Stop Trying to Retain Employees With Flashy Perks. Rethink Your Organizational Structure Instead. Most execs try to improve culture at a top level with perks, but a better success method might be a hard look at leadership systems as a whole — and a willingness to shake them up.

By Jason Hennessey

Key Takeaways

  • Leadership structure significantly affects how an organization runs and the level of personal investment from employees.
  • Team composition plays a crucial role in fostering collaboration and creativity.
  • Shared goals and shared responsibility align people towards a common goal, promoting collaboration over competition.

Opinions expressed by Entrepreneur contributors are their own.

As any savvy owner or manager knows, company culture plays a foundational role in organizational success, and as a business leader, I consider it a vital investment.

The factors that contribute to both establishing a culture and changing it can be extensive and not always easy to identify. Often, it takes failure to get professionals to truly evaluate theirs. I've seen businesses put a great deal of effort into establishing a positive environment through strategies like team-building exercises, after-work parties, office spaces meant to facilitate community — even repetitive mantras. While all of these can help team members connect, in my experience, they too often have insignificant impact on company culture broadly.

One of this key asset's most defining factors is also one of the most frequently overlooked: the structure of the organization itself. As the old adage goes, we often don't see the forest for the trees. The bedrock structure of an organization is often so ingrained that it's taken for granted, but there are many ways to organize (or reorganize) a business that can radically improve its overall work environment.

Related: Company Culture is Everything

Here are four ways to do that:

Leadership structure analysis

A great deal of a company's culture is owed to its leadership, both individual executives/managers as well as the leadership structure as a whole. Its style and composition directly affect how an organization runs, how teams and individuals are treated and how problems are solved.

Traditional structures tend to be directive, with decisions made at the top level and dispersed down through levels of management to teams responsible for carrying them out. While there are benefits to this system, it allows little room for those not in leadership to voice ideas or provide feedback. The result is that they have little ownership over their roles, leading to low levels of personal investment.

More collaborative structures, by contrast, allow for communication among all levels of leadership and empower individuals to make decisions on their own level, which gives a greater sense of ownership over their roles, and both better buy-in with shared company goals and boosted employee retention.

Team composition

Just as culture stems from leadership, it's also grounded in teams. Traditional teams comprise a group of people with specific skills directed by a leader to achieve a goal. Usually, these groups are fairly isolated from the rest of the company and work mainly within the team itself. While this arrangement can be effective, it often doesn't foster high levels of collaboration and creativity.

So, take note of team diversity within your company. For example, if you need to complete a project or solve a problem, rather than assigning it to an existing team, consider forming a new and possibly more diverse one by determining which staff members would bring unique value. A group of diverse individuals with a variety of skills and viewpoints will foster both creativity and cross-department collaboration. We started this approach at the beginning of the year, and by bringing together various department leads, were able to improve the business product, create better SOPs and improve both employee satisfaction and client retention.

Related: Want Your Team to Excel? Play Games With Them (Yes, Games) to Advance Their Performance to the Next Level.

Shared goals, shared responsibility

Within any organization, there are a variety of goals that individuals are trying to achieve. Despite our best efforts as leaders to get everyone working toward the same ones, people will, of course, have competing interests and/or may not be suitably aligned.

Companies and teams that collaborate well work toward shared objectives, and in my experience, nothing will kill that collaboration faster than needless competition. When team interests compete with others', or if an individual's interest acts in conflict, overall results suffer.

In order to foster collaboration over such competition, you need to account for both leadership and team structure to align people toward a common goal, both within teams and as an entire organization. Giving them shared responsibility for targets and the freedom to make decisions and solve problems fosters both inventiveness and dynamism.

Flexibility and resilience

Successful company cultures are resilient in the face of challenges and change. Both are constant, unavoidable factors in business, and a strong culture is one that's flexible and adjusts as necessary. Change might take the form of new systems or technology, industry changes and shifts in leadership or team personnel, and in each of these situations, a culture that collaborates well is more likely to be pliable, resilient and successful.

Related: How to Build a Company Culture That Retains Loyal Employees

As entrepreneurs, it's incumbent upon us to not only acknowledge the profound influence organizational structure has on company culture, but also to proactively build systems that encourage collaboration, diversity, shared responsibility and adaptability. By taking these steps, we empower companies to thrive, both now and in the long run.

Jason Hennessey

Entrepreneur Leadership Network® Contributor

Entrepreneur & CEO

Jason Hennessey is an entrepreneur, internationally-recognized SEO expert, author, speaker, podcast host and business coach. Since 2001, Jason has been reverse-engineering the Google algorithm as a self-taught student and practitioner of SEO and search marketing.

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