Positive Culture Breeds Success

I was saddened when I heard that a landmark store in downtown Kingston, Ontario was closing. S&R Department Store employs 80 people, is located close to Lake Ontario in a four-storey building built in 1820 with 60,000 square feet of space, and has been in the retail business since 1959.

S&R is also located right across the street from my office, making me a frequent shopper.

I’ve listened to all the reasons cited for its closing and I believe that one or two of them may have been the proverbial “straw that broke the camels back”, but the company was ailing long before that time.

The organizational culture at S&R did not appear to be nurturing. As a customer, you could frequently hear staff complaining about one thing or another. Many of the staff who I knew were lovely people, although not particularly driven to make a sale. They didn’t invest themselves into the business. They lacked commitment and passion–maybe because it was not welcomed by management. The end result was that they just didn’t seem to care. The employees reflected the organizational culture that existed.

Economic times are such that if you don’t have a thriving organizational culture, it will be tough to survive. Even though our economy will rebound fairly quickly, there are other mitigating circumstances that drive home the importance of a healthy organizational culture. Retiring Baby Boomers, for example. For every two retiring, there will be only one replacement worker, increasing mental-health concerns (stress) which causes lost time at work. Globalization also causes work to be transferred to countries with lower wage rates and high education levels. All of these factors combined indicate that in the next five to 10 years, only those companies with a healthy organizational culture will thrive.

Organizations that wait too long to shift will lose some key personnel to more pleasant places to work. It’s not about money. It’s about choice. What environment would you like to spend the bulk of your waking hours?

Remember the poaching of key staff that occurred during the dot.com boom? Those days are returning. If your culture is not healthy your key staff will be attracted to your competitors and this time it will not be just the technology sector involved. Poaching will transcend all sectors. Police officers, nurses, construction workers, professionals and customer service talent will all be involved. You may train your staff, but if you do not create an environment in which they can grow, contribute, and be innovative, they’ll leave, or, in the case of S&R, become uninspired or uncaring. Your bottom line will be impacted with plummeting sales and service.

The writing was on the wall with S&R Department Store. Look at your wall. What is written? Is it something you might want to change?