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Why Toxic Cultures Are More Costly Than You Think | EPI Blog Series

culture leadership toxic turnover work-life balance Apr 05, 2022

Turnover & Toxic Cultures

As employees and employers alike look to creative solutions to plug holes left in the wake of the Great Resignation, we continue to find the importance of organizational health rising to the top of the list. But why are so many employees leaving at such rapid rates? Are there steps employers can take to become more attractive to job seekers?

With some estimating more than 40% of employees considered leaving their job in 2021, what factors influence people out the door and into a new opportunity? Donald Sull, Charles Sull, and Ben Zweig found the following factors contributed most to employee turnover during the Great Resignation:

Toxic cultures are by far the strongest predictor of employee turnover. Another contributing factor would be the growing divide in priorities and expectations between employees and employers. New research from McKinsey & Company suggests, "Employers seem to overlook the relational elements that are key drivers for why employees are leaving, such as lack of belonging or feeling valued at work. Instead, employers over-index on transactional factors, which are not primary drivers."

As leaders look to retain and attract top talent to the teams and organizations, this divide between workplace expectations and the lived experience of day-to-day operations is critical to understand. Leaders looking to get a leg up in times of change should lean into their purpose to light the way forward, and that purpose must connect with the people that make up the organization. 

There are easy steps leaders can take to address the tension. One way to increase trust is to check in with your team regularly. If you feel overwhelmed or burnt out, the people around you likely are too. Building compassionate cultures isn't easy, but the effort to create such a workplace community will pay dividends down the road. 

Putting People First

The reality is that seeking to value people solely in transactional terms is not the tremendous motivating force we once thought. Money will not entice your employees to stay, especially when the organizational culture is not providing the support or meaning they may be looking for from work.

When understanding employee attraction and retention, it's vital to listen to the values of employees coming into a team. For employers, do their values match the organizational values that you hold dear? Employees should be asking the same questions of themselves. Finding this alignment will significantly accelerate the synergy between organizational goals and the people working to reach them.

Toxic cultures are exceedingly costly, but healthy cultures will steady the ship amid the wild seas of change. The necessary conversations that uncover the driving forces behind decision-making practices or unhealthy cultural arrangements are incredibly complex and challenging. However, the reward comes in the groundwork laid; the trust slowly strengthens due to genuine care.

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