This is a loop: happy employees create happy clients who create good profits.

Say it to yourself every morning and work consistently to create the company culture to challenge, engage and reward employees. You and they will be pleased with the results.

Years ago I worked with a company owner who insisted that a continued focus on the bottom line would produce a healthy company culture.  After three decades of working with high-end remodelers around the country – and more importantly with those who aspire to be known as high end remodelers – I know just the opposite is true:

Build a strong company culture where employees are challenged and rewarded, and the company can succeed beyond your wildest dreams.

Culture is defined as values, principles or beliefs held by a society; society is defined as ‘people’ or ‘group.’  So it follows that a company is a group and as such has values.

The big question is:  what are those values?  And how are they shown in practice?

Evidence of a weak company culture includes:

• High employee turnover
• Gossip and innuendo among employees
• Ineffective and insufficient communication between production and office
• No clear understanding of company mission
• Internal cliques or factions; silo-mentality.

The results can be profound: loss of sales and decrease in gross margin; internal chaos and communications breakdown between marketing and sales, production and office.  The owner feels out of control even when the company is not in growth mode.

Here are a few examples of what successful leaders do to develop a healthy culture:

• State of the Union Address – this annual or bi-annual company-wide meeting celebrates projects and people from the past year and establishes a few important “change initiatives” for the next 6 or 12 months: this helps employees understand the company goals for the future and how they can impact company success.
• Lunch and Learn – a regularly scheduled bowl bag lunch led by one employee to teach a skill or process to other team members: this recognizes highly skilled employees by giving them a forum to help other employees succeed.
• Company book club – each team suggests a short work related book to be read and discussed over the next few months. This exercise encourages discussion and opens avenues for employees to bond.
• Summer picnic and winter holiday dinner – good company culture offers opportunities for fun, relaxation and recognition.

These extra-curricular activities can go far to increase employee loyalty and attachment to the company, but they are only one leg of the stool. The other 2 are basic structural HR elements: wage and benefit packages slightly above area averages, metric based job descriptions coupled with regular performance reviews, standardized hiring, onboarding & training processes.

Finally, a vital element of company culture is equity – all employees must have a sense of being fairly treated at all times. This means that every owner must become as adept at firing as hiring. Firing is an important part of being a company owner, or a grown up for that matter. If you take issue with that statement then you should read “Crucial Conversations” and “Crucial Confrontations.” The ability to manage difficult conversations whether with employees or friends and family is part of being an adult.

Want more?

To see how one company makes employee happiness part of their initial introduction to the public, go visit hammerandhand.com and look just below the fold.

And if you’re really serious about becoming a great leader, then go register for this year’s Remodelers Summit right now. Then, after you’ve registered, I want you to go take care of your employees!