Tag Archives: Workplace Trust

Purpose: A Hedge Against Organizational Challenges

Data Point Tuesday

The Deloitte “2014 Core Beliefs and Culture Study” proves it again, that those workplaces who focus on creating a meaningful environment for all their stakeholders (customers, employees, and communities) foster a culture of purpose that builds confidence, drives investment, and “can lead to competitive advantage in a time of economic vitality.” The survey was conducted in February of this year and is designed to explore the concept of workplace culture, defined by a set of timeless core values and beliefs, as a business driver. This year’s survey looks specifically at whether a strong sense of purpose leads to higher levels of confidences among stakeholders and drives business growth. Methodology included the survey of a sample of 1,053 adults (300 executives and 753 employed adults) employed full time within an organization with at least 100 employees.

Evidence from the survey indicates that focusing on purpose rather than profits is what builds business confidence. What do organizations define as purpose though? When respondents were asked about activities that are part of the purpose of their organization, the top 5 cited answers were:

  • Providing business services and/or products that have meaningful impact on clients/customers (89%)
  • Providing business services and/or products that benefit society (84%)
  • Providing employees with education, experience, and/or mentorship benefits (77%)
  • Encouraging employees to volunteer (74%)
  • Generating financial returns for our stakeholders/shareholders (69%)

Deloitte “2014 Core Beliefs and Culture Study”

Deloitte also found that those respondents who agree they work for an organization with a strong sense of purpose were more likely to say their organization recorded positive growth (81% vs. 67%) and outgrew competitors (64% vs. 44%) in 2013. When looking to the future, respondents who say their organizations have a strong sense of purpose are also much more optimistic about the future prospects of their organizations: 91% of respondents who believe their organization has a strong sense of purpose feel that their company will maintain or strengthen its brand reputation and loyalty vs. 49% of respondents at organizations without a strong sense of purpose.

Organizations with a strong sense of purpose tie confidence to three main factors:

  • a commitment to delivering top quality goods/services
  • focus on long term sustainable growth
  • clear understanding of organization’s purpose and commitment to core values.

Companies reporting they do not have a strong purpose however, find confidence tied almost exclusively to financial factors:

2014 Core Beliefs and Culture Study

When looking at priorities of leadership at these companies, we see a similar trend. For organizations that report having a strong sense of purpose, making a positive impact on clients is ranked most often as the top priority for leadership vs. leadership at companies without a strong sense of purpose, who most often report short-term financial goals as their top priority (the study notes that there were no major differences in top leadership priorities as stated by employees and executives).

Purpose also appears to drive investment. Respondents at organizations with a strong sense of purpose are consistently more likely to say their organization will increase investments year over year than companies without a strong sense of purpose, especially in areas such as:

  • New technologies: 38% vs. 19%
  • Expanding into new markets: 31% vs. 21%
  • Developing new products/services: 27% vs. 17%
  • Employee development and training: 25% vs. 11%

Companies with a strong sense of purpose also perceive higher levels of confidence among key stakeholders – 89% of respondents say their clients trust that they deliver the highest quality products and services (vs. 66% at organizations without strong purpose).

If this data isn’t enough to suggest that there really is something to creating a strong sense of purpose and values at an organization, Deloitte’s data also detail that more fully engaged employees, greater diversity, and encouragement of innovation are also more present at organizations reporting a strong sense of purpose. Despite the benefits though, 20% of respondent’s state that leadership fails to set an example for the rest of the organization by truly living the organization’s purpose and 18% say it is not part of performance evaluations.

Once again, the data are persuasive. Organizations with strong missions that are focused on more than profits are clear winners creating successful, sustainable businesses. Put another way, creating a strong purpose-focused culture may be the best hedge against the difficult economic, political and talent challenges facing most organizations today.

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Filed under China Gorman, Culture, Data Point Tuesday, Deloitte, Leadership, Workplace Studies

Where’s the Trust?

Data Point Tuesday
According to the American Psychological Association’s 2014 Work and Well-Being Survey released last Wednesday, only half of U.S employees believe their employer is open and upfront with them, indicating that despite the mending U.S economy and the return of many organizations’ profitability employees are still struggling to trust their organizational leaders. This distrust comes with serious negative consequences. The APA reports that trust and engagement play important roles in the workplace, accounting for 50.8% of the variance in employee well-being. In predicting trust, the dimensions of employee involvement, recognition, and communication predicted 54% of the variance. Employees reported having greater trust in companies when the organization endeavored to recognize them for their contributions, provide opportunities for involvement, and communicate effectively. In predicting work engagement, employees’ positive perceptions of their employer’s involvement, growth and development opportunities, and health and safety efforts accounted for 27.1% of the variance.

An interesting and positive finding from the APA survey, is in strong contrast to the recent reports that have suggested upwards of 70% of employees in the U.S. are not engaged or are actively disengaged. APA’s Work and Well-Being Survey finds approximately 50% of working Americans reporting average levels of engagement, with around a quarter reporting low or very low levels and just under a quarter reporting high or very high levels. The mean engagement score for working Americans was 3.62 on a six-point scale (zero representing never being engaged and six representing always being engaged). Additionally, the survey finds that 70% of U.S workers report that they are satisfied with their jobs, however, just 47% continue to be satisfied with employee recognition practices and 49% with growth and development opportunities offered by their organizations.

Taking a closer look at the statistics on trust, about one third of respondents say their employers are not always honest and truthful, and nearly a quarter say they don’t trust their employers. Interestingly though, this lack of trust does not necessarily correlate to feelings of unfair or bad working environments. The survey found that 64% of employed adults feel that their organization treats them fairly, despite that only 52% believe their employer is open and upfront with them. Does this mean as an organization you can cultivate fair and honest practices without any transparency? Does this mean that leaders get a pass on being trustworthy as long as they provide safe working environments? These are interesting data to be sure. But perhaps the bigger question is how productive are employees who don’t trust their leaders? What levels of discretionary effort and personal development will employees expend who feel physically safe but don’t trust their leaders? As a leader, the question I would ask is “how long can I rely on an employee population that doesn’t me?”

APA Center for Organizational Excellence April 2014
The APA’s findings come after surveying 1,562 adults aged 18+ who reside in the U.S. and who are employed full time, part time, or self-employed.

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Filed under American Psychological Association, China Gorman, Data Point Tuesday, Employee Engagement, Employee Recognition, Managerial Effectiveness, Rewards & Recognition, Worplace Trust