Is team culture the solution to the great resignation?
For as long as I can remember, employee retention has been a focus of organisations. However, due to the dynamics of the last 2 years, it has become the predominant conversation on everyone’s lips.
One of the fallouts from the pandemic is that talent is thin on the ground, flexibility is the new currency and employees have even more power than they did before.
The harsh reality for organisations is that employees understand the power and choice they have and, if they don’t get what they want, they use their feet to go looking for it somewhere else. Covid made people reassess their life’s priorities, which has caused a lot of team members to resign their jobs. This phenomenon, known as the “Great Resignation” (1), is a real thing, not only in countries like the U.S., where in 2021, 23% of the U.S. workforce quit their jobs (2), but also in Australia, where according to the Australian Bureau of Statistics (ABS) in 2021, almost 10% of Australians quit their jobs (3). This is the highest rate from the last 10 years.
The days of “We call the shots because we pay your wage, are long gone”. Organisations need to be acutely attuned to the demands of their employees or they are going to lose them. Luckily the research in this area is very clear in terms of what employees look for in an employer.
Okay, it’s time to start building a case.
Recently, PWC conducted some research to find out what it is that workers want (4). Employees were asked to rank their Employee Value Proposition (EVP) preferences. At the same time, Senior Leaders were asked to predict what their team members’ EVP preferences were. The results here are fascinating and show a clear disparity between employees and leaders. Employees ranked ‘Working with good coworkers’ as number 1, while their leaders ranked it as number 13.
A study run by Seek(5), reported similar findings with ‘supportive colleagues and good leadership’ being the most important factor for workers. The same study also showed that 2 in 3 people rate it as more important than a higher salary. Additionally, 64% of people said they would turn down a job if they found out that the organisation had a poor culture.
To really drive home my point, an analysis conducted by a Senior Lecturer from MIT, one of the most respected Universities on the planet, showed that people rated team culture 10.4 times more important than salary (6). This shows us that while remuneration is important, it won’t outweigh the benefit of having a great team culture.
The good news here is that there is clarity on what to do in order to keep our teams intact – clearly, have better team culture. The ugly question is how are we going in terms of executing on this?
Well, there is good news and bad news…
The good news is team culture is getting a lot of attention which has benefits for all of us. The bad news is we are making one very big mistake.
Our research with Deakin University overwhelmingly shows that the most relied on strategy by organisations to improve team culture is leadership development. Organisations send their leaders on a course to improve their leadership. Because after all if we fix the leader, you fix the team. That’s how it works right?! Remember, the fish rots from the head down (insert any other cliched leadership sound bite). Easy, right?! Wrong.
By relying on this one strategy, there is a big opportunity we are missing. We are failing to understand and recognise the role that each team member plays in shaping the culture of their team and therefore the culture of the organisation.
Our cultural research project known as “The Ripple Effect” shows that every member of a team has a profound impact on the culture of that team. The name “The ‘Ripple Effect”, references the fact that every behaviour from a team member sends a ripple through the people around them.
Studies into how humans behave show that team members are likely to copy the behaviour of the people around them, whether it’s a positive or negative one. In fact, evidence for “The Ripple Effect” phenomenon exists beyond the fields of Psychology or Sociology. Mathematical modelling and predictive algorithms demonstrate very clearly that each member of a group shapes the culture, mood and behaviour of that group. In other words, everyone effects culture.
Want more proof? Think of a time when you were part of a team and there was that one toxic person who wasn’t the leader of the group but had a huge influence over the mood and energy of the team. In fact, a number of years ago we were working with a team who had an amazing leader that was genuinely working on the culture of the team. However, their efforts were constantly being derailed by a cynical and disruptive team member.
Similarly, we all have stories about the best team we have ever worked in. While that team might have had a great leader, the team members themselves were pivotal in cementing that positive work culture.
The most concerning finding of our research is that the vast majority of research participants don’t focus on, prioritise or even realise their role in shaping their team’s workplace culture. To put it simply, their impact on their own team wasn’t something on their radar. They outsourced that role to the leader of the team. Not in a mean way, just in a ‘that’s not my job’ way. They were not aware of the colossal role they played in driving cultural improvement and achievement of strategy.
Many companies struggle with driving cultural transformation. One of the reasons why is the vast majority of organisations and teams place the responsibility of culture squarely on the shoulders of the leader.
However, it is time that team members were given a more wholistic view of team dynamics and invested in creating a culture that they will in turn reap the rewards of. The way to create a great culture is having leaders and team members working together to build an environment that no one will want to leave.
However, this can be a hard conversation to start, particularly if you are an internal leader. Which is why our “The Ripple Effect” keynote is so popular amongst organisations. As an external person, it’s easy for us to start those conversations and show all parties the simple steps they can take to improve on team culture.
Dr Adam Fraser
References:
1. Term coined in 2021 by Anthony C Klotz, a professor of management at University College London's School of Management
2. Cengage Group. 2023. Where Are They Now? The Great Resigners, One Year Later.
3. https://www.abs.gov.au/statistics/labour/jobs/job-mobility/latest-release
4. PWC. 2021. The Future of Work. What workers want: winning the war of talent.
5. Jennings, Melinda (SEEK). 2023. Workplace culture: What employees are looking for in 2023.
6. https://sloanreview.mit.edu/article/toxic-culture-is-driving-the-great-resignation/