As most Calgary EOers know from walking-the-walk of driven business excellence, there is one critical aspect of business success that never makes it into a business plan.
Not executive summary, financial analysis or marketing plan. Not the cash flow statements and value propositions. Staff morale is the undefinable but make-it-or-break-it essential.
It is proven, documented and undisputable. Staff morale is the lifeblood of business success. Employee satisfaction and retention are common key performance indicators for business success.
High morale directly drives employee retention, boosts productivity and consistently reflects positively in customer satisfaction. The alternative – when neglected or overlooked – is low morale, often metastasizing into costly disengagement, high turnover and reduced profitability.
“Morale is one of the few business metrics that impacts absolutely everything,” says Amanda Hamilton, creative director at Amanda Hamilton Interior Design and a Calgary EO member. “And it shows up in mysterious ways on the ol’ P&L statement. There’s a reason why ‘happy team/happy clients’ has stood the test of time. At its core, morale is how people feel about the work they’re doing and the people they’re doing it with.
“They need to believe their contribution matters. Without that sense of purpose, morale quickly starts to erode.”
For Glenn Street, entrepreneur, founder and owner of Street Characters Inc. and a Calgary EO member, “Businesses with a morale problem, have a much bigger problem. They have a culture problem, and culture is the most important focus in a successful organization.
“There’s a great saying that culture eats strategy for breakfast. Focusing on culture and creating a great team environment and doing all the right things to drive the organization’s desired outcomes is a win-win all around.”
Paula Worthington, president, Worthington PR & Story and Noble Arrow and a Calgary EO member explains that workplace morale is directly tied to four Cs: Confidence, Curiosity, Collaboration and Culture. Strong morale helps team members excel and nurtures a better work environment for everyone.
“When any of these Cs deteriorate, it quickly leads to challenges. Low morale can lead to high employee turnover, an unengaged or uninspired workforce and decreased productivity.”
Amanda Hamilton notes that, too often, organizations become singularly focused on productivity, profitability and performance, while morale quietly takes a back seat. “In reality, morale is often the fuel behind all three.” She cautions that low morale creates an organizational drag. “Decisions take longer. Communication becomes reactive. Innovation slows. People stop bringing forward ideas because they don’t believe anything will change. Teams become more focused on protecting themselves than advancing the business.”
Street suggests morale is the symptom, not the cause. “Focusing on morale is focusing on the wrong thing. Morale is the effect. The cause is a poor job leading the organization. As the owner, entrepreneur and leader, the role is to ensure an environment that people want to be a part of, feel that they’re appreciated and feel that they are involved in the direction of the organization.
“To solve a morale problem, don’t focus on morale. Focus on the much bigger picture. Buying pizzas and having lunch and things like that aren’t going to fix it. Let people know that what they’re doing is important, feel that they’re heard and involved in how they can perform their jobs, because they know their jobs much better than you do.”