I often say that culture is a key factor in the profitability and growth of the business. And if proof were ever needed as to the magnitude of difference it can make, then here are the latest results from Canadian businesses….
“The performance of Canada’s 10 Most Admired Corporate Cultures of 2009, in terms of three-year compounded annual revenue growth, has significantly outpaced the S&P/ TSX by an average of over 300% –or three times,” says Marty Parker, managing director of Waterstone Human Capital, a Toronto-based executive search and human capital consulting firm that has been running the program since 2005. The TSX/S&P compound annual growth rate from December 2005 to December 2008 was 3.8%; for the same period, the CAGR for Canada’s 10 Most Admired Corporate Cultures of 2009 was 12%.
“This proves that an outstanding corporate culture has a significant impact on performance, and that culture is an incredibly valuable asset,” says Mr. Parker.
A wide range of organizations made this year’s list, including: Telus Corp.; Fairmont Hotels and Resorts; industrial supplier Acklands-Grainger Inc.; human resource solutions provider Ceridian Canada; and coffee retailer Starbucks Coffee Canada.
“This year’s data reflects the market correction of 2008,” says Mr. Parker. “What this tells us is that if an organization’s culture is strong, even with a major downturn, it outperforms “Our Canada’s 10 reflects these findings,” says Mr. Parker. “The reason these organizations are outperforming is because of phenomenal leadership and because of the commitment — from the top — to aligning corporate culture. These leaders are focused on behaviour. And behaviour drives results.”
Results of the 2009 Canadian Corporate Culture Study show that 88% of respondents believe their current leadership has led to the evolution of their organization’s corporate culture. In addition, 82% of respondents said that “leading by example” is a key strategy used to align culture. Furthermore, when it comes to hiring, 75% of executives surveyed said that cultural fit is more important than necessary skills.