14 Signs of a Bad Company Culture and How to Improve
In today’s job market where candidates hold the upperhand, a solid company culture is crucial to closing the deal. Not only that, but a winning culture improves employee engagement, leading to better retention and higher rates of productivity.
Your culture can either be your greatest strength or your most harmful weakness. The trick is to be vigilant against the signs of a bad company culture and work to improve them. In most cases, it only takes five steps to change your company culture.
Read on to learn the 14 telltale signs of a bad company culture.
Bad Company Culture Examples
- You don't have a list of core values
- There's a lot of gossip in the office
- Unfriendly employee competition
- Employees are tardy or absent often
- Employees don't take lunches and work late often
- Still hiring for culture fit
14 Warning Signs of a Bad Company Culture
A strong company culture is important for your company’s longevity and business success. In order to build an exciting culture that will entice job seekers and retain employees, you need to be thoughtful with the type of organizational culture you aim to create. Be vigilant against the following company culture red flags to allow a positive work environment to flourish.
1. You don’t have a list of core values
The Problem: Perhaps the most concerning sign of a bad company culture is a lack of company core values. These are the driving force of an organization — not having core values means your culture is likely to progress without any sense of direction. Unwanted subcultures will form and undermine your business’s success.
How to Fix It: Draft and publish a list of core values. These should be the set list of ideals that truly matter to your team and will help you achieve your goals. Before promoting them to the rest of the team, ensure C-suite executives, HR representatives and long-term employees are aligned on core values. Then, go over each value with the rest of the team. Doing so will help elicit positive behaviors and attitudes, creating a cohesive company culture. Refer back to your core values during the hiring process to ensure each employee you onboard shares the same values as your team.
2. Your managers don’t follow the core values
The Problem: Employees look to managers for direction. If senior and middle management aren’t abiding by the core values you’ve set forth, employees will follow suit. Even worse, they’ll begin to distrust leadership for exempting managers from the office rules. Authority will be discredited, and a clear divide will form between leadership and the staff.
How to Fix It: Lead by example and hold everyone accountable. Core values are important to your culture and your success as an organization, so ensure they are upheld by every member of your team. Holding all employees to the same set of standards will foster an open culture based on equality. This will also help promote your core values across all departments so they become ingrained in your culture.
3. You hear a lot of gossip around the office
The Problem: It wasn’t cool in middle school, and it certainly isn’t appropriate in the office. Gossip leads to unwanted cliques that divide your workforce, turning employees against each other and creating a culture of distrust.
How to Fix It: If you’re noticing that the rumor mill is churning more often than not, address the situation head on. Try to identify the individuals who seem to be involved most frequently and speak to them one-on-one. You should also formally address the entire company so every employee knows this behavior will not be tolerated
4. You have a high rate of turnover
The Problem: High turnover is almost always a guaranteed sign of a bad company culture. Not only will a bad culture drive employees away, it will also deter job seekers from taking your organization seriously; over one-third of U.S. employees say they would turn down the perfect job if they thought the culture wasn’t a good fit. If you’re saying goodbye to employees left and right, they’re probably looking for a less toxic company culture.
How to Fix It: It’s time to double down on your company culture strategy. In order to do that, however, you need to understand the root of the problem. Probe employees during exit interviews on their reasons for leaving. Try to understand what it was about your culture that frustrated them and which aspects they found difficult to part with.
Then, talk to your current employees — especially long-term employees — to get a sense of what’s kept them around. Consider conducting an employee engagement survey and carefully analyze the results. Once you know what you need to improve, act on it.
5. You notice unfriendly competition between Employees
The Problem: Healthy competition is good for business. It motivates employees and encourages stellar performance, which can help grow your company. However, having competition as the focal point of your culture will breed animosity between employees.
How to Fix It: If you see that individuals are highly competitive with one another, you may be placing too much value on performance. Of course you want your team to be full of top performers, but you also want your team to be full, period. Pitting individuals against each other will frustrate employees and undermine their value as individuals.
To avoid sending great employees packing, start recognizing performance on a broader scale and outside the confines of monetary rewards. Encourage managers to recognize their direct reports’ effort and reward their achievements with prizes centered on wellness, such as a comped fitness class, gift card to a favorite restaurant or an extra day off. Additionally, create a platform for individuals to congratulate and thank their coworkers for a job well done. This will motivate employees and encourage a team-oriented mindset.
6. Your employees are often tardy or absent
The Problem: Excessive tardiness and/or high rates of absenteeism are clear signs of a poor company culture. Your employee’s tardiness should tell you that they’re either lazy — a negative quality that will hurt your culture — or disengaged. Similarly, if employees are frequently out-of-office — with remote or flex-schedule employees being the exception — they’re likely disinterested and not passionate about their work.
How to Fix It: For starters, ensure that middle and senior managers are prompt at the start of the day. Employees learn from managers, so if one manager routinely shows up 30 minutes late, their direct reports will believe they can do the same. From there, talk to the repeat offenders about their work schedule. It’s possible they have a regular conflict — such as dropping their kids off at school or commuter restraints — that merit an adjusted start time.
Engage your HR department to improve how your team tracks sick days, doctor appointments and other approved absences. Of course, you should be open to discussing personal matters and extenuating circumstances. Together, these approaches will help improve your absenteeism rate and create a positive work culture that prioritizes communication.
7. You prioritize perks and benefits
The Problem: A ping pong table and catered lunch will boost morale for a while, but it won’t keep your employees engaged. The benefits and in-office perks you offer employees should be reflective of your company culture, but they don’t make up your culture. As soon as the novelty of a perk wears off, you can’t guarantee your employees will stick around.
