When times are tough, we often look to the P&L statement to find ways to cut costs and maximise profit. While this is a necessary step, it cannot be done without considering your team and your company culture. Here’s why:
Their Strategy Destroyed Their Culture
In the world during and post-pandemic, many businesses are trying to get back on their feet. With fewer travelers and a new way of living, many businesses are having to look at new ways to operate and stay profitable. One of these industries is the airline industry.
The airline industry was one of the hardest hit during 2020 and beyond as restrictions resulted in little to no revenues. This hit the industry hard with many retrenchments, bankruptcies, and reduced operations being seen.
The airlines now operating again have looked for ways to cut costs and streamline their operations. One way was to stop crews from staying over at the location before flying back a day later, as this led to hotel and overtime charges. Instead, they opted to have the crews fly straight back to work another shift.
While this may have looked good on the income statement, it had dire consequences for their business. Staff was overworked and planes were pushed on tight schedules to maximise their profitability. This led to delays in flights, cancellations, and unhappy staff causing unhappy customers.
All in all, this caused customers to move to other airlines. The airline lost a lot of the customer loyalty that it had spent years building. Customers now looked to other airlines for better prices and service.
The moral of this story is that your strategy cannot be looked at without consulting your company culture. The tight schedules and overworked staff destroyed the comradery and atmosphere customers enjoyed. It also led to less productive work and more mistakes. All that could have been avoided had the leaders looked a little further than just the profit and loss statement.
Strategy Cannot Be Used in Isolation
A strategy is great, but if you don’t have a team behind it to implement it, you have nothing. Company culture is what helps you put your strategy into action, it's what sets your company apart, and it’s what turns your employees into brand ambassadors.
Rather than just focusing on strategy work with your team to build a happy work environment where everyone is productive. Then implement strategies that complement but don’t destroy this happiness and productivity.
The Company’s Culture Starts with You
Company culture is not something big bonuses will fix. Company culture is much more than that, it's being appreciated, heard, valued, and feeling like you belong. It takes time to build up and can be destroyed in seconds.
Put your company culture first and you will see an increase in productivity and thus profitability. People build businesses, so start building people!