Get All Access for $5/mo

Toxic Workplaces Burn Cash and Crush Morale — 7 Ways to Build a Culture Everyone Wants to Join Having worked for almost two decades in the hiring industry, here are ways to create a company culture that will retain your top talent, save you money and help your business grow.

By Lesley Pyle Edited by Kara McIntyre

Key Takeaways

  • A negative company culture with a high employee turnover rate can lead to significant financial losses and damaged morale.
  • Positive work environments that prioritize learning experiences, recognition and growth opportunities can significantly improve employee retention.
  • Strategies such as leading by example, empowering employees and promoting work-life balance are essential to fostering a company culture that retains top talent and ensures business longevity.

Opinions expressed by Entrepreneur contributors are their own.

We have all heard the jokes online that if someone puts in their job listing that "we will treat you like family," you should run away — that is the last thing that a company will actually do. To be completely transparent, I once consulted with a friend who worked with a company that said this, and they had an extremely high turnover rate.

Employees at this company called and sent Slack messages at every hour of the day. The manager expected the employees to be available 24/7 even though the company itself operated with normal 9 to 5 hours. The manager would host a team meeting every month where they called out every single person on the team to tell them what they did wrong throughout the month — in front of everyone else. Achievements were never acknowledged in these team meetings.

On the other hand, my friend also worked with a different company whose employees absolutely adored the work culture. If you made a mistake, the business owner acknowledged it and helped you understand ways you could improve in the future. There was never a punishment or scolding involved. She encouraged everyone to use it as a learning experience.

She also recognized people's strengths and would actively approach them about other opportunities. For example, she noticed one employee who was originally hired to answer the phone had an affinity for numbers and enjoyed budgeting. With a lot of encouragement from the team and a little training, that receptionist moved up to inventory management.

All jokes and internet memes aside, the culture at your company can make or break your business.

Related: How to Create a Workplace Culture Where Everyone Feels Like They Belong

The cost of bad company culture

According to the Society for Human Resource Management, it can take up to 6-9 months worth of an employee's salary to find their replacement. That means losing a $60,000 employee can cost you up to $45,000 trying to find their replacement. Just to put this into perspective, that aforementioned company with the horrible work culture had an average six-month turnover rate for a team of 15 people. Let's say they were all salaried at $60,000. That means every six months the company was essentially burning $675,000 — which adds up to $1.35 million per year. As you might have guessed, that company went out of business.

Of course, company culture is far more than money. Morale, performance and finding top talent all take a hit with a lackluster workplace atmosphere. Without positivity and recognition of successes, employees feel as though they can never do anything correct, which leads to low morale and, in turn, low innovation and enthusiasm for the job. If someone does not care about their job, they will not do it well, leading to external issues for the company such as poor customer service and missed deadlines. And if the company is not able to innovate in our fast-paced ever-evolving world, the business will not survive.

This then leads to employment issues. Companies with a negative reputation will find it difficult to hire top talent because no one wants to work in a place where they are not valued. According to an estimate published by Gettysburg College, the average person will spend 90,000 hours of their lifetime at work — that's about one-third of a person's life. People do not want to spend that time in a place that causes them stress or pushes them to the brink. This includes current employees too; people do not want to work at a place where they constantly fear losing their job; so, many people (once they realize the toxicity of the workplace culture) will quit. This leads to a never-ending, vicious cycle of talent coming and going, leaving the business without a way to grow.

Related: 10 Excellent Company Culture Examples For Inspiration

Create a culture that retains talent

There has been a shift recently where people are not staying at jobs as long as they used to. You've most likely heard of people who worked at the same company for 50 years or more. Nowadays, it's more common than not to hear of someone who has worked for multiple businesses over a span of just a few years. This is due to the kind of work, benefits included and — you guessed it — company culture. Having worked for almost two decades in the hiring industry, here are ways to create a company culture that will retain your top talent, save you money and help your business grow:

  1. Be present. Too many people want to own companies without having to be present to run them. If you do not want to work there, why would your employees want to work there?
  2. Lead by example. Everyone is human, and even artificial intelligence tools make mistakes. Use a mistake or problem as a learning example, and you might even be able to turn it into a marketing opportunity.
  3. Empower employees. Give your employees the opportunities to go further in their careers with training, certifications, etc. If someone wants to improve, help them!
  4. Celebrate achievements. Recognize successes and create goals that lead your team to receive rewards.
  5. Communicate openly. If something is going wrong, it needs to be pointed out. Do so in a professional manner so that the team can address the problem.
  6. Promote a work-life balance. Especially in a remote workforce, people are tied to their devices. Make them take breaks and vacations and set a range of working hours that encourage this balance.
  7. Offer incentives as part of the job package. Benefits play a big role too for potential incoming talent. Look at what your company can offer to entice employees to join your workforce.

Related: How to Create a Work Culture That Can Survive Anything

If you are not sure what to change with your workplace culture, go to the source and ask your employees. Their invaluable feedback will help you create a culture that encourages employees to stay and fosters top talent to grow with the business.

Lesley Pyle

Entrepreneur Leadership Network® Contributor

Founder & CEO of HireMyMom.com

Lesley Pyle began her work-at-home career in 1996 with the launch of her first website "Home-Based Working Moms." She has continued her passion of helping moms and small businesses for over 25 years now. Pyle was named one of “50 Women Entrepreneurs Who Inspire Us” by Self-Made magazine.

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

Editor's Pick

Marketing

Many Brands Risk Being Left Behind By Overlooking These Critical Advertising Steps

Learn how to use smart marketing tools and AI to optimize online advertising and maximize ad spend in today's competitive landscape.

Starting a Business

How to Find the Right Programmers: A Brief Guideline for Startup Founders

For startup founders under a plethora of challenges like timing, investors and changing market demand, it is extremely hard to hire programmers who can deliver.

Franchise

McDonald's Is Launching the Highly Anticipated Chicken Big Mac in the U.S. — Here's When

The sandwich was a massive hit in the United Kingdom, selling out in just 10 days during its limited run in 2022.

Business News

'Love It!': A Town in Connecticut Is Experimenting with a 4-Day Workweek — and It Seems to Be Working

From small towns in Connecticut to large companies like Kickstarter, the four-day workweek is gaining steam.