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Is the ROI of culture still in question?

Strategy, Culture, Change Leadership | 21 Jul 2021 |

It can be difficult to explain to a CEO and CFO what they’re buying when they invest in culture. It doesn’t come with a money-back guarantee and it’s not as tangible as a product release that your customers will buy, consequently increasing your revenue. 

Yet, it has been acknowledged for years now that company culture does have an impact on its overall performance and that neglecting it can lead to lost opportunities for synergies and cost efficiencies, lost customers, lost employees and increased injuries to name just a few.  

As early as 2011 John Kotter and James Heskett provided insight in their publication “Corporate Culture and Performance” and reported that companies investing in communicating their vision, mission and values recognize their profits climbing as much as 75% higher. 

Much more recently, Gartner Analysis highlighted the following impact of culture on business outcomes: 

  • 9% on performance against revenue goals  
  • 8% against talent management goals 
  • 22% on employees’ performance  
  • 16% on reputation outcomes 

While not instant, the correlation between culture and performance can be witnessed over time and on many levels. Therefore, it can be surprising to see that, often, companies do not have a distinct budget allocated to culture (development, maintenance, growth etc.) as they would have for their digital strategy for instance. 

Maybe what is in question is not the impact of culture on performance, or the Why it is important, but more the How to create a culture that drives performance and How to measure its current state and its stage of progression in your organisation. Measure it and implement change are the challenging parts. 

What are your thoughts? 

You can find some case studies here and we’re always happy to have a quick chat and answer your questions, message us at [email protected] 


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