What does workplace culture have to do with performance? A whole lot, as it turns out.
According to some estimates, U.S. companies lose between $960 billion and $1.3 trillion to poor performance and lost productivity every year. Of the myriad factors that contribute to this staggering inefficiency, workplace culture is one of the most commonly cited. Organizations that cultivate hierarchical or fearful cultures inspire their employees to look elsewhere. Their managers spend time reactively replacing staff and explaining expensive turnover.
One sign of a truly unhealthy work culture is workplace bullying: a pattern of intimidation or humiliation which undermines employees and their performance. Consider a few facts from the Workplace Bullying Institute:
- 27 percent of Americans (roughly 37 million workers) have been victims of workplace abuse
- 72 percent of employers either condone or explicitly sustain bullying
- less than 20 percent of employers act to stop bullying.
In the healthcare industry, the effects of workplace bullying are especially troubling. According to the Incivility and Bully Fact Sheet, bullying is related to 21 percent of overall nursing turnover, and replacing each nurse can cost up to$88,000. Of the new graduate nurses who quit within their first six months, 60 percent cite bullying as their reason for leaving. This ensures a steady loss of expertise and failure to develop emerging nurse leaders. Sadly, we even have a proud adage to describe this tendency: Nurses eat their young.
The impact to patients, employees, and organizations is profound. One study finds that 75 percent of respondents say that disruptive, bullying behaviors led to medical errors, with nearly 30 percent leading to patient deaths. The Fact Sheet also reports that employees often experience PTSD-like symptoms, job loss, physical illness, and substance abuse disorders. What’s more, organizations that succumb to a bullying culture suffer from poor performance including failure to meet goals, grievances, turnover, absenteeism, lawsuits, poor reputation, and decreased productivity, according to research from The Joint Commission.
“Corporate/institutional bullying occurs when bullying is entrenched in an organization and becomes accepted as part of the workplace culture,” writes the Safety & Health Assessment and Research for Prevention Program. The environment is steeped in a lasting culture of fear, which kills performance and drives away talent. Most innocuously, this fear-driven culture hinders routine work efforts. Even more insidiously, fear prevents the growth and development of future talent. It stifles great potential and bright ideas. It reduces management to mitigating turnover and disengagement, creating an endless tailspin.
In this environment, performance management often becomes synonymous with managing underperformance. Yet leaders are powerless to directly change the culture at the heart of poor performance. By its very nature, workplace culture is pervasive, subject to gradual influence—not knee-jerk reactions. And poor workplace culture is often attributed to the leadership style of management. According to Gallup,“Lousy cultures have miserable managers everywhere—even on the executive committee.”
Clearly if the culture is lousy, performance is poor, and managers are miserable, it must be the result of poor leadership, right? Not necessarily. Gallup explains that managers are often motivated to develop talent rather than merely manage performance, hence the term: performance development. But what tools do they have to support their efforts to foster a healthy and safe workplace culture, reach individuals employees, and truly develop talent?
Research reported in a recent ATD blog post finds that only 23 percent of HR executives feel that their performance management process accurately reflects employee performance. And Mercer reports that only a handful of organizations worldwide (3 percent) say that their performance management system delivers exceptional value. Even with the best of intentions, managers may themselves be underperformers without the right tools, unable to affect meaningful cultural change. The right tool, on the other hand, has the ability to empower managers, to transform them into impactful leaders.
Let’s take another look at the numbers. For starters, 72 percent of employers either condone or explicitly sustain bullying by denying or discounting that bullying is happening. Read at face value, this paints a terrible picture. The assumption is that managers must not care, and we should probably replace them. When we dig a little deeper, we find that it’s the manager’s job to foster a positive culture, improve performance, retain employees, and develop talent in accordance with the organization’s needs. Sounds easy, right? Yet Mercer finds that only 22 percent of organizations worldwide have a formal feedback system for performance management. The vast majority of our managers lack a platform for feedback, dissemination of information, or collaboration—all of which are crucial contributors to workplace culture and performance development.
So when the manager’s résumé and previous achievements don’t align with their current output, it may be time to take a hard look at the tools available to them:
- How empowered are managers to realize their bright ideas?
- Do they have tools to authentically engage staff?
- Is there a way to help managers reach, motivate, recognize, and unleash the potential of the frontlines?
Bottom line: The link between workplace culture and performance—and the managers ultimately responsibility for both—is easily apparent. Less obvious are the barriers managers face. When gaps persist between objectives and performance, performance management tools may serve as crucial keys to both managerial and organizational success.
ManageUp PRM has devoted years to developing a robust solution that ensures managers and employees alike can realize their full potential. This innovative performance management platform features an integrated feedback system, collaborative networking tools, central knowledge repository, and an effortless staff recognition process driven by technology and gamification. The ManageUp PRM tool connects managers and employees, ensuring open lines of communication which in turn, foster collaboration, learning, and the development of our most important resource—talent.
Want to learn more? Join us on June 26 for the ATD webcast: Driving a Championship Culture by Leveraging Role-Based Operational Management Platform.