toxic culture can undermine even the best strategy. When employees feel disengaged or unsupported, they are less likely to put in the extra effort required to execute a strategy effectively. They may also be more likely to leave the organization, resulting in high turnover and increased costs.
Gone are the days when employees started in the mail room and worked their way up through the ranks to retirement. Boomers and Gen X may have bought into chasing the carrot on the stick, but their children learned there was no loyalty in the workforce. They saw their parents struggle to get ahead, only to be laid off right before retirement. Additionally, as technology grew and the internet became an endless source of information, a new way to get ahead in the workforce emerged. Employees learned to move from company to company to get where they wanted. Today we have an average tenure of 4 years for men and 3.6 years for women, but an unhappy employee may only stay 12-18 months.
What is even worse is that high turnover is "silently quitting." Silent quitting, also known as "quiet resignation," is a phenomenon where employees disengage from their job and begin to mentally check out without formally resigning. A culture with a toxic work environment, a lack of opportunities for growth or advancement, feeling undervalued or underappreciated, or a lack of support from management can cause employees to quit silently. Employees who are silently quitting continue to come to work and perform their duties, but they do so with less enthusiasm and commitment. They may avoid taking on new responsibilities, stop contributing ideas, or withdraw from social interactions with coworkers. Over time, their disengagement can become more pronounced, and they may become less productive or start to make mistakes.
Additionally, a bad culture can spread like cancer, leading to decreased morale throughout the organization and reducing motivation and job satisfaction. Employees who are unhappy may not provide good customer service, leading to dissatisfied customers, negative reviews, and decreased revenue. A bad culture can stifle innovation. Employees who do not feel physiologically safe will likely be uncomfortable sharing their ideas or taking risks. Finally, A toxic work environment can lead to legal issues such as discrimination, harassment, or retaliation, damaging the organization's reputation and resulting in costly lawsuits.
Implementing a people-first culture that prioritizes the needs and well-being of employees above all else can mitigate all the above issues and implement several advantages for an organization, like increased employee engagement, improved retention, a positive reputation, enhanced innovation, and better customer service.
Increased employee engagement: To increase employee engagement, an organization should acknowledge and appreciate employee contributions, foster growth opportunities, and establish a positive work environment where employees feel supported, valued, and secure. Connecting employees to the organization's mission and values can give them a sense of purpose, leading to higher engagement and commitment levels that improve performance and productivity. Employees who feel that their work has meaning and contributes to something larger than themselves are more likely to be engaged and committed to their jobs.
Additionally, a culture that prioritizes employee growth and development and offers opportunities for training, advancement, and new challenges will have more engaged employees. When employees can grow alongside the organization and feel psychologically safe and valuable, they are more likely to offer their opinions and ideas. When those contributions are valued through rewards and recognition, and employees know they are making meaningful contributions, they are more likely to be engaged and committed to their work and become more invested in the organization.
Improved retention rates: A people-first culture can lead to higher retention rates. By prioritizing employee satisfaction and well-being, organizations can create a more supportive and positive work environment that encourages employees to stay with the organization for the long term. As employees feel satisfied and fulfilled in their jobs, it reduces turnover costs and helps organizations retain top talent. An organization can help employees feel more satisfied and fulfilled by building loyalty, fostering positive relationships, and providing work-life balance. Offering growth and development opportunities and recognizing and rewarding employees also improves retention.
An organization that values employees as individuals and seeks to meet their needs and expectations can foster a sense of loyalty and commitment among its employees, increasing their likelihood of staying with the organization. In addition, fostering positive relationships by creating opportunities for people to work in cross-functional teams can induce a positive work environment where employees feel like they belong. Belonging is essential for employees to want to stay with an organization and maintain these relationships. Lastly, providing work-life balance or adding flexibility can create a more positive culture. Offering flexible schedules, telecommuting options, and other accommodations to help employees balance their personal and professional lives can reduce stress and burnout, making it more likely for employees to stay.
Positive reputation: An organization with a people-first culture is more likely to be viewed positively by employees, customers, and the public. When an organization has a positive image makes it a more attractive place to work and do business. In addition, organizations prioritizing employee well-being are more likely to invest in their communities and support charitable causes, attracting positive media coverage and enhancing their reputation as good corporate citizens.
Positive media attention and a strong brand can attract and retain top talent. Employees in a people-first culture are more loyal and satisfied, increasing their tenure and tacit knowledge about the company. Happy employees with tacit knowledge are more likely to have enhanced productivity and higher quality of work. They provide better customer service resulting in higher customer satisfaction, positive word-of-mouth recommendations, and ultimately strengthening the organization's reputation. Therefore, by prioritizing employee well-being through a people-first culture, organizations can create a positive image that enhances their reputation and contributes to their long-term success.
Enhanced innovation: Organizations that create an environment through a people-first culture that encourages new ideas, experimentation, and continuous improvement, lead to enhanced innovation and long-term success. When organizations empower employees and provide resources to support creativity, collaboration, and experimentation, employees feel supported, valued, and safe. As a result, they are more likely to take risks, share their ideas, and experiment with new approaches in this environment. In a culture that promotes collaboration, employees who work together and share their knowledge and expertise are more likely to build on each other's strengths resulting in new ideas and innovative solutions to organizational challenges. Additionally, when an organization offers resources such as training, tools, and time, and employees are empowered to take ownership of their work, new innovative products, services, and processes can be developed that give the organization a competitive advantage.
Improved financial performance: A people-first culture can improve financial performance in several ways. A culture prioritizing employee well-being can increase employee engagement and productivity. When employees feel supported, safe, and valued, they are more likely to be engaged and committed to their jobs, leading to increased productivity and better performance. Additionally, a people-first culture that prioritizes employee growth and development and offers opportunities for training, advancement, and new challenges will have more engaged employees. Engaged employees are less likely to leave, reducing turnover and the associated costs, and are more likely to provide better customer service and drive innovation, leading to increased revenue and profits.
Additionally, organizations prioritizing employee well-being and offering a positive work environment are more likely to attract and retain top talent, leading to increased productivity, better performance, and enhanced innovation. Furthermore, top talent is more likely to be innovative, leading to new products and services that can increase revenue and profits. A company culture that prioritizes employee well-being and social responsibility creates a positive image and attracts customers, leading to increased revenue and profits. Therefore, a people-first culture can improve financial performance by increasing employee engagement and productivity, reducing turnover and associated costs, enhancing innovation, and attracting and retaining top talent and customers.
Overall, creating a people-first culture requires a commitment from the top leadership, a willingness to invest in employees' well-being and development, and a long-term perspective that prioritizes sustainable growth and success. While it can be challenging, the benefits of a people-first culture can be significant, including improved financial performance, enhanced innovation, and a positive reputation as an employer of choice.