Toxic Workplace Culture Costing Billions

“The conventional definition of management is getting work done through people, but real management is developing people through work” ~ Hasan Abedi

The SHRM 2019 culture report tells us what I thought we should already know about how workplace culture can impact workers. However, the data may be suggesting that we don’t know what we should, we know but maybe don’t care or that we know but don’t know what to do about it. It could be any of the above. The bottom line, though, is the report confirms that workplace culture still matters to people. In fact, people actually care so much, that bad or toxic workplace cultures is costing companies billions due to employee turnover.

In a recent #NextChat session (weekly Twitter chats on Wednesdays at 3p EST) here is how one HR Pro explained the costs associated with toxic workplace cultures:

Kyra Matkovich, SHRM-CP @KyraMatkovichHR

“The costs of toxic workplaces may include high turnover, low morale, absenteeism, presenteeism, low customer satisfaction, low employee engagement, negative employer branding (which can have an effect on ability to attract talent).”

As most HR pros will confess, culture is somewhat in the eye of the beholder.  Yes, we can say good culture is about the good vibes we feel when we experience well run, honest and authentic workplaces.  We can also express culture as a measure of our perception of individual wellness or the robustness of the collegiality that emanates from the people in emotionally intelligent, high functioning teams. We all have our own definition of what good workplace culture looks like and we sure do know it when we see it. The SHRM report (2019) simplifies workplace culture as the “heartbeat of an organization.”

Just as you can tell great workplace culture, there is no mistaking what a toxic workplace culture looks like. We know it when we see it and more importantly, we know how it destroys us as workers, pollutes workplaces and breeds discontent if left to flourish.  So much discontent, in fact, that workers routinely walk away from it. Here is how fellow HR pro explained root of some of the toxicity in the same #NextChat Twitter event:

Mark Carruthers @MarkC_Avg

“Building walls between people or ostracizing people, based on age groups, genders, sexual orientation, race, religion, income levels, departments, management & non-management, or for any other reason, is also toxic behavior.” #NextChat

If you were looking for data showing the effects of toxicity in organizations, this newest culture report from SHRM did not disappoint.  Here are some key findings from the report that supports the anecdotes that both you and I have heard.

  1. Nearly half of American workers have thought about leaving their current organization.

  2. Breakdown in communication is often the most common sign of a toxic atmosphere at work.

  3. Twenty percent (20%) of workers are uncomfortable engaging in conversations with managers.

  4. One quarter (25%) of working Americans dread going to work, don’t feel safe voicing their opinions about work-related issues or don’t feel valued or respected at work.

  5. Of the employees who have left their jobs, 58% say they left due to a People Manager.

  6. The cost of turnover due to toxic workplace cultures over the last five years is $223 billion.

Yes. It is clear we collectively have a workplace culture problem and no matter where it starts in the organization, it invariably ends up on the desk of a HR professional who will probably say - Yeah. I saw that coming. The reality is that finding answers is not that easy and even when the triggers are known, doing something about it is not always easy because the “why” and the “how” could vary widely depending on who you speak with in the organization.

Given my belief that culture rolls downward from leadership, here are some of the questions that I use to drive observation and ultimate discussion with employees and leadership when trying to address toxic workplace cultures.

  1. What messages do we send to employees about workplace culture?

  2. What actions are rewarded by leadership that sets the tone for culture?

  3. How does our organizational priorities impact culture?

  4. How do we distribute power and what does that do to culture?

  5. How do we build in accountability as guardrails for culture?

  6. How do we ensure inclusivity as we set expectations for culture?

  7. Are the artifacts of our culture clearly visible?

  8. What behaviors of our superstars have we let slide?

  9. How are leaders driving a positive or toxic culture?

  10. Does every employee have a clear vision of what your culture represents?

In today’s ecosystem where employee sentiment is so easily displayed and spread on any number of social media or recruiting websites, people increasingly are not staying silent about toxic workplace cultures. If the goal is to remain sustainable, and not needlessly contribute to the billions of revenues lost to toxic cultures, this has to be a priority for People Managers and leaders.