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How does leadership affect culture?

“Culture” is more than just a buzzword that’s cropped up in recent years, it describes a mix of values, ethics, expectations and goals that companies develop over time.

The relationship between culture and leadership is therefore extremely important; especially as a company grows. The beliefs of the staff and the value of their work will shape attitudes and behaviour, ultimately affecting organisational culture.

A positive culture therefore forms when companies have a bliss triad of happy employees, productivity and profit. According to a study by Marketing Innovators, companies with satisfied employees outperformed competitors by 20%, and this happiness attributed to 12% more productivity. As analytics from Gallup outlines, culture is just as important in terms of finding talented individuals to take your business forward – “culture wins getting great people” and organisations with a culture that attracts high-talent could see 33% higher revenue.

Developing a positive workplace culture: The importance of good leadership

Values can be shaped by all members of staff so it’s very important for leaders within the businesses to inspire, setting out a vision for the future and a clear strategy for success. Staff will therefore know where the company is headed and better understand their role in helping that vision become a reality. Of course, it’s not just owners, directors, managers, team leaders or supervisors that can lead at work. Employees demonstrate their own values through their actions, and by inspiring people to lead by example, accepting accountability and responsibility, each individual will help cultivate a positive organisation culture.

Acknowledging signs of negative leadership

Unhappy employees are disengaged at work, leading to negative attitudes and low productivity. This will affect a company’s bottom line whilst negatively impacting on its culture. Towers Perrin backs this up, finding businesses with low levels of employee engagement had a 33% annual decline in operating income, and an 11% annual decline in earnings growth. Below we’ve outlined 10 important warning signs that can contribute to a negative corporate culture:

  1. Poor internal communications
  2. Micromanagement
  3. Lack of empathy
  4. Vague objectives and poorly set goals
  5. No engagement with employee development
  6. No strong sense of purpose
  7. Poor office discipline
  8. No flexibility
  9. Tired and overworked employees
  10. Broken promises

A positive workplace culture helps to attract talent, drive engagement, boost performance and increase happiness, but it’s impossible without good leadership. A leader needs to communicate and interact with employees, celebrating and recognising their individual achievements, whilst outlining the company’s mission, vision and values. It’s therefore important to ensure that leaders take the time to step back to evaluate and define their culture, whilst appreciating the impact it can have on the growth and sustainability of the business.

Here at GBS Corporate Training, we provide a wide range of Management and Leadership Courses, to inspire your teams to grow profitability, maintain employee engagement, drive high performance and uphold their corporate brand whilst delivering their own projects.

Please speak with our training experts today on 01252 618 400 and we will help you find the right solution for your business, ensuring you build a culture of continuous improvement.