Factoid Friday – Culture = Profits

Source: USC Marshal Business School

Culture is defined as any values, assumptions, and artifacts (symbols, stories, texts, ceremonies, rituals, etc) associated with the company. How well the company adheres to culture and how well the company culture promotes growth, improvement and a suitable work place determines cultural strength. There is a clear correlation with culture and return on capital and even though it’s only at .51 (out of a possible 1.00) this is higher than most single factor regressions. The study takes samples form companies in various sectors but in general for every 1% improvement in the cultural environment of a company we can expect about a 3% increase in return on capital. The good news is that there is a way to systematically increase your culture and if you are interested please Contact Us.

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