Good morning!

A good company culture isn't just an ideal to live up to, but something organizations must work to improve on an ongoing basis. Pushing culture improvement down on the to-do list can cause talented employees to leave, decreasing innovation. How is the morale at your company? Let me know!

Also in this issue:

🔓 Updates on the WorkDay breach
💸 Dayforce may sell
🧑‍💼 Return-to-office mandates for Ottawa employees

Here's a look at what we're seeing, what it means, what we're anticipating, what's resonating and what you think about today’s workplace. Let's get SMART!

Big tech companies such as Meta Platforms and Microsoft are increasingly using mandatory quotas to identify low-performing employees, a practice that can harm morale and innovation, according to Stefan Mai, a former manager at Meta and Amazon. At Meta, these quotas are sometimes as high as 15-20% of engineers. Critics argue that such systems undermine the trust and collaborative culture essential for innovation, and increase the risk of talented employees leaving.

Many employees tone down their true feelings to keep the peace at work, writes Sean Devlin, an editor at Ragan Communications, who cites a recent survey from MyPerfectResume that found 74% of employees reported "adjusting their communication at work to avoid conflict." Instead of tamping down open expression, Devlin recommends offering a framework for employees to discuss sensitive topics such as politics while respecting the viewpoints of others.

SmartTake: Just as low-performance quotas can stifle innovation, employee anxiety surrounding conflict can do the same. Be clear about company values and expectations surrounding conflict and respectful communication to create an environment where employees feel comfortable engaging with others.

If you're relying on AI to write emails or summarize meetings, you could be missing emotional nuances and team dynamics that can point to underlying frustration or disengagement among your teams, writes Debra Roberts, an interpersonal communications expert. "Your success as a leader still depends on how you listen, engage, resolve conflicts, give feedback and respond to questions. It will always depend on how you connect with others," Roberts writes.

Dayforce is in advanced talks to be acquired by private equity firm Thoma Bravo for $70 per share. The deal, which would value Dayforce at $11.2 billion, comes as the human capital management and payroll software has seen its stock decline over 9% this year. This follows a wave of similar transactions, including Paychex's $4.1 billion acquisition of Paycor and ADP's $1.2 billion purchase of WorkForce Software. This trend reflects a strategic response to a challenging labor market and an uncertain economic environment.

Rose Fass, co-founder of Fassforward Consulting Group, has been instrumental in transforming major companies such as SpaceX and Mastercard by simplifying complex strategies and emphasizing storytelling and leadership development. Fass highlights the importance of viewing AI as an asset, the need for women to confidently assert themselves in male-dominated environments and the value of emotional intelligence in leadership.

Starbucks is implementing a uniform 2% raise for all North American salaried staff as part of a broader service and store improvement effort. This decision marks a shift from previous discretionary raises and is aimed at supporting the company's turnaround strategy, which includes making stores more inviting, enhancing customer service, focusing on cost management and reducing wait times.

I personally relate to today's overarching topic of company culture affecting innovation. My first job out of college was at a tiny startup with no formal HR department -- or even a point person. The unclear expectations surrounding working hours, communications and career development left me feeling confused and unable to speak up about questions I had surrounding my work. These feelings couldn't be worse when working at a startup, which inherently requires employee innovation. This fear-based culture led to extreme burnout and my eventual departure from the company. Reading today's articles, it's clear that companies can make small, tangible changes to their culture to keep talent fulfilled, satisfied and psychologically safe.

I'll be out of office Tuesday and Wednesday next week, but you'll be in great hands with my lovely colleague, Matt, who will be taking over. See you next Thursday!