Startups · Company Culture

Does culture increase employee retention?

Manoj Sahoo Lean Six Sigma Black Belt Project Manager at Freelancing (Self Employed)

September 28th, 2016

Turnover is a big issue with startups. Especially when you have your HQ in a hot startup hub like Silicon Valley or Silicon Alley.

Gary Gitelson VP of Engineering at mPerpetuo, Inc.

September 28th, 2016

   In my experience, culture ABSOLUTELY affects retention.  That effect can be positive, if the culture is good, and can equally be negative, if the culture is toxic.  Especially in the hot startup areas, good employees can find another job very easily.  For the engineers especially, I find that there is a definite Maslow's hierarchy of needs.  Engineers really want hard, worthwhile problems to solve. If they enjoy what they are working on, this is the first concern.  Second to this is whether they enjoy where they work, and like the people they worth for and work with.  This is largely where culture can come into play.  A distant third is money, or other concerns.  So, if you have an interesting project that is making reasonable progress, and your team believes in what the company is doing, then it can very much come down to culture as to whether they stay.  Having said that, a dysfunctional culture where the team can't make progress and people bicker, and nobody gets along, is a prime reason to go look somewhere else.  A toxic culture can make even an interesting and rewarding project painful to work on.  

Sam McAfee Building better technology leaders and teams

September 28th, 2016

I agree with Gary on engineering happiness. Good points.

I'd add to that, good culture (inside and outside engineering) is built on clear communication, transparency, and regular constructive and honest feedback (both ways).

People working in a startup need to feel that the leadership has a clear vision, and that they have a strategy for achieving that vision. Leadership needs to regularly articulate that strategy. In absence of clear information, humans tend to fill the vacuum with fear and anxiety. They jump to conclusions, gossip, rumors. Communication, open and honest, is key to making sure that everyone is on the same page.

Feedback is also very important. Startups are volatile, and the last thing you need is to lose a good person suddenly. Therefore you must check in with people on a regular basis, and see how they are doing. Be clear about their goals (which you set together, not unilaterally) and how well they are achieving them.

I wrote some more on this for my book here.

Mark Rome CFO, Director of Finance, Controller, Manufacturing, Aerospace & Defense, Construction, Logistics, Software & SaaS

September 28th, 2016

About 35% of our employees that terminate have a tenure of less than one year, another 20% have a tenure of less than 2 years.

We're giving up as much as 35% of our profit due to turnover. We have to do a better job matching candidates with our work environment.

There are tools available to manage our workforce (performance evaluations, training, career planning), but few tools available to help us manage our work environment.

To create & maintain an agile workforce,
- we need to capture more data not only from job candidates that apply for open positions,
- but also more data about our work environment 
- so we can make use of a data driven strategy to better match new hires with the work environment
- and hold hiring managers accountable for managing their work environment, and integrating new employees into their workforce


September 28th, 2016

I had zero turnover on one 5-year period and again on a 2 1/2 year period.

I hire people that love what they do, and then don't do anything to get in the way of that.

William Guillory at Innovations International, Inc

September 28th, 2016

I agree with Gary. It is often the reason they join an organization and ultimately the reason they stay. In our short surveys, there are ten questions we fashion from two general ones, with respect to culture:

1. What's it like to work here?

2. What are my chances of unlimited professional success and new learning?

One proviso: Employees need to be reminded that they are working for "great " organization (your personal definition) so that their experience is not taken for granted, but is continually expanded by them (employees).