Demonstrated ROI of Culture Change

When I meet with senior leaders to discuss the impact of culture on their business, I am not surprised to learn that many senior leaders don’t understand that powerful impact. I ask questions like, “What would the creation of a high performance, values-aligned culture mean to your business?” and “How would employees, customers, and stakeholders benefit?” Our discussions help senior leaders understand that they may not have much experience with a values aligned culture. Most are intrigued by the possibility.

However, there is nothing like demonstrated return on investment (ROI) to generate strong senior leader interest in our proven culture change process.

I have helped many organizations around the globe create high performance, values-aligned organizational cultures. The underlying principles of our process are simple: clarify performance expectations, define values in behavioral terms, and hold leaders and staff accountable for both. Implementing these principles is hard work over time, but the results can be astounding.

Our approach has a 10 year track record of demonstrated ROI. Here are highlights from select global clients:

  • ASDA – Since implementing Blanchard’s culture change process, this retail division of Walmart in the UK has been voted the number one employer of choice in a survey conducted by The Sunday Times. 80% of employees believe management listens to and understands their needs. In terms of sales and profit, the company has outperformed the whole of the UK retail sector for growth over a two year span, with profit goals well ahead of plan.
  • Banta Catalog Group – This catalog printing and distribution center outside of Minneapolis, MN generated significant benefits during the culture change process. Two years after starting the process, the plant found:
    • Profitability has increased 36%.
    • Within 6 months employee engagement improved 20%.
    • Employee Retention improved 17%.
    • Recruiting costs have decreased.
    • Training costs for new employees have decreased.
    • Employees actively look for ways to cut costs and improve the work environment.
  • Bowater Pulp and Paper – This newsprint manufacturer and de-inking facility had generated positive impact from a total quality initiative, but Patrice Cayouette, VP and plant manager, wanted to “engage employee’s hearts.” Blanchard’s culture change process helped the Bowater senior leadership team do that. Bowater has realized more than $50 million in cost reductions, health and safety records have improved, and employee satisfaction has risen dramatically. In comparative studies prior to and following the culture change initiative, employees indicated (among other positive changes) 20% improvement in quality being a priority; 40% increase in clarity of work objectives and responsibilities; 20% gain in employees having authority to make decisions; 44% in management follow-up to employee suggestions; and 24% increase in positive interdepartmental relations. In addition, the company has been named a Dow Jones gold medal service and quality winner for several years in a row.
  • Foodstuffs Auckland Limited – New Zealand’s biggest grocery distributor and retailer chose Blanchard’s culture change process to build on their successes and develop leaders at all levels of the organization to ensure focused growth in their market. Results from the program have been exceptional. Within the first year, ROI on the project has been over $600,000, a more than tenfold return on the training investment. In addition, participation, collaboration, ownership, teamwork, morale, and the inspiration to make a difference have all increased. Foodstuffs has achieved:
    • A 28% reduction in employee turnover within three months in just one supermarket
    • A 1% out-of-stock reduction, resulting in $100,000 additional profit
    • A reduction in delivered cost per carton of 9.5% through one of their Distribution Centers, resulting in $200,000 in additional profit
    • A huge positive shift in employee morale and attitude. One employee comments, “This has been extremely valuable; I want to pass it along to others. It provides the skills needed to have an impact in the workforce and turns values into behaviors and performance.”

These numbers are significant, and prove that Blanchard’s culture change process can have a real dollar positive impact on your business.

What is your experience? When you’re in a high performing, values aligned work environment, what ROI benefits have you seen? Share your insights in the comments section below.


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