10 Symptoms of A Sick Organizational Culture

Employees:

Employees are dishonest: This is the common The Emperor’s New Clothes, yes-man symptom. “Everything is great.” In a corporate culture where employees are afraid to be forthright, you will never get their best. If they’re afraid to disagree and, possibly, fail, they’ll be afraid to try great things and, ultimately, succeed.

High-rate of staff turnover: Turnover costs include: productivity loss when the position is vacant and while training new employees. Add on recruiting costs and lost work. Replacing an employee adds up to approximately 20% of an employee’s annual salary for jobs earning less than $50,000.US/year. *

Absenteeism: According to Circadian (www.workforceinstitute.org), unscheduled absenteeism costs an organization $3,600.00 per hourly employee per year and $2,650 per salaried employee per year. Moreover, absenteeism effects productivity, entails employing high-cost replacement workers and keeping extra staffing to cover chronic absenteeism.

Employee or ex-employee litigation: The average cost to defend an employment lawsuit ranges from $75,000.00 to $125,000.00 – if you don’t go to trial. Employee litigation costs an organization money and a reputation that took years to build.

Managers:

Inert Management: Managers can’t be mistaken for “administrators.” Managers are in positions to make critical decisions and help a company grow and expand. Top management needs to let the reins and not micro-manage their leaders. Micromanagement creates feelings of disenfranchisement and ineptitude.

Lack of Communication: A manager’s key role is to be a communicator. When there’s no dialogue, feedback, listening, discussing an action plan after feedback, or helping employees understand their role in a process, employees are left without a guide.

Lack of Respect: Bullying, fraternization, and a manager with an inflated ego create departments where employees feel insecure and inept. Diagnosing and addressing a manager with these characteristics can help to heal sickened departments.

Bottom line:

Lost Vitality: When an organization stagnates and doesn’t thrive, this is a clear sign of sickness. There’s a new train of thought that instead of measuring growth of a business in terms of expansion, we can reframe that and, instead, measure vitality.** This means products change and grow. Management is fresh and alive. And there’s sustainable growth or “no-growth” that keep the organizational heart beating and revenues up.

Low productivity: People + Process + Product = Success. When your staff’s productivity levels are low, whether it be from lack of engagement, outdated systems and technology, lack of continued training, your product will suffer.

It’s time for a checkup. If your organization is showing any of these symptoms, its culture might be ailing. Diagnosing these problems is critical to start healing your organization and getting it back on the road to success.

*Lucas, Suzanne, Money Watch: How much does it cost companies to lose employees? www.cbsnews.com
** Forrester, Jay, MIT Sloan Management Review: Does Sustainability Mean Surviving Without Growing Your Business, March 26, 2009, www.greenbiz.com