Why Your Startup Should Celebrate March Madness

Any startup that expects to attract and retain top talent had better know how to have fun.

Between bowling nights and ping pong tournaments, however, seasonal events can offer a healthy distraction and unite co-workers outside of long-term, internal projects. Enter, March Madness, the annual grudge match between the basketball teams of colleges and universities across the U.S.

Setting up an office pool or organizing a viewing party after work builds camaraderie by enabling employees and managers to get to know one another based on each others' interests, families, hobbies and passions. While some may view the tournament as a disruption to work, smart founders will embrace the event and leverage the opportunity as a morale booster.

Still don't believe me, consider these three reasons for letting loose and embracing the madness:

1. Boosts productivity.
When employees are happy they're more productive and work better in groups. Celebrating March Madness, for instance, often drives people to work harder, says Trace Cohen, founder and CEO of Launch.it. "It gives you that longing feeling as it gets closer to the finals and gives your company something to look forward to," he says. "That can inspire them to finish their work faster so they can watch the game or trying to win a company-wide prize. Go Cuse!"

Related: 4 Ways to Build a Culture of Innovation at Your Startup

A 2010 study makes the point even more starkly. Harvard Business School professor Teresa M. Amabile and independent researcher Steven J. Kramer concluded that employees reported being happy on days when they were productive (76 percent) and collaborative (53 percent). However, when the same employees reported being unhappy, their productivity and willingness to work in groups dropped significantly (to 25 percent and 43 percent, respectively).

2. Improves employee retention.
Happy employees are not only more productive, they're more loyal too. Employee turnover happens, and it can chime in higher in certain industries. However, establishing a positive work environment with strong company culture, open feedback channels and enticing employee benefits can minimize turnover. That can then save you money by minimizing hiring and on-boarding costs.

Related: Startup Survival 101: It's All About Relationships That Work

Plus, people enjoy working with people they like. Outside of creating camaraderie, Scott Britton, business development exec at business listings site SinglePlatform, believes the competitive spirit of interoffice March Madness pools rallies people around a common bond. As a result of this offices fun-natured competition, Britton says he feels closer to his team -- even after a recent acquisition by Constant Contact.

3. Attracts new talent.
Startup culture is a hot topic and all the large firms are in competition to one up one another. While some offer unlimited vacation time, others offer health-club benefits and 24/7, five-star catered meals. Just think of game night as employee attraction and retention night. Just be sure to let any new hires in on how much fun you all have by regularly updating your "about us" or "culture" page on your site.

Related: Blue, Green, Gold? How to Manage Employees Based on their "Color" Temperaments

While building an engaging and inviting company culture obviously takes time, commemorating the small events that pack your startup's year will surely set you on the right path.

What other camaraderie-building tips have you adopted at your startup? Let us know in the comments section below.