Research shows culture is key to why employees stay

Attracting & retaining talent has never been more of an issue. Staff are being wooed away; the median voluntary resignation rate has risen to 14% in recent reports, and 2023 work trends suggest this is set to continue. When quiet quitting emerged last year, organisations were quick to react. Many began to focus on how they can re-engage staff, promote learning and development, and improve the employee experience to stop people leaving. Yet sadly there’s no silver bullet to make people stay.

The truth is that while there are many factors that drive employee engagement, talented people ultimately want to work for an organisation whose brand they share values with and are impressed by. The missing element in many discussions around staff turnover and employee engagement is that around values and company culture.

Stanford University research about values & organisation culture fit

A fascinating new study recently published by Stanford University sheds new light on:

• key motivators for employees;
• the impact of values and;
• the role they play in the retention of staff.

Astonishingly, researchers gained access to the personnel and data of a mid-sized technology firm. Then, they applied complex computational linguistics and machine learning to the three main data sets. That information, in totality, consists of:

1. Beyond 5 million emails spanning 8 years within the tech company. This includes the actual content of all the emails as well as who sent what, to whom, and when.
2. In addition, monthly extracts from the HRIS (HR Information System). Data extracts include age, gender, departmental classifications, start dates, performance incentives paid, termination dates, reasons for exit (voluntary or involuntary), and also much more.
3. Also, 440 organisational culture surveys describing employee perceptions of the company values and culture.

After combining and anonymising the raw email data with the personnel records, the researchers were able to run machine learning algorithms. All, mind you, on more than 29,000 person-month observations across an eight-year period of time.

What did they discover?

After gruelling data collection and number crunching, the research team came away in confidence.

“We argue…that values matter… for the choice to remain at or voluntarily exit from the organisation.”

Furthermore, the team suggests that ‘value congruence’ (the alignment of the employee’s personal values to those of the organisation) actually:

 “predicts behaviour … in particular, a person’s self-identification with the organisation and thus her (voluntary) choice to stay or exit.”

How Can You Use This Research?

The research paper, in short, reviews the wide range of prior academic studies conducted in this area.

“High levels of individual cultural fit are associated with increased productivity, stronger commitment, and less turnover. Moreover, employers have increasingly emphasised screening, selecting, and socialising new hires on the basis of cultural fit rather than exclusively hiring for skills.”

Now these findings may not be news to you. In fact, you probably already hold the same view that values and culture are critical to business success. But you may experience some pushback in your organisation. This study, in effect, provides robust, up-to-date evidence (and captured in an innovative manner). Moreover, it helps you build your business case for a strong focus on the values and culture of your business. Values that, in essence, you live, breathe and reinforce at every stage of the employee lifecycle.

Coping with tough conditions

Yes, sometimes unpleasant work conditions can be mitigated where, for example, the work itself is exciting, unusual and provides uncommon development or even just glamorous opportunities. Realistically though, in this age of fierce competition for talent, having the kind of culture and values that help you achieve your business goals is absolutely critical. Leaders must live them and must support the use of incentives and communication that reinforce the values.

Now, build up your business case by examining case studies and real-world examples of value-driven business improvement.

One example to get you started is the astonishing turnaround of the once ailing Microsoft to the now sometimes trillion dollar company it has become since the overhaul of values and culture by CEO, Satya Nadella.

Some examples closer to home are the case studies of the values-led change programmes implemented by Nottingham Building Society, Southampton Football Club and Sturrock and Robson Group.

However you approach this challenge, be sure to take action because it is clear that values will remain a key driver of your organisation’s employee retention outcomes for the foreseeable future.

Need some help?

Do your company values align with those of your employees?

Get in touch to find out how we can help you assess the culture in your organisation and improve the employee experience.