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3 Ways to Spot Cultural Cancers in Your Company and Cure Them

Milind Mehere
Milind Mehere

Most leaders don’t realize there’s a culture problem until it’s too late.

An employee with a negative attitude in the office is like secondhand smoke: The whole atmosphere becomes polluted and negatively affects everyone in the vicinity. If leaders don’t address it, employees will naturally wonder why – and could even lose trust in the company.

For example, shortly after launching one of my companies, my co-founder and I noticed an employee making frequent mistakes. The pattern began with relatively minor slip-ups, such as not properly filling out required paperwork. Instead of being proactive, the employee waited for instructions from others, did the bare minimum, and failed to take ownership of projects or mistakes.
However, these little mistakes weren’t the biggest problem: The employee’s lack of engagement was contagious. He displayed poor body language, made remarks about supposedly dissatisfactory aspects of the role, and spread those sentiments to other team members. Initially, we tried to correct his performance; the harder we pushed, the more sullen he became. We viewed his behavior as a performance problem, not realizing the cultural impact he had on our company. The longer we kept him around, the more his negative mindset seemed to pervade our organization.

Eventually, we let him go; in retrospect, I wish we’d done so sooner. One person’s bad attitude can eat away at your culture until there’s nothing left.

Making a Diagnosis

Colleagues influence one another, for better and worse. According to a study conducted by researchers at Harvard Business School and Cornerstone OnDemand, if you set an upbeat, motivated employee next to an average performer, the latter’s output will increase by 10 percent. Conversely, an average employee’s output will drop by 10 percent if her new office neighbor is uninspired and lazy.

Thus, it’s no surprise that companies with highly engaged employees are 21 percent more productive than those with disenfranchised staffs.

Employees don’t become organizational cancers out of malice. Oftentimes, they’re feeling unappreciated or concerned about the company’s stability. They disengage, with their apathy sapping their co-workers’ energy as well. Unfortunately, most leaders don’t realize there’s a problem until it’s too late. Executives may be reluctant to confront highly skilled employees or those with deep institutional knowledge because they know replacing them will be costly and time-consuming. They justify keeping them around, even though they’ve become a drain on morale and productivity.

Rather than hope troublemakers will rectify their ways, leaders should watch for the following signs indicating an employee has developed a cancerous attitude. Once you’ve identified it, you can take immediate action to keep it from spreading.

They air grievances to other team members.

We encourage open-door communication with our founders. If employees don’t want to talk with them in person, they can contact our human resources department. If employees don’t have channels for lodging complaints, they’ll use colleagues as sounding boards. When those colleagues adopt the habit, you’ll have an office filled with unhappy workers. Fifty-two percent of employers surveyed by CareerBuilder said a negative attitude was the key marker of a bad hire – negativity metastasizes rapidly if not treated promptly.

In the early days of one of my companies, we hired people from larger companies with the experience and domain knowledge to help us grow, but the fluid nature of startup life threw them for a loop. They were accustomed to completing assigned tasks, not being agile and making decisions to drive a company. Lacking the passion to integrate and get things done, they adopted negative outlooks. When newer team members worked closely with them, it shaped the newcomers’ perception of the company. Before long, nobody was having fun or innovating – they were just getting their work done.

The best way to prevent negativity from creeping in is by not allowing it to take root in the first place. Our company makes this a priority by giving new hires context around our culture. I take the time to have lunch with them and educate them on our company’s backstory. This gives new employees a better understanding of why we operate the way we do, right from the top.

We also employ what we call “Stop, Start, Continue,” which is a review within a new hire’s first 90 days. This isn’t to criticize employees, but to let them know early on what they should start doing, what they need to stop doing, and what they’re great at and should continue doing because it benefits the team. This practice emphasizes our forward-thinking culture before negativity has room to set in.

When new hires have the context behind our operations and expectations, there’s little room to question tasks’ or processes’ purposes or become negative about them.

They resist innovation.

Innovation blockers are difficult to spot – they do just enough work to get by, make liberal use of time-off policies, and never put in overtime or extra effort. Because their work is adequate, they rarely set off warning bells until their cancerous attitudes have infected the organization.

Two behaviors, however, set them apart. The first is avoiding data-driven arguments. An unwillingness to discuss hard numbers indicates a person might stifle progress through distracting, emotional confrontations. The second is being ignorant of market trends. If our competitor launches a new initiative, our team should be ready to counter with an innovation of its own. People who complain about a lack of time or resources to innovate are stuck in their comfort zone and will go to great lengths to stay there.

Fortunately, they’re not necessarily lost causes. Employees who resist innovation may fear losing their jobs or being passed over for opportunities if their ideas don’t pan out. Rather than punish failure, we disprove such misperceptions by setting expectations regarding the pace of innovation, how we think about it, what advantages innovation gives us, and why making mistakes is sometimes OK. We lead with things that make our customers successful and make the process better for them.

For example, Tor Myhren, creator of those iconic E*TRADE baby ads, holds what he’s termed a “painstaking candid postmortem” following every business pitch. Whether the pitch worked or failed, his team dissects it to determine what succeeded and what should have been done differently, encouraging honest identification as a team.

Mistakes are part of the learning process. As Wayne Gretzky said, “You miss 100 percent of the shots you don’t take.” We believe in failing fast, and this is rooted in the ethos of our company culture. Employees know that trying is more important than succeeding. We don’t tolerate a CYA approach; we want to do what’s right for our customers and what drives enterprise value, regardless of where the idea came from or who’s executing it.

They’re blind to the company’s vision.

Although having a meaningful goal is essential to employee happiness, a Harvard Business Review Analytic Services report sponsored by BetterWorks noted that 70 percent of American workers feel disengaged at work. Articulating a clear vision to your team inspires pride and ownership in helping to build the company. Otherwise, people will just show up to collect a paycheck.

Everyone needs to hear the same story, which is why my co-founder and I have those lunches with our new hires. These lunches serve a few purposes: We not only let them know why YieldStreet’s operations are set up in the manner they are so as to avoid misunderstandings and dissatisfaction, but we also ensure that our company’s background is relayed consistently to clarify our vision.

During these chats, we focus on three core standards relevant to our business: investor experience, investor success and operational efficiency. Everyone works toward quarterly goals that impact these areas. An HR manager contributes to the investor experience by vetting and hiring a great designer for the company. A marketer might write educational content that helps users evaluate their investment options. Tying everyone’s job back to the shared vision creates a cohesive, efficient organization in which everyone feels valued and important. With monthly departmental goals, we have a simple benchmark: If your work isn’t captured by any projects listed, it’s time to sit down with your manager.

When team members’ achievements align with the company’s mission statement, showcasing their efforts that further the company’s vision shows them how much they’re valued. GroundFloor Media in Denver fosters a sense of ownership in its employees by publishing stories about how different individuals contribute to the organization on the company website. Publicly recognizing these wins motivates them to work harder, gives them an emotional stake in the business’s outcomes, and creates a virtuous cycle of success as the organization grows.

Combating negativity comes down to fortifying culture. The minute someone becomes an employee, he or she should understand the type of attitude and effort expected. I invite feedback and criticism and encourage workers to be candid with me, but I don’t wait until they’ve crippled our company from within to try to curtail apathy and negativity. You must stop cancerous behaviors before they spread.

Image Credit:
Milind Mehere
Milind Mehere Member
Milind Mehere is a passionate serial entrepreneur and founder and CEO of YieldStreet. YieldStreet's mission is to build prosperity for all by connecting investors to high-yield alternative investments that are unavailable to most. Milind has successfully built and scaled three businesses. His last company, Yodle, was acquired by for $342 million in 2016.