How to Fix It: By no means should you devalue your benefits package. Instead, simply put more emphasis on cultural initiatives like forming a diversity and inclusion committee, hosting company-wide potlucks and implementing more regular feedback sessions into your processes. These initiatives will foster a strong sense of community and demonstrate each employee’s value to the company.
8. You don’t recognize half the people in your company
The Problem: For larger companies, it’s likely you won’t know everyone’s name, especially if your team is growing rapidly. However, if you don’t even recognize some of the people walking around the office, you probably aren’t interacting with your staff or peers nearly enough. This leads to a disjointed culture where employees feel more like cogs in the machine than valued individuals.
How to Fix It: Make a point to engage with your team regularly. Forming a relationship with employees helps them view leadership as friendly and approachable, which encourages two-way communication. Host lunch and learns, participate in work happy hours or chime in on email threads when you can. You can also implement a monthly all-hands meeting to increase transparency between leadership and staff.
9. Your employees don’t — or rarely — take lunch breaks
The Problem: If employees are often working through lunch, it’s either because they feel they don’t have time to stop working, or they believe management doesn’t condone taking breaks. Not only is that poor business logic — 81% of employees who regularly break for lunch want to be active members of their organization — it’s also a surefire way to turn employees away. Expecting that employees will perform well while working eight hours nonstop is ridiculous. Moreover, it signals to them that leadership only values their work output, not their contribution to the culture or personal commitment to the organization.
How to Fix It: Simply encourage lunch breaks. Start by taking lunch yourself, and remind employees to enjoy their break time. Occasionally providing food for the office is a great way to impose a midday break, get to know your team and allow employees to socialize with their peers. Additionally, make a point to inform new hires of how long they’re allowed for lunch. Otherwise, they may avoid taking a break altogether.
10. Your company has a bad rap
The Problem: Anonymous review platforms have increased visibility into any company’s culture. If you have a positive work culture full of highly engaged employees, this only helps your case with prospective candidates. However, if your team is frustrated with the management style, cut-throat competition between peers or discouragingly high turnover rate, job seekers will be the first to know, and your company will earn a harmful reputation as a result.
How to Fix It: Build out your employer branding strategy. While you can’t control the public’s perception of your company, you can help shape the story. Of course, it’s important to build an accurate employer brand, which can only be done if you first create an exciting workplace culture.
11. Your employees aren’t adequately acknowledged and rewarded
The Problem: If you only recognize the top sales rep of each quarter, you’re doing your culture a disservice. Only occasionally rewarding a few individuals will make the majority of the workforce feel undervalued and underappreciated. It can also lead to a negative culture founded on competition and animosity between employees.
How to Fix It: Talk to middle and senior managers about instituting more feedback sessions with their direct reports. They can use this time to provide constructive criticism and acknowledge the individual’s great work. Additionally, carve out time in your monthly all-hands meeting for employees to recognize and appreciate other team members and implement regular employee spotlights. Providing positive reinforcement motivates individuals and this format allows employees to form meaningful connections with their peers.
12. Your employees routinely work late or on the weekend
The Problem: If the work day ends at 5:00 p.m. but the majority of your team regularly stays well past, that should be cause for concern. This indicates that your team members are either juggling too many responsibilities or managers have unrealistic expectations for their direct reports. Quotas help ensure your growth plan stays on track, but impractical objectives can lead to employee burnout.
How to Fix It: To avoid unnecessarily overworking your employees, talk to managers about reassessing workloads. Ensure every individual has enough responsibilities to be challenged and productively contribute to business success without leading to burnout. You may also need to evaluate the entire team’s demands — if every individual is running ragged at work, there may be room to hire another employee to share the workload.
13. You still hire for culture fit
The Problem: Of course you want every member of your team to feel like they belong in your company culture, but hiring for culture fit is an outdated recruitment strategy that will cost you top talent. When you seek out carbon copies of your current employees, your culture will remain stagnant or start to decline. Like-minded individuals are great at agreeing, but tend to butt heads when it comes to pushing the envelope.
How to Fix It: Start to hire for culture add. This approach ensures that you bring on candidates who will connect with your team on a meaningful level. Culture adds are individuals who share your core values and are passionate about your mission but bring a unique background, perspective or experience to the team. Following this strategy helps build a diverse and inclusive culture where individuals from all walks of life are welcome.
14. You’re working in communication silos
The Problem: Lack of communication is a solid indicator that a company has a bad culture. Whether it’s across teams or between managers and direct reports, the way information does or does not flow can impact a company’s culture as well as its bottom line. When employees aren’t communicating properly, it can hurt productivity, stifle ideas, and create a less desirable working environment.
How to Fix It: Utilize team building activities and company-wide initiatives to get teams talking and working together, even if it’s not work related. Breaking down these initial walls between teams and even within teams can help information flow better when it comes to everyday work. Additionally, creating open-door policies at the leadership level can work wonders for communication. When engagement and transparency is encouraged from the very top, information is less likely to get trapped. It can be difficult to abandon the styles of communication cemented in a company's foundation but it’s worth the work.
Your company culture isn’t a one-and-done deal. Even after you address these 14 signs of bad culture, you should routinely check in on your organizational culture and see what improvements can be made. You can gauge the strength of your company culture by measuring employee engagement and regularly asking your team for feedback. Remember that your hard work will pay off in the long run, so don’t shirk your company culture responsibilities.