How small signs of disorder in your workplace can erode culture, safety, and customer trust, and how fixing them builds pride and small business success.

In this episode Henry Lopez explores the Broken Windows Theory and its direct application to small business environments. Originating from research by Philip Zimbardo and popularized in The Tipping Point by Malcolm Gladwell, this theory shows how minor