Aniruddha Limaye, director, Great Place to Work India, tells us that culture isn’t about soft, feel-good factors (not that those aren’t important!) alone. A distinctive, abiding company culture is good for business, and often massively underleveraged as a medium for profitable growth.

Q: How do you define a great culture? And, what are the tangible business benefits of having one that not enough founders and CEOs understand?
A great workplace is where employees trust the leaders and managers they work for and that trust is reciprocated; they take pride in what they do individually and collectively as a team and as an organisation; and they have bonds of camaraderie and friendship with fellow colleagues. As per our experience, we have found that great workplaces are more productive, innovative, deliver better quality of products and services and as a consequence of this they deliver far more customer delight. They have lower employee attrition, low absenteeism, their employees act as brand ambassadors for the company and finally they have high degree of profitability and tremendous shareholder value. RSM Astute Consulting (Member of the global accounting and consulting firm RSM International) carried out a study at the suggestion of Great Place to Work Institute, India, of total shareholder return of 50 top companies that our organisation had classified as great places to work, which are listed on Indian stock exchanges, from the period of July 2008 to July 2012, and they found that these great workplaces, in terms of total shareholder returns, outperformed the market by a margin of three times.

Q: Is there a direct correlation between culture and business growth?
Not only is there a direct correlation; a great workplace culture is an important causal factor in an organisation’s sustained success. This can be very well seen from the study our US parent did of Scripps Health, a San Diego-based non-profit, health care organisation. From 2008 to 2013, Scripps Health has been continuously among the annual lists of “100 Best Companies to Work for in the United States,” (published by Fortune Magazine in partnership with our parent organisation). In the early 2000s though, the place was in a very bad state—attrition rates were high, employee and patient satisfaction was low, treatment success rates had dipped and operating surplus was very low. Every stakeholder was unhappy with the current situation. Even the patrons had threatened to stop donating their money to the organisation. Things began to change when the company appointed Chris Van Gorder as the CEO in 2000. His fact-finding led him to the root cause of the problems at Scripps. Every feedback he got said the organisation was neither people friendly nor employee centric.

After introducing a host of initiatives from 2002 onwards their people metric and every operational metric has been going up year on year. In fact, their success continued throughout the economic turbulence and regulatory health care changes in the US.

The Great Place US team found out that Scripps Health turnaround was because they created tremendous mutual trust among the employees and management, and created a caring workplace.

Great workplace culture doesn't come into existence by chance. 

Q:Companies in the mid-sized segment in India aren’t known to consciously work on a definitive culture. Please give us an example of a mid-sized Indian company whose workplace culture you’ve been impressed by, and believe is a case study for others to follow?  
Our experience suggests that great workplace culture does not come into existence by chance. It is the result of conscious and committed actions that begin with top leadership. Here is an example of an organisation that from its inception has worked to create a great workplace culture. It is a Mumbai-based manufacturer of automotive graphic decals called Classic Stripes. On July 26, 2005, there was 100 cm of rain, in less than 24 hours in and around Mumbai. People got stranded in offices, on roads, in cars, many died in the rain, some suffocating in their cars. Lot of property was damaged by the flooding. After some semblance of normalcy was restored, the founder chairman Kishore Musale, went around the factory floor and offices comforted his people and said that the flooding may have caused extensive damage to things in their households. He said they had always treated each other as family, and in that spirit, he offered them financial help from the company. He asked those who got affected to give HR a list of things they had lost due to the deluge, with the approximate cost of replacement.

This was virtually a blank cheque, with no conditions attached. He didn’t ask the affected employees to show HR any proof that they owned those goods or that they had got damaged. Such was the level of mutual trust created by their consciously created great workplace culture that Musale could, without hesitation, make this open and generous offer and no employee abused it. Only a handful, who had suffered extensively, took this help. However, we can be sure the tremendous goodwill wouldn’t have been there, if Musale would have asked people to provide a proof that they owned those goods and also a proof that they were actually damaged due to the deluge. This one caveat, signifying lack of complete trust in employees, would have depleted the effect of the generous offer that he had made.