Oct 25, 2023
What Is The Cost Of Doing Nothing About Your Workplace Culture?
In this episode, we examine the hidden costs that come with typical workplace culture challenges. We call these additional expenses and productivity wastes Labour Value Loss, and they eat away at profits and potential in almost every business.
Our prescription for this episode: understand that doing nothing about these everyday challenges comes at a steep cost, whether you are aware of the problems or not.
Statistics referenced:
On average, companies are running at 33% efficiency.
- Gallup. Treat Your People Like Assets, Not Expenses -- Invest in Them (2019)
The result of 22 case studies show a typical cost of turnover of 20% of salary.
- Center for American Progress. There Are Significant Business Costs to Replacing Employees Report (2012)
The cost of burnout-related absences and lost productivity can be close to 25% of an employee's annual salary.
- Morneau Shepell. Morneau Shepell's Annual Mental Health Index (2022)
The relationship between Sexual Harassment and reduced productivity has been directly established. A person experiencing Sexual Harassment losses productivity equivalent to 45% of their annual salary.
- Willness, Steel & Lee. A Meta-Analysis Of The Antecedents And Consequences Of Workplace Sexual Harassment. University of Calgary. (2007)
An uncivil workplace (where microaggressions and rude/passive aggressive behavior are common) can reduce employee performance to a cost of $14,000 annually, or about 26% of the average annual salary.
- Pearson, C., & Porath, C. The Cost of Bad Behavior: How Incivility Is Damaging Your Business and What to Do About It (2009)
Research by Grammarly and The Harris Poll found poor workplace communication is a pervasive problem burdening businesses and employees alike costing businesses approximately $12,506 per employee every year or 21% of that average employee's annual salary.
- Grammarly and The Harris Poll. State of Business Communication report (2023)
The need for additional wages to make up for a poor reputation as a bad employer, businesses need to spend about $4,723, or at least 10% more, per hire to convince a candidate to take a job at such a company.
- Harvard Business Review, A Bad Reputation Costs a Company at Least 10% More Per Hire (2016)
About Our Hosts!
James is an experienced business coach with a specialization in HR management and talent attraction and retention.
Coby is a skilled educator and has an extensive background in building workforce and organizational capacity.
For a little more on our ideas and concepts, check out our Knowledge Suite or our YouTube Channel, Solutions Explained by Roman 3.