- Almost three quarters (71%) of CEOs highlighted
culture as a top factor positively influencing financial
performance—up from 26% in 2021
- More than half (59%) say it's either very important or
crucial to link culture directly to strategy to see financial
benefits
- More than half (53%) reported their focus on culture
significantly improved employee retention regardless of working
model—be it remote, in-office or hybrid
CHICAGO, July 26,
2023 /CNW/ -- Against the backdrop of a hybrid work
model and an uncertain economy, organizational culture is more
important than ever to boost employee engagement and retention,
company performance, and financial results. That's according to
data from a new survey of 500 global CEOs published today by
Heidrick & Struggles (Nasdaq: HSII), a premier
provider of global leadership advisory and on-demand talent
solutions.
"Aligning culture with the bottom line: Putting people
first" found that CEOs are increasingly focusing on
culture, proactively engaging employees' mindsets, and ways of
working as a path to specific business outcomes to drive financial
performance—and that they are overwhelmingly seeing positive
results.
"An intentional focus on Company culture cannot be separate from
business strategy, the two need to be inextricably linked, and when
aligned can lead to significant financial returns," said
Rose
Gailey, Co-leader, Culture & Organization
Practice at Heidrick & Struggles. "CEOs looking
to accelerate performance in today's volatile market can do so by
ensuring culture remains at the top of their strategic agenda. The
data is clear: investing in your people is an investment
worthwhile, creating a more dynamic organization better positioned
to thrive in a rapidly evolving business environment."
Surveying 500 CEOs globally, the findings from Heidrick &
Struggles revealed that leaders are integrating culture into
evolving working models to boost employee experience and
innovation, and that their actions are driving financial
performance.
A focus on company culture is paying dividends
Of the
results, most notably, CEOs are seeing their strategic focus on
culture driving financial performance. So, how are leaders building
a culture that positively impacts the bottom line? CEOs say
the most important cultural element is direction and purpose, which
saw the largest growth from 37% in 2021 to 69% in 2023. Other
cultural elements crucial to boosting performance include agility,
innovation, and growth mindset (57%) and a positive spirit and
vitality (46%).
CEOs today are coming to terms with the fact that culture has a
tangible impact on company performance, specifically
financials—culture is clearly more than a buzzword. The survey
found that 71% of CEOs highlighted culture as a top factor
positively influencing financial performance—up 44 percentage
points from 2021. What's more, 1 in 3 CEOs ranked culture as the
primary factor overall.
A large majority of respondents doubling down in this area are
seeing the results: 49% of CEOs said focusing on company culture
significantly improved financial performance, with an additional
35% saying it somewhat improved financial performance.
Employee retention: the people-centric approach is
working
Culture is not only driving financial outcomes but
improving the employee experience overall. In fact, CEOs view the
financial benefits as an added bonus, instead driving their culture
efforts with an eye toward employee satisfaction and
performance.
The leading motivator for CEOs focusing on company culture was
increasing employee engagement, more than doubling the number of
responses since 2021 from 26% to 54%. The top three reasons for
focusing on culture were rounded out by increasing innovation and
improving diversity and inclusion. These drivers highlight a
growing emphasis on employees and the way they work
together—demonstrating that CEOs are taking a people-centered
approach.
The survey found that this approach is already proving
beneficial. Culture was the top influencing factor on employee
retention rates—surpassing even compensation and benefits and
workplace flexibility. Almost every respondent said that a focus on
culture was improving employee retention, with 53% saying it
significantly improved retention and 41% saying it somewhat
improved retention across working models. While workplace norms ebb
and flow over time, company culture is a mainstay for CEOs
regardless of what's happening externally.
About the research
In Spring 2023, Heidrick
& Struggles surveyed 500 CEOs worldwide on the value of
corporate culture and how it contributes to the bottom line. These
CEOs came from Australia,
Brazil, Canada, France, Germany, Hong
Kong, Singapore,
Spain, the United Kingdom, and the United States. They lead companies in
consumer goods, financial services, industrials and energy,
healthcare and pharmaceuticals, and technology and telecoms.
About Heidrick & Struggles
Heidrick &
Struggles (Nasdaq: HSII) is a premier provider of global leadership
advisory and on-demand talent solutions, serving the senior-level
talent and consulting needs of the world's top organizations. In
our role as trusted leadership advisors, we partner with our
clients to develop future-ready leaders and organizations, bringing
together our services and offerings in executive search, diversity
and inclusion, leadership assessment and development, organization
and team acceleration, culture shaping and on-demand, independent
talent solutions. Heidrick & Struggles pioneered the profession
of executive search more than 65 years ago. Today, the firm
provides integrated talent and human capital solutions to help our
clients change the world, one leadership team at a
time.® www.heidrick.com
Media Contact
Bianca Wilson
Director, Public Relations, Americas
Heidrick & Struggles
bwilson@heidrick.com
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SOURCE Heidrick & Struggles