O.C. Tanner’s Global Culture Report: How pats on the back can improve workplace culture

The O.C. Tanner Institute's recently released 2021 Global Culture Report clearly found that recognition makes a difference — especially these days.

O.C. Tanner’s Global Culture Report: How pats on the back can improve workplace culture

With great leadership comes great responsibility to make recognition a priority in your organization.

The O.C. Tanner Institute's recently released 2021 Global Culture Report — that looks at the impact crises, technology, recognition, inclusion, leadership and a new generation of workers will have on workplace cultures — clearly found that recognition makes a difference, especially these days. When some organizations decided to put recognition programs on hold at the beginning of the pandemic, “it didn't turn out so well,” says Meghan Stettler, director at the O.C. Tanner Institute.

“Not only did we see a 14% increase in mental exhaustion, we also saw a 49% decrease in engagement and a 20% increase in intention to leave.”

The report suggests companies currently have “a great opportunity to clearly communicate they care about their employees overall wellbeing by, for example, doubling down on recognition and other expressions of appreciation that can really solidify connections that are going to be critical especially as we continue to ask people to adjust and adapt to the ongoing challenges ahead,” says Stettler.

This year, the global culture study was expanded and more than 40,000 people were interviewed, participated in focus groups or were surveyed, and the institute ended up with 13.3 million data points to analyze. The result was a very interesting picture emerging on the impact of COVID on organizations’ culture, including with respect to the initiatives many have implemented to try and improve it.

Recognition ties nicely into what culture is made up of: stories, values, heroes and shared commitments with each other, to name a few. Organizations need to lean in to these aspects, says Dr. Alex Lovell, director, research and data science at the O.C. Tanner Institute. If anything, the pandemic showed business leaders the true value of their people and the importance of acknowledging their sacrifice and resilience during an unprecedented time.

“Every organization has emerging heroes — people who have stepped up to do something extraordinary during this time,” he says. “Share the story. Share impact on customers — how the organization continues to achieve its' purpose. Share stories about how we continue to be ourselves, no matter if it is in person or remote.” 

This becomes even more critical as companies continue to operate with hybrid working models. With the trend towards greater remote and flexible work options here to stay, employees and their leaders have had to interact more with each other by directly reaching out. While this may mean more meetings, it also means employees are reporting stronger connections with people both within their teams and in other areas of the company.

Lovell recommends organizations “reserve cultural focal points, like town halls and other types of celebrations where culture is felt” and amp up that crucial recognition. 

“Bring the celebratory tone to virtual work — best practice recognition includes ensuring the accomplishments of employees are known, and celebrated, by others. Round up people virtually and deliver recognition, integrate a fun background, connect accomplishment to purpose and encourage others to also recognize.”

David Sturt, EVP of the the O.C. Tanner Institute and marketing, found the results around the pandemic’s impact on companies with either strong or lacking cultures “incredibly profound.”

While it stands to reason the pandemic has affected all companies negatively in some way, those that met the institute’s “thrive” threshold experienced a markedly less drastic hit. For example, Sturt notes there was only a 1% and 2.6% drop in engagement and retention respectively, and the employee net promoter score was down 5%. Sense of belonging fell 1.8% and inclusion by 1%. He says while each of those losses has an effect, the companies without robust cultures fared far worse. For those same data points, they faced a 52% drop in engagement; 53% in retention; 63% in employee net promotor score; and 51% in inclusion.

“Think of the impact on those employees not only dealing with COVID but dealing with the effects of a culture that does not wrap around them and does not help them feel included. That’s important and that’s important to understand."

Another trend Lovell found interesting was how the crisis forced senior leaders to increase their visibility among their employee population. Things like video messages, higher frequency of town halls and increased communication generally put a more "human" face to senior leadership, and what came through in the report was that shift had a profound impact on employee perceptions of those leaders.

“We have seen a dramatic change in how people reference and talk about their senior leadership,” Lovell says. “Prior to COVID-19, the most common way people referred to their senior leadership was ‘management,’ which was also often associated with negative sentiment. Now, ‘our leaders,’ ‘my senior leader,’ has replaced ‘management,’ with greater positive sentiment associated with that change.”

As organizations moved to adapt quickly to great uncertainty, everyone had to reevaluate priorities and make changes to the way they interacted with others and how they would do business going forward. The pandemic saw senior leaders shed some aspects of that harder management aura they have traditionally sought to project and became more relatable to their workforce in the process. It has cultivated a greater sense of connection and trust within the workforce to their leadership, and that in itself is a positive change.

Stettler says leaders who practiced radical transparency — “or in other words told the truth, the whole truth and nothing but the truth and told it often,” she explains — made great strides in connecting with their people even during these tough times.

“Organizations that increased transparency since the start of COVID saw an 85% increase in employee engagement, a 174% increase in trust in leadership and a 241% increase in employee net promoter score.”

Another critical component of strong cultures is inclusion, a hot topic of late on the world stage with widespread protests against racial discrimination — people calling for equality, for respect and for action, Sturt says. At the company level, there’s still a lot of work to do to both eliminate the exclusionary kinds of behaviours that are still present and increase the level of inclusion.

The data shows a persistent level of negative experiences around discrimination in the workplace in some form, whether blatant or more subtle micro aggressions. While everyone has been working hard over the years to reduce those incidents — and Sturt notes there is headway being made — the report found exclusion and inclusion were not just two sides of the same coin, meaning just because exclusionary kinds of behaviours are successfully dialled back doesn’t mean that automatically creates an inclusive environment or culture.

“They were in fact two different dimensions, so as each of us are working hard to improve diversity and inclusion in our workplace cultures we need to take both sides into consideration,” Sturt says. “We have to approach the other dimension. What can we do to amp up the kinds of inclusion behaviours, attitudes and mindsets to help make it truly a more inclusive culture?”

Stettler adds that the data also shows the various D&I strategies enacted in the past have fallen short. In fact, 44% of respondents said the D&I efforts in their workplaces feel insincere.

“Companies have often focused on surface-level issues and challenges that don't end up changing or improving the daily interactions that employees experience,” Stettler says, adding this is no longer a risk mitigation strategy — it’s critical employers create a culture that embraces and celebrates their workforce in the context of every day employee experiences.

For Sturt, one of the overarching takeaways from the data was that the role of leaders is one of synthesis — of bringing together and connecting people to the purpose of the organization, to accomplishment and to each other in powerful new ways. It’s a role of helping them understand how important those things are to each one of us.

“As we look out across this new decade, I don't think it’s going to get just suddenly a whole lot easier,” Sturt says. “I think we have to use opportunities like the one we’re in right now to take more aggressive steps to improve our cultures, to create the kind of thriving culture that will take us fully through this next decade and beyond.”

For more information, observations and insights from the research, download a copy of the 2021 Global Culture Report or watch O.C. Tanner’s annual company culture conference Influence Greatness 2020 streaming free until December 31.

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