The best-performing companies worry less about performance and more about their
organizational capabilities” (Bititci, 2015)
Financials, while a clear indicator of performance, don’t provide you or analysts with an
organizations’ bigger picture. The bigger picture is inclusive of criteria such as people, planet
and profit. With people and planet being two-thirds of the equation, both driven by identities,
values and beliefs, I certainly agree with the above-noted statement. There is a level of
organizational capability and culture required in order to push a well-performing organization
towards becoming one of the “best performing companies”.
Workplace culture is the environment formulated from the interaction of employees in
the workplace. The culture gives a sense of collective identity to all the employees in the
organization, creating values and beliefs that go beyond personal aspirations (Kumar, 2016).
Some elements of culture include values, ethics, beliefs, responsibility and organizational
norms. Positive workplace culture allows for employees to feel recognized and valued by
leadership and thus potentially strengthens employee-management relationships, allowing for
business to “flow” more smoothly. Throughout Kumar’s 2016 study, it was concluded that
positively cultivated workplace environments resulted in less employee turnover, higher
productivity, increased employee morale, and a stronger organizational foundation – which is
important when conducting business in a VUCA environment. Essentially, employees who are
invested in provide long-term benefits for the company, such as loyalty, increased productivity
and increased efficiency all because of the culture.
Financially, Company A is performing quite well with a 19% market share and growing
profits each year – despite the buried costs associated with staffing. It seems that Company A
overstaffs employees for jobs that could be automized while also underpaying them, resulting
in ~10% employee departures associated with compensation within the last year. These
numbers appear to coincide with the arrival of Company A’s newest president. Compensation
aside, employees are offered an annual safety refresher training with no room for additional
learning or growth. In regard to workplace culture, Company A is doing very little to invest in
their employees – both salary and career development-wise; which is likely playing a role in
retention and employee burnout. While the company may be performing well in terms of
market share and profit, it appears largely due to customer satisfaction rather than employee
satisfaction. The financial losses associated with personnel (assuming the costs include new
hires, onboarding, etc.) could be avoided if Company A shifted some of its’ successful customer
service-related behaviors towards investing in a more positive workplace culture for their
employees.
Company B, unlike Company A, doesn’t appear to be as financially positive. Sales have
remained flat over the past few years and there is even a 5% decrease in seat occupancy. Their
president is new to the company and while enthusiastic, she has no prior aviation experience.
She’s committed to empowering employees and introducing visionary ideas; however, Company
B is still experiencing substantial turnover and clear experience gaps. This can certainly be due
to the visionary-nature of the new president as it is a bit contradictory to want to empower
employees (insinuating a focus on workplace culture) while making the decision to partner with
a software company so expensive that it resulted in pay cuts for all employees. That decision,
while forward looking, isn’t conducive of a positive workplace environment. There is also a lack
of HR presence as this department has been outsourced. Who will be advocating for employees
– a third party company that isn’t familiar with the inner workings of the organization? It seems
as if Company B claims to focus on employees but instead focuses on bringing grand changes to
fruition at the cost of employees. If leadership doesn’t care, why would employees? Could
certainly be the reasoning behind the flat financials.
References
Bititci, U.S. (2015) Managing Business Performance. Wiley professional. Reference & Trade
(Wiley K&L) d d
https://wileyplus.vitalsource.com/books/9781119025696.
Kumar, A (2016) Redefined and Importance of Organizational Culture, Global Journal of d
Management and Business Research: Administration and Management. 16(4)
https://globaljournals.org/GJMBR_Volume16/3-Redefined-and-Importance.pdf
