5 Ways to Fix a Toxic Company Culture

It is difficult to define toxic company culture, but you know it when you’re in one. When I was new at running companies I had an employee who worked in the front office, and when I would walk in the door in the morning I would always greet her and say, “Good morning (let’s call her..) Brenda!” and then one day she didn’t feel like she had to say hello back. She just looked at me and sneered. That was when I knew that I had a company culture problem on my hands.

If rudeness prevails between coworkers, employees hoard information for job security, there is no trust between departments or people, teammates do the bare minimum to get by, there is no accountability, or you are held hostage to your employees - these are signs your company has a toxic work culture.

It is like the opening line of Leo Tolstoy’s novel Anna Karenina, “All happy families are alike; each unhappy family is unhappy in its own way.” Businesses are the same. In a healthy company people feel valued, respected, they know where they are going, what they are doing and what is expected of them. But dysfunction takes many forms.

Luckily since we know what creates a healthy company culture there are some clear ways to clean up a bad one. Here are five ways to fix your company if it is broken.

1. LIVE and DIE by your Company Values

The first thing you can do is define your company values and talk about them constantly. When a company has daily doses of rudeness, gossip, backstabbing, or any other cocktail of disrespect between employees you know that company values are NOT on the forefront of employees minds. Change that. 

Have a meeting or make a video where you clarify what the values are, and what they mean in the context of your company. Talk about them in the hiring process, give kudos, shoutouts and awards when people exemplify the values, and give feedback based on the failure to do so. Fire people who consistently do not act in accordance with the values. 

Talk about the values every day. The goal with the values is that people know what is expected of them, they instinctively know how leadership would want them to act when they have to make a decision on the spot or when no one is looking. They know when other people are not working by the values and they feel empowered to call them out for their actions.  

When employees see everyone living and dying by the values it weeds out people who don’t buy into them. 

2. Create Clarity

A lot of dysfunction stems from a lack of clarity on where the company is going and how to get there. Writing down processes, procedures and policies, having a clear org chart that explains what everyone does at the company and who they report to creates a calm environment. It also sets expectations and standards for success. When people know what to expect and what is expected of them they function at their best. When there is stress, and chaos even the most mature individuals exhibit their worst behavior. 

Clarity also creates an environment where no one can hoard information. Hoarding information is one way toxic employees gain power over others in ways leadership often doesn’t see. 

Clarity also makes it so people cannot hold leadership, hostage. You know exactly what everyone does so you are not afraid to have hard conversations or hold people accountable. Knowing that you are going to be okay if someone leaves because you’re organized and you know what tasks to allocate to someone else or that you could train someone else quickly gives you the confidence to enforce good behavior and your values. This confidence is paramount to fixing a bad company culture.

3. Have the Hard Conversation

Toxicity is allowed to fester if problems are swept under the rug. Facing problems head on in a professional way prevents dysfunction from being an undercurrent in your organization. 

Avoiding conflict, hard conversations or holding people accountable because it makes you uncomfortable doesn’t do your organization, or your employees any favors. Putting off firing people, or important decisions creates an environment where people lose faith in the organization and nothing ever seems like it is going to change. It is important to make time and space to say hard things. Be clear and direct if people are not fulfilling their responsibilities or living up to the company values.

4. Be a Good Example 

If you are a company leader you have to lead by example. If you are condescending and blowing up at people regularly then that behavior will trickle down to your team. They will treat customers and co-workers in kind. If you are late or don’t show up to scheduled meetings that behavior will be seen as acceptable in your organization. If we cannot do something ourselves then it is harder to ask others to do it. Mahatma Gandhi said, “Be the change you wish to see in the world”  we have to exemplify the behavior we want to see at our organizations. 

Write down the behavior you want to see at your organization and then ask yourself, ‘am I a good example of these behaviors?’ ‘Do I consistently model this for the team?’

5. Extreme Ownership

Everything that goes wrong at a company is ultimately the fault of the leader. At my own company if there is a problem the buck stops with me. The questions I ask when a problem arises include:

• Is this a structural issue?
• Is the software not performing?
• Is the line of command not clear?
• Is it clear who is responsible?
• Did we build this process the right way?
• Is the procedure unclear?
• Is the trigger identified?
• Do the steps make sense?
• Are they in the right order?
• Is the hand off clear?
• Is there a training issue?
• Has the person responsible been trained appropriately?
• Is the training built into the onboarding process?
• Is it clear what is expected of them?
• Did I hire correctly for this seat?
• Are they capable of performing this task?
• Do they have the motivation to do this correctly?
• Is this the right person for the job?

When something goes wrong it is my fault and usually it falls into one of these categories. If the process works, there is clarity, and the person is trained then it is time to hold the person accountable and if they cannot perform the task ultimately let them go. But taking full responsibility for everything up stream is the first step in getting culture to align with the values and the ultimate mission of the company.

When leaders execute on these five actions it is amazing how organizational culture can transform. You will witness problems or bad habits that previously seemed intractable disappear. You will notice your team have more fun, relax and be more productive. Moving toward a positive company culture will help you move forward faster, retain top talent and improve revenue growth.