The link between employee satisfaction and a company’s success
Whether it’s office amenities, a monthly gym stipend, or weekly team bonding, company culture has become a top criteria for applicants looking at a workplace. While these bells and whistles are tempting to many, what really is company culture, and does it impact employee satisfaction and overall business success?
The culture of a company is the personality of an organization from the employee perspective, which includes the company’s mission, expectations, and work atmosphere. It may be written down in a company manifesto, translated in the business’s logo, or simply an unspoken but understood definition—in short, culture determines a company’s environment. An example of a great company culture is Buffer—recognized as one of Inc. Magazine’s Best Workplaces in 2018, Buffer boasts top-notch health benefits, a fully remote team, and incredible overall perks. With over a 90% employee retention rate and only a 9% turnover rate, Buffer’s clearly doing something right.
And according to statistics, it’s not just Buffer that’s finding success with employee benefits: a Columbia University study shows that a company’s culture has a direct impact on employee turnover, which affects productivity, and therefore success. The likelihood of job turnover at an organization with high company culture is a mere 13.9 percent, whereas the probability of job turnover in low company cultures is 48.4 percent. Another study by Glassdoor found that a portfolio of companies with high employee satisfaction significantly out-performed the overall stock market, earning 1.35 percent extra returns above the market. Paying attention to employee satisfaction can also be in the financial and economic self interest of companies, and will show significant ROI.
Speaking of paying: unhappy employees cost American businesses over $300 billion each year—yikes!
Numbers also show that it’s especially effective to invest specifically in employee health: a study by The American Society of Exercise Physiologists demonstrated a 22% reduction in absenteeism (the number of sick hours/year) with the institution of a fitness program. Using that 22% decrease in absenteeism, this study estimated that a savings of $83,265/year would be evident in the company! Moreover, another study by the Social Market Foundation found that happy, healthy employees are up to 20% more productive than unhappy, unhealthy employees. When employees are in good health, they are more engaged and focused, and unhealthy employees are often less productive and have improved morale.
At the end of the day, companies should be a place where no employee wants to leave. To ensure that, employers need to be investing in their employees’ health and happiness: in short, their company culture. By recognizing that employees are a key asset to business, companies can achieve significantly higher performance and employee retention over the long-term. Creating this work environment for each team member isn’t a waste of money or time—in fact, it’s a competitive advantage. Encouraging a strong, health-conscious culture within your company will attract new talent, raise the morale of your existing employees, and bring your company overall success.