The Dangers of a Toxic Culture
How to detect it & make companywide changes to reverse the problem

Before becoming Harley Davidson, William Harley offered a supervisor a new idea. The supervisor literally smashed Harley’s invention, and told him to get back to work. How did Harley react? He continued his innovative project outside of his workplace, where the iconic brand was born.

This was a loss for his former employer, a gain for the marketplace and a tale of the critical importance of company culture. Whether toxic or healthy, culture is the driver of innovation, employee satisfaction and profitability.

Culture is the unspoken system that guides employees—not the policy manuals or the organizational charts. It is a set of values and beliefs that dictate how people relate to each other. These shared values have a strong influence and define how employees can contribute. The notion of corporate culture is gaining traction. Leaders now realize that even the best strategy cannot work if the culture does not embrace it.

Detecting a Toxic Culture

Think of toxic culture like you would asbestos in a building—it is harmful and it must be removed if the project is going to move forward. The following are the most common signs of a toxic workplace.

  1. Silo behavior—Do most people work by themselves, or in their own groups, without coordination and communication with other teams? You can probably spot this behavior among your employees, but are you a silo yourself?
  2. Blame games—Is there a habit of blaming others when things go wrong?
  3. Bullying and aggression—Instead of rallying around shared values, leaders and executives fall back on hierarchy and shut down communication.
  4. Drifting—When no one is willing to make decisions and guidelines are not defined, decisions stall or are sent back up the chain to the next level of authority. This behavior is a sign that people don’t feel safe making decisions and dread accountability.
  5. Data—High employee turnover and low employee engagement scores are warning signs that the culture is toxic.

Cleaning Up a Toxic Site

  1. Find the source—Understand what your current culture is, not just what you hope it is. Hope is not a strategy. Use surveys to capture a snapshot of the company’s current culture. Try resources like the “Organization Culture Inventory,” by Human Synergistics, and “Cultivate: The Power of Winning Relationships,” by Morag Barrett.
  2. Get specific—Determine a culture that will deliver on your organization’s values. Engage your teams in this process. Define a clear vision of the environment you need to succeed.
  3. Fill the gaps—Once you find the gaps between your vision and reality, make a plan to close those gaps. Define at least two concrete actions that leaders will implement closing the gaps.
  4. Follow up regularly—When you believe you have made progress, don’t assume your employees agree. Measure frequently to see how well you are doing.
  5. Communicate more—Once your vision is clear and your actions are set, make sure to reinforce your expectations in all messages and communications.

Culture is the Foundation

Employee recruitment firms cite a 45-percent failure rate of executives because of poor cultural fit. When the new employee tries to do things differently, the “cultural antibodies” take over and push the new employee out. One senior leader in a Fortune 10 company shared how she was struggling in her current position. She wasn’t able to move any proposals forward because of constant criticism from other leaders. In exploring this challenge further, it became clear that the environment she was looking for was not available in her current company. She resigned, at great cost to the company. In her job search, she paid close attention to company culture, and was hired by a competitor.

Talented people in unhealthy environments will rarely step forward with an innovative idea. They will leave at the first opportunity—most likely to join a competitor. If you are not intentionally investing in a healthy culture, your business is already declining, whether you realize it or not.

How to Change Culture

Look for signs of an unhealthy culture, such as negative engagement surveys and customer complaints. Admit there is a problem, and look for solutions. Discuss how you and your teams have lived your values in the past 6 months, and how you plan to live them in the next 6 months.

Cultural problems often masquerade as tech issues or people problems. Stop rearranging deck chairs on the Titanic. Issues with quality are always the result of unhealthy culture. Crystalize your personal values and embody them at work. Create a peer-culture that will be an example for others. Give colleagues permission to call you out when they see actions that don’t reflect company values.