Why do some companies and organizations outperform others? Why is it that some organizations experience less turnover and higher employee satisfaction while others seem to struggle with these continuously, covid or no covid?
The answer has been suggested to lie in organizational culture: the tacit principles that guide how people behave in organizations. Intangible in nature, and difficult to identify and duplicate, organizational culture has become the competitive advantage above others as most work turns into distance work and turnover becomes an urgent issue in need of addressing in most boardrooms. The value of organizational culture has been linked with several organizational benefits, including productivity, a positive communication climate, higher flexibility and increased innovativeness. Studies suggest organizational culture to explain up to 28% of customer satisfaction, and organizations with positive organizational cultures may perform up to 30% better than those without.
Looking at some recent findings from work psychology research, it appears that the psychological contract is changing for the workplace. Employee expectations have changed, and distance work has made the costs of switching organizations and positions smaller. This is an issue for organizations, as voluntary turnover has been proved to be contagious in workplaces; when one colleague leaves, others start updating their resumes. In addition, getting out of a downward spiral of contagious turnover is more costly than investing in keeping employees happy.
Leaders shape the emotional climate of an organization. Certain positive emotions have been proven valuable for organizational culture: feelings of safety, trust, belonging, excitement and surprise have been linked to better organizational performance and increased innovativeness and teams’ problem solving abilities. For CCOs looking to improve their organizational culture, the question remains: what kind of emotional experience do our employees have? What actions can we take to increase the positive emotions among our employees?
There is no one universal good culture, but building an ideal organizational climate depends on the organization, its context, industry and individuals. Interestingly, certain controversial emotions in manageable doses can also contribute to better organizations: some forms of envy and inadequacy have been linked to improved employee performance. On the other hand, certain emotions in workplaces have been associated with poor organizational performance: feeling left out, uncertainty, confusion, shame or fear seem to hinder organizations from ideal performance. In uncertain times such as pandemics and wars, these emotions become increasingly common. If these emotions are gaining ground, it is the task of the CCO to intervene for the best interest of the organization. This task ideally requires collaboration with other functions, such as HR or IT.
A useful concept for understanding what organizational culture consists of is emotional agency. It has been linked to workplace efficiency and worker welfare, and could contribute to workplace commitment. Emotional agency includes factors that can be built and developed, such as sense of influence over own work. The level of influence that workers have over their own work is a well studied phenomenon, and lack of influence has been linked with burnout and depression. What matters most is the perceived influence, and employees in similar situations may perceive their influence differently. This is something communication can fix, by listening to the employee experiences and ideas for improvement.
On some levels the pandemic has enabled new levels of agency for employees: the more an employee feels they have a say over their own work, whether it is timing, workload, space, pace and collaborators, the happier they seem at work. If employee complaints emerge on the topic of having little say or control over their own work, CCOs should listen. Solving this challenge could prove valuable and mitigate major risks of employee turnover. As it is a matter of perceptions, sometimes it can be fixed via surprising adjustments outside the usual HR guidelines.
As mis- and disinformation increase in society, a good organizational culture becomes a shield for employees, brands and organizations. The better defined the organizational character, the easier it becomes to distinguish fake and false content about the brand or organization.
Building and nurturing organizational culture and the emotional climate of workplaces is a timely topic for CCOs and organizations. If left unattended, information pollution will take over and tell the worst. At best, strong organizational cultures pay off but can also contribute to the benefit of entire societies, and even help keep the communication climate clean beyond the organizational boarders.
Vilma Luoma-aho is Page Member since 2015, and professor of corporate communication and past Chairman of the Board of the Finnish Communication Association ProCom. She chaired Page’s the first online Spring Seminar in 2020, and has a background in agency work and public sector communication. Currently in addition to research and teaching, she works with companies to develop their stakeholder relations and intangible assets in an era of misinformation. She has won prizes for the applicability of her research, and her newest books focus on the changing expectations of digital stakeholders.
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