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The Alternative Board Blog

Is Poor Leadership Damaging Your Company's Culture?

Sep. 27, 2016 | Posted by The Alternative Board
leadership and company culture

 


As the CEO or business owner, your job is crucial in setting the tone for your company culture. These five pitfalls can lead to discontent, high employee turnover and a negative culture.

Your role as CEO or business owner goes beyond planning for the future and forging relationships with investors or a board of directors. The leadership behavior you demonstrate on a daily basis sets the tone of your organization and company culture and often means the difference between a healthy, thriving workplace and a toxic environment where no one succeeds and employees feel downtrodden before they even step in the door every morning.

Many businesses “experience turnover, poor culture and low productivity, but rarely diagnose and treat them as leadership problems,” notes SmartCEO. “Instead they either tolerate them as a common part of organizational life, or mistakenly attribute them to other causes.”

But as any successful TAB Member can tell you, there’s never a good reason to tolerate the effects of a toxic company culture.

Here’s a look at five common leadership traits that foment discontent within an organization and fuel costly employee turnover:

1. Inaccessibility. Of course, a CEO has a busy, if not impossible, schedule to maintain. It’s all too easy, therefore, to cut yourself off from the people who work for you. But when you either lock yourself in your office or are away from the workplace for days or weeks at a time, employees have no sense of your priorities or the direction you wish them to follow. Worse yet, others on your executive or management team can fall into the same pattern, further exacerbating a sense of exclusion within the company.

2. Unwillingness to accept responsibility. Poor leaders are quick to blame others when things go wrong when, in fact, final responsibility rests with the organization’s leadership. These individuals are too caught up in their own egos and an exaggerated sense of their public image. The result? A culture where managers and employees are too fearful to show initiative or share innovative solutions.

3. A tendency to micromanage. Ineffective leaders share one common conviction: Nobody can do things better than they can. They feel compelled to step in and direct business operations at every level or, alternatively, to closely monitor employee behavior and react to shortcomings in a punitive manner. In either case, this ends up frustrating team members and robbing them of a sense of personal achievement.

Want additional insight? Download Easy Ways to Improve Your Company Culture

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4. A lack of communication. Sometimes CEOs develop a new strategy or vision without sharing how they did it. They make pronouncements but fail to share the underlying thought process that led to the new initiative they want everyone to implement. This lack of communication only leaves employees guessing as to how to go about fulfilling the latest strategic vision. It also breeds secrecy on every level within the organization.

5. An indulgence in gossip. People often enjoy gossiping and sharing rumors with others in the company, but if this is tolerated (or demonstrated) at the leadership level, you can abandon all hopes of a transparent and collaborative culture. Gossip “erodes an organization’s culture and energy over time,” writes Matt Ehrlichman at Fast Company. “Cliques form and employees find comfort in their connection to each other through trash-talking—instead of building relationships based on accomplishments and goals.”

Correcting negative leadership traits can’t be achieved overnight, but recognizing that they exist is a crucial first step. The key is modeling the behavior you wish to see displayed throughout the company. This includes:

  • Being available as much as possible and/or holding regular all-staff meetings to share your views and listen to others
  • Transparency, including a willingness to share bad news when necessary
  • Taking responsibility when an initiative fails and sharing the credit when there’s success
  • Encouraging individual resourcefulness and not personally overseeing all aspects of the business
  • Not tolerating gossip or rumors in the workplace
  • Treating every individual, regardless of title, with dignity and respect
  • Promoting and supporting opportunities for employees to grow and become leaders on their own

You’ll know when things have turned a corner and the workplace exudes a new sense of teamwork and excitement. That’s when you can take pride in helping shape a company culture where everyone’s contribution is valued and people are working together to achieve the company’s strategic goals.

Want to learn more about adjusting your company culture? TAB conducts surveys with small business owners to gain insights on various topics - check out the PULSE Survey on Culture to see our summary of findings.

Read our 19 Reasons You Need a Business Owner Advisory Board

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Written by The Alternative Board

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