Should Companies Care?

Aren’t employees happy just having a job? Why bother trying to create a great workplace? This line of thinking mistakenly assumes that a great place to work means paying higher salaries or offering extra benefits…The defining characteristic of a great place to work is trust between management and employees.

WorkStyle_1_GakuNakagawa

Why should a company try to be a great place to work these days in the midst of the worst economic crisis in three generations? This is an obvious question if one thinks that a good working environment is optional-like flying first class instead of economy. When times are tough, one does away with options. And in these tough times, companies are responding by cutting back nonessentials and laying off staff. Aren’t employees happy just having a job? Why bother trying to create a great workplace? This line of thinking mistakenly assumes that a great place to work means paying higher salaries or offering extra benefits. It’s true that great workplaces often have special perks like the free meals in gourmet cafeterias at Google’s headquarters in Silicon Valley. Certainly when journalists write articles about the best workplaces, they usually focus on their unusual benefits and cultural practices. But based on the tens of thousands of employees in great workplaces that our Institute has interviewed or surveyed over the past 25 years throughout the world, we have learned that the defining characteristic of a great place to work is trust between management and employees. In the very best workplaces, employees insist that what they most appreciate about their firms is that they can believe and have faith in the integrity of the management, are respected by them and feel that they are treated fairly. Having a high level of trust is essential in a time of crisis for several reasons. First, employees are understandably concerned about the future of their companies and their own job security in difficult times. In the best workplaces, the leadership goes to great lengths to share information as openly and transparently as possible with employees. This is especially important if the company is forced to lay off people. We have found that the morale of an organization can remain high even when layoffs occur so long as management has been honest about the situation. A second reason why trust matters is that cooperation requires that people trust each other. Because of the complexity of today’s business organizations, cooperation among people in different parts of an organization is the key to increasing productivity. Finally, the companies that survive and become stronger in this economic crisis will be those that offer customers better solutions. Innovations occur best when there is an environment of trust. People simply do not offer their best ideas to people they don’t trust. That is, employees are more likely to be creative in a work environment where they feel respected and trust the people they are working forFor these reasons, we can expect that the best workplaces will have an advantage during this crisis.

[W greatplacetowork.com]

Published in the hard-copy of Work Style Magazine, Spring 2009