More Revenue, More Profit

Great Places to Work For All are better for business. A consistent high-trust culture is quickly becoming critical for business success.

To see the way a Great Place to Work For All wins in business, look at how a For All culture wins on the basketball court.

That is, look at the Golden State Warriors. The professional basketball team of the San Francisco Bay Area has a motto of "Strength in Numbers," and they live up to it. In contrast to the conventional style of play that isolates the most talented players for scoring chances or defensive stops, the Warriors pass the ball incessantly on offense. And their defense involves all five players working together as a unit, constantly helping each other out and switching assignments.

For the 2016–17 season, they ranked as the second-most stingy defense in the NBA. The Warriors also ranked as the most efficient offense the past two years. They have finished first in assists each of the past three years — a sign of the cooperative, unselfish play that leads to easy baskets. These include the many three-point, long-distance shots that earned Warriors guards Stephen Curry and Klay Thompson the nickname "the Splash Brothers."

Overall, the Warriors' success over three seasons is unprecedented. They won 207 games amid just 37 losses — the best regular-season record in a three-year stretch in NBA history. The team won the league championship in 2015, came within a hair's breadth of winning it in 2016, and won the title again in 2017.

To be sure, a key to the Warriors' strong performance is the individual talent of their players, including two-time Most Valuable Player Curry as well as all-stars Thompson, Kevin Durant, and Draymond Green. But the players are thriving in a culture that consciously builds trust and a strong, inclusive community. Coach Steve Kerr took the reins of the team in 2014, and one of his first acts was to establish a set of values that ran counter to business as usual in pro basketball. Kerr, a former player and NBA champion himself, declared "competition" to be one of the team's four guiding principles. Nothing shocking there. But here were the three others: joy, mindfulness, and compassion.

In effect, Kerr wanted to bring a human touch to a sport that has at times taken itself too seriously and too often treated players more as machines than people with a love for the game. The compassion piece also signaled a level of caring and vulnerability rarely heard from a leader in any professional arena, let alone athletics.

The values aren't just words on a wall for the Warriors. The team has stood out for team chat threads, group dinners, goofy pranks on each other off the court, and giddy celebrations during games.

Much of the esprit de corps flows from Kerr himself. He has proven to be a leader who respects everyone associated with the team and is willing to diversify his talent pool. For example, Kerr made a key strategy shift in the 2015 finals series based on a recommendation from one of his lowest-ranking coaching assistants. His staff includes a 70-year-old assistant coach — Ron Adams — and a female head of physical performance and sports medicine. And while Kerr is not shy about instructing his players, he is known for hearing them out as well. "Steve is a very good listener and because of that is able to solicit good ideas from his players," Adams says. "They know what they say is going to be listened to and respected."

Sports are always about teamwork, but the Warriors have pushed the concept to a new level. They are reaping the rewards of that push, including in the key area of talent attraction. Crucial to the 2017 title win was adding Durant, a former league Most Valuable Player, who was drawn to the Warriors' camaraderie and winning ways.

Those winning ways are fueled by a culture that consciously brings out the best in everyone.

In effect, the Warriors are a perfect example of how Great Places to Work For All are better for business. Most organizations aren't trying to win basketball games. But the same For All culture found in the Warriors will allow any business to enjoy more revenue and more profit.

Trust Fuels Performance

Central to a For All culture is a high level of trust. Our data and other evidence have demonstrated that high-trust cultures win in business.

For more than 30 years, Great Place to Work has studied and recognized organizations with high-trust cultures, in part through the Best Workplaces lists produced in partnership with FORTUNE magazine. For these companies, a defining feature of being recognized as a great workplace is a high level of organization-wide trust, as reported by employees. This research, along with findings from various independent research groups, illustrates that high levels of trust pay off. Among the business benefits of high-trust cultures are:

* Stock market returns two to three times greater than the market average (see Figure 2).

For more than a decade, an independent investment firm has tracked the stock performance of the publicly traded FORTUNE 100 Best Companies to Work For. In a simulated portfolio that is reset with newly named list companies each year, the research shows Best Companies have a cumulative return nearly three times the benchmark Russell 3000 and Russell 1000 indices.

A separate, independent study came to similar conclusions. Alex Edmans of the London Business School conducted a complex four-year study that proved a high-trust culture precedes the Best Workplaces' strong stock market performance, and not the other way around. He also found the 100 Best Companies delivered stock returns that beat their peers by 2 to 3 percent per year over a 26-year period.

* Turnover rates approximately 50 percent lower than industry competitors (see Figure 3).

* Increased levels of innovation, customer and patient satisfaction, employee engagement, organizational agility, and more.

A Great Place to Work study of the hospitals that made the 2016 FORTUNE 100 Best Companies to Work For list found that, on average, these high-trust hospitals have Hospital Consumer Assessment of Healthcare Providers and Systems (HCAHPS) patient satisfaction scores that are significantly higher than the U.S. average for overall hospital rating and whether patients would recommend the hospital (see Figure 4). As patients are the end "customer" in a health care setting, these results demonstrate the positive impact a high-trust culture can have on the...