5 principles of intentional firm culture to increase ROI

5 principles of intentional firm culture to increase ROI

Building high-performing teams in a variety of industries has been the highlight of my career. I have learned plenty along the way about finding the perfect candidate for each unique role in each specific company I’ve worked in.

During my time as an executive recruiter, I have successfully placed hundreds of mid-level to C-level executives. However, it is building my own companies that has taught me the most about culture. In this article, I’ll share my biggest takeaways from the past 20-plus years with you in the spirit of helping you build a better advisory firm.

Let’s start with the most important point: If you want to have a culture that positively contributes to the ROI and health of your business, you must be intentional about the process.

The right momentum-building cultures can move the needle exponentially for firms, and we need this capability now, more than ever. This statement is confirmed by recent research published by Deloitte in August 2022 that found 82% of hiring managers are having a hard time attracting and retaining good accounting and finance talent. The accounting profession is facing the Great Resignation and the Great Retirement of seasoned professionals means there are far fewer new recruits coming in to backfill the talent exodus.

As a result, culture is crucial when it comes to recruiting across skill sets and generations. And it's even more important when you have a team and want to retain them so they can continue to grow your firm. Even if your firm has just you and one other person, you are creating a cultureone that will become the fabric of your firm.

How can you build the right culture? The following five principles are ones that I have found to be the most effective for building a culture that will help to drive your firm’s goals and objectives forward. Let’s take a look at each one below and how using it can help you unlock your firm’s true potential.

#1: Culture begins before day one

Before we go further, let’s define culture. I believe that culture is the personality of an entity. Most of the time, what happens is that culture isn’t given much thought at the outset of an organization. In fact, it often isn't given any thought, because there are way more important things to door so many people think. At some point in time, however, you will need to pay closer attention to culture. Otherwise, you will likely end up with a culture that is carcinogenic to your firm rather than one that supports its growth.

Your culture is going to radiate from whomever is in charge of running your firm. When people are just starting out, it falls on them. The earlier culture is intentionally created, the more likely it's going to be in alignment with the founder’s vision.

If you are the founder of your own firm or are instrumental in building the firm’s culture, it is absolutely fundamental to understand that being intentional about your culture will give your firm a true competitive advantage.

#2: Intentional culture creates its own ROI

From my experience I spent in executive search, companies that have a poor culture usually have a poor work environment. In these cases, the organizations are what I would call “source companies” for recruiters. The culture is bad and people want to leave. Employee churn is high and so is their turnover cost. Not to mention the cost of the damage to the firm’s reputation.

On the flip side are the companies that have really good cultures and reputations. These are the companies where recruiting is easier because they can sell candidates on the positive work environment, a culture of care, doing the right thing, treating clients and employees well, and have a strong brand.

If you have a poor culture, your staff can be more easily wooed away. This creates high costs at all levels from the service level through to the highest levels of the organization. This is how intentionally cultivating a positive culture really can contribute to your ROI.

I truly believe the best ROIwith the absolute highest value on our entire companyis hiring. If we hire right, that person is going to make us look like we're brilliant. Their hard work and energy will, in turn, inspire others and multiply the team’s efforts so that 2+2 doesn’t equal 4; it equals 5, 6, or 7. But if we hire wrong, it's damaging in so many ways. Instead of getting a return, we're getting a loss on the time invested, and potentially the spread of a negative culture and demotivation. Now 2+2 might equal 3definitely not a good ROI.

#3: Intentional culture creates value for internal and external stakeholders

At the core, a good company culture is all about being aware that the organization is there to serve its stakeholders. Employees represents one of those stakeholder groups.

Studies have shown that when employees feel like they are part of a mission and have a shared vision, companies are much more productive and profitable. Employees who work at firms with an intentionally built, positive culture are optimistic. They think, “Hey, look, I'm going to get that promotion.”

People who work for companies with toxic cultures are in the mindset of “I'm going to find a better company or I’ll create my own company.”

This dichotomy of intentional versus unintentional culture has become even more pronounced since the pandemic. However, it is amplified in the accounting profession where culture has been cultivated against the backdrop of grueling work schedules and demanding clients.

#4: Being intentional about culture is a competitive advantage

The accounting profession is at a cultural crossroads: A new generation of workers are coming into the workforce who aren't as willing to put up with stifling, inflexible cultures. These changes, along with the remote work restructuring of our working world, requires that when you're thinking about your culture, you also need to think about your business model. Specifically, consider what type of culture is going to attract the employees you want … and help retain them while keeping your benefits competitive, such as prioritizing main stressors for employees such as healthcare, paid time off, and flexible working arrangements.

Culture building is an exercise in continuous improvement. In addition to authenticity and transparency, you need to continually act in service of your culture, because if you're just acting without pay attention to culture, these are just words. You have to believe that the company culture you developed is an expression of you.

Consider our RCReports team. We are strategic and always thinking three moves ahead. That could be part of your culture or values, too, because that's who you are. However, we are continually honing in on exactly how to make sure our culture remains true to the potential of our employees and our company.

#5: Use these keys to creating an intentional culture to unlock your firm’s potential

From my perspective, one of the greatest lessons on corporate culture is that you need to define the company culture before you growand never be afraid to ask for help if you need it. If you haven't thought about it ahead of time and haven’t been proactive about it, you're going to have to wrangle it back into submission to get the company culture you want.

Sometimes you get a neutral company culture, which is what most people end up with, because they don't actually build one or think about it proactively. Sometimes you get a negative culture, because somebody in the company puts that vibe out there. Every once in a while you'll see a company who hires somebody, and that person just inspires confidence.

It’s important to monitor the cultural environment within your firm from the get-go deliberately, and know what you want to build into your corporate culture. That way, you'll have control of it rather than have it just randomly evolved into something that may be good, may be bad. Be intentional about it.

One final thought

Culture is contagious. Either way, positive or negative, it’s up to you to make sure it's going in the right direction. Good luck!

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