Thriving Through Recession: How Corporate Culture Drives Growth in Times of Crisis
Most of us can remember a few major economic crises in our working lives, from the 1991 recession, the GFC and most recently the pandemic. Economic downturns can be disruptive, challenging, and even devastating for many companies.
Yet some organisations manage to not only survive but thrive during crisis. Industry giants like Uber and Airbnb were born during the 2008 recession; a testament to their resilience and adaptability. What sets them apart? One key factor is their strong corporate culture. In this blog, we will explore how corporate culture plays a vital role in driving growth and success for businesses amid recessions.
A Celebrity Chef in my Kitchen
During the pandemic, I worked with businesses on ways to keep their employees engaged. They booked Zoom socials, online trivia nights, dress-up competitions, and I even got to spend one evening cooking with Donna Hay in my kitchen (well, virtually). We had been sent Donna Hay merch including a spatula, apron and a cookbook. It was truly memorable.
The employees of these businesses felt a connection in a time that we couldn’t physically connect - and the results showed on the bottom line. These employees wanted to continue to serve their businesses and go the extra mile, even through a rough patch.
On the other side, I remember talking to friends who were ready to quit because they weren’t being taken care of. They felt disconnected, unsupported, and lost. Unsurprisingly, their businesses did not fare as well.
It’s so easy to spot the difference between companies, and it’s clear that a strong corporate culture is the driving force behind success.
Understanding Corporate Culture
Corporate culture refers to the shared values, beliefs, attitudes, and norms that shape the behaviour of an organisation's employees and impact its overall performance. It forms the foundation on which the company operates, and during times of crisis, it becomes a compass that guides the company through the storm. It is really the personality of the company, and people who are hired should embody the same culture.
The key to a strong culture is that it’s driven from the top. The CEO and Leadership Team need to embody the culture that they are looking to create, and then set expectations of appropriate aligned behaviours which are measured through KPIs.
For example, if a company says that they are ‘collaborative’, you should expect that team members work to break down silos and regularly engage stakeholders for better outcomes.
Thriving in a Recession
There are lots of words that can be used to describe a culture: Motiving, Engaging, Friendly, Challenging…. but it really comes down to the values and behaviours that move the dial on results. So, which values and behaviours fare the best in a recession?
Resilience in Adversity
A robust corporate culture fosters resilience among employees. When a recession hits, the uncertainty and fear can lead to demotivation and a decline in productivity. However, companies with a strong culture have employees who are more likely to stay committed to the organisation's goals. They understand that the company values their contributions and is invested in their well-being, making them more willing to weather the storm together.
2. Adaptability and Innovation
In times of crisis, businesses must adapt to new market conditions and challenges. A flexible corporate culture that encourages innovation and creative problem-solving empowers employees to think outside the box. Companies that value and reward innovation are better positioned to identify new opportunities, pivot their strategies, and launch groundbreaking products or services, even during a recession.
3. Employee Engagement and Loyalty
A positive corporate culture fosters a sense of belonging and loyalty among employees. When employees feel valued and supported, they are more likely to remain committed to the company's mission and goals. This high level of engagement translates into increased productivity, reduced turnover, and a higher level of customer satisfaction, all of which contribute to the organization's growth even in challenging economic conditions.
4. Customer-Centric Approach
A recession calls for a customer-centric approach, as consumers become more discerning with their spending. Companies with a strong corporate culture prioritise their customers' needs and concerns, building lasting relationships that outlast economic downturns. By nurturing customer loyalty, these businesses can maintain a more stable revenue stream and foster positive word-of-mouth marketing.
5. Transparency and Trust
During a recession, employees may be filled with uncertainty about their job security and the company's future. A transparent corporate culture, where leaders communicate openly about the challenges and plans, can help build trust and alleviate anxieties. Transparent communication also encourages employees to share their own ideas and concerns, fostering a collaborative and supportive work environment.
6. Social Responsibility and Purpose
Companies that demonstrate social responsibility and a strong sense of purpose tend to fare better during a recession. Corporate cultures that prioritise giving back to the community and actively seek to make a positive impact are likely to resonate with consumers and investors. Such organisations are viewed as responsible and ethical, which can lead to increased brand loyalty and financial support during tough economic times.
Thriving through a recession is attainable with the right corporate culture, businesses can rise above the challenges and drive growth in the face of crisis. A culture that values resilience, adaptability, employee engagement, customer-centricity, transparency, and social responsibility will not only weather the storm but also emerge stronger on the other side. In times of crisis, corporate culture becomes the unshakable foundation that holds an organisation together, guiding its decisions, and fostering an environment where success can be achieved despite the odds.