How to Create a People-First Culture
Many companies claim to be ‘people-first,’ but how many actually live it? If you’re a business owner, your employees know the answer—whether or not you do. As a firm that has used “people-first” to describe who we are since inception, we’ve drawn on surveys from our current and past portfolio companies and our experience in evaluating thousands of companies for this culture, and distilled this down to actionable ways that you can put people first in practice at your company:
The Basics
A people-first company is one that prioritizes transparency, fairness, and engagement—not just perks or paychecks. Core monetary benefits like competitive wages, paid time off, health insurance, and a sponsored 401(k) plan are all critical to attracting top talent and therefore necessary, but they are not differentiators for most companies. These are easily replicated by competition and therefore may not contribute as much to long-term employee engagement and retention when present (though the lack of these can indicate a company that is not people-first and that likely has a recruitment and retention problem).
One core element that remains important to engagement is maintaining a safe and healthy work environment. In one survey across our portfolio company CEOs, 88% of respondents rated this as a top tool for maintaining a people-first culture, and it was also the most consistently used practice across all companies.
Transparency and Fairness
Beyond the monetary basics, people-first companies that promote transparency and fairness seem to have the biggest impact in creating cultures that employees want to be a part of. Transparency isn’t just about fairness—it’s about performance. Employees who understand how they’re evaluated and compensated are more likely to stay engaged, improve their work, and remain loyal to your business.
This starts with clearly documented performance objectives both during onboarding and thereafter as part of regular performance reviews. People like to know what to expect and what is expected of them. This transparency and clarity should also extend to how wages and bonuses are determined. At many of our portfolio companies, for example, there is a preference for tying bonuses to employee performance, but this could be different depending on the industry or individual company – more important than how compensation is structured is how transparent leadership is about the process.
Notice that these practices do not cost additional money to you as a business owner like trendy “perks” – but they can have a much bigger impact than something like having a ping pong table in your break room. Another example of a people-first foundation with a big impact is providing a clear path for advancement within the company – especially if this path is developed in collaboration with each employee and tailored to their passions and skills.
Other ways to promote transparency and engage employees include sharing company goals with all employees (even better, allowing employees to help participate in goal or strategy setting to begin with) and drawing clear connections between an employee’s individual work and the company’s success. For example, entry-level employees working for an aerospace manufacturing company may not appreciate that not only are they contributing to the company’s growth, but they are playing a vital role in ensuring an airplane is safe and functional. This helps add meaning and context to each person’s work.
The last piece of the puzzle is mutual accountability. Equally important as setting high standards for your employees is holding them accountable to those standards, which creates a positive environment for everyone. And accountability should go both ways. For example, we’ve found that providing consistent opportunities for employees to give feedback to company leaders is essential. This could be in the form of 360-degree reviews, all-employee surveys, or consistent check-ins where managers ask what else the employee needs from the company to be successful. At our firm, for example, we annually survey all employees on how well we’re living up to each of our core values as a firm and ask how we can improve our own culture.
Leadership
Leadership practices are among the most impactful tools for building a people-first culture. Among these, leaders showing appreciation ranks high, with 100% of our portfolio company CEOs saying this was “important” or “most important” in creating a people-centric culture. This can run the gamut in terms of complexity or cost, from something as simple as verbal or written “shout-outs” all the way to spot bonuses or other tangible rewards. The point is, people like to know that their work matters and is recognized.
A people-first culture means that employees are seen as and treated as just that: people with their own lives outside of their work at a company. This doesn’t mean being invasive, or forcing employees to share personal details, but employees appreciate leaders that show an interest in them as people, perhaps knowing who their family is or what hobbies they enjoy. Celebrating personal and professional milestones is part of this (to the extent an employee is comfortable sharing that information). As with appreciation, this doesn’t have to necessarily incur a cost; something like a card or email to wish a happy birthday or to say congratulations on a wedding, baby, or new house show that you recognize and celebrate their lives holistically.
A last, hot-button topic related to seeing employees as people first is flexibility in terms of work/life balance. There isn’t a one-size-fits-all solution for this; some types of work really require greater in-person collaboration, or some industries like manufacturing don’t allow for remote work as machines need to be manned. However, if you as a leader start from the position of trusting your employees to get their work done at a high-quality level, you can begin to find common ground on what works for both the employee and the company. Perhaps this looks like a 10/4 work week; maybe it’s a parent leaving early to take care of their kids but logging on after bedtime to wrap up the day, etc.
Want to know if your company is truly people-first? Ask yourself: Do employees understand how their work impacts the business? Do they trust leadership’s decisions? Do they feel heard? If you’re unsure, it may be time to rethink how you engage your team.
