In a recent meeting, our very astute accountant made an observation about the work we do at Cultures At Work, in terms of the impact it makes on an organisation’s bottom line. She noted;
“Because culture determines whether people work effectively together or not, everything you do for your clients, will always effect the bottom line. The problem is that your clients don’t realise that their culture won’t show up as a specific revenue, or expense item in their profit and loss lines, on their spread sheet.
Culture isn’t a function, or business unit is it? Culture is the invisible thread running through everything their organisation does. Now your smart clients will already know this. But I suspect there are many organisations that still don’t understand how culture is impacting on their bottom line because it doesn’t show up as a line on their P&L spreadsheet and it never will.
Because they can’t see it on their spreadsheet companies will often discount the importance of culture’s impact on financial performance. They may even completely overlook the contribution culture is making to their bottom line because they don’t know what to look for if they can’t measure it in numerical terms.
I read in one of your books that this is the reason you suggest engagement surveys are so popular, because they attempt to turn culture into numbers and percentages, which of course you can’t because culture isn’t about numbers and percentages, but it sure influences your numbers at the bottom line. I think it is important, really important, that you take the responsibility for sharing this understanding about cultures invisible impact on the bottom line with your market.
I know you ‘get’ culture. I know because of your background as an anthropologist you can see the culture and hear the culture in a business, but I suspect many companies can’t. So what your work achieves for organisations is always going to be more important to your customers business than most of your customers will even realise.
You have had a really good year, but I think it’s important you increase your efforts to raise awareness that culture is never going to be seen in a line on a P&L spreadsheet, but that doesn’t mean it isn’t impacting on those numbers. If organisations don’t understand that, if your customers don’t understand that, you’re letting them down.”
I’m continually helping business leaders understand that culture impacts the bottom line. Hearing our accountant describe culture as a commercial critical factor was a stark reminder of why doing so is so important. I’ve taken our accountant’s advice and this Ezine is the first step of many in our commitment to raising awareness on the matter of accounting for culture.
Cultural Questions For Consideration.
- How are you accounting for culture in your organisation?
- Do your leaders really understand how their workplace culture is impacting the bottom line?