Jeff Sinegal, co-founder of Costco, created a solid performance culture through decisions that were widely seen as counter intuitive. For example, during the economic crisis in 2008/09, he gave employees a pay increase, explaining that “We should be helping the employees in bad times- not letting them go”.
Sinegal was clearly on to something, as shown by Costco’s stable, predictable stock. What’s keeping their stock in check, you may ask? High quality performance and profit year in and year out. That’s the power of great company culture. Additionally, in 2019 Costco’s net income grew by 17% and they’ve consistently received top ratings on Glassdoor.com as a great place to work.
Compare this to Jack Welsch, former CEO of GE, who was considered the business leader to follow in his 20 years as head of the company. (Many people continue to use his methods as their leadership philosophy). He focused so ruthlessly on performance and shareholder value, that after he left the company in 2001, GE’s share price steady declined. It eventually plummeted in the GFC due to GE’s ineffective diversification, which forced them to heavily rely on their financial arm. These days, GE’s share price is about what it was back in the mid-late 1990s.
If you’re contemplating some difficult decisions in your workplace around restructures and redundancies, now is the time to protect (and even grow!) your great workplace culture.
- Start with a strategy and ask some questions.
Are these changes going to help or hinder business growth in the short-medium-long term? What other options are available to us? Have we properly explored them or just made assumptions? ( i.e. Not asking a staff member to take leave because you’re assuming they won’t).
- Consult with your employees.
Although this is required under the Fair Work Act, many businesses are still missing this step. I invite you to take this compliance requirement seriously. GENUINELY consult and listen to your teams and any ideas they may have. Working alongside your team in this way greatly increases your chances of a better outcome.
- Provide support.
Not just to employees that may be leaving, but also to those who remain.
Don’t underestimate the emotional impact others’ departures may have on your current staff – there may be feelings of guilt and anger (just for a start). This is the time to lean on your EAP and give leaders the tools and frameworks to keep communication flowing.
- Pulse Check.
It’s tempting to avoid surveying your staff on satisfaction and engagement in tough times. It can be hard to receive that feedback.
But this is the best time to stay connected to your employees. If you have a leaner team, you need to increase engagement. Believe it or not, that’s how companies continue productivity and growth through hard times. Utilise some pulse checks on a regular basis to understand what is happening in the workplace and how you can help.
The fact of the matter is that engaged employees lead to high performance, growth, and long-lasting businesses. According to the 2019 Best Places to Work Australia study, the best businesses with <100 employees averaged over 15% revenue growth and have remained in business for over 20 years. When this crisis is over, you want to be the business that can still provide value to your customers and thrive.
No matter the financial position of your organisation right now, this isn’t the time to forget about workplace culture. Keep a long-term vision, continue to respect and engage with your employees, and you will be well poised to build a business that endures and grows.
Have you had any recent success of engaging and communicating with your team? (Breakthrough moments, ideas for growth, etc.) We’d love to hear! Share in the comments section below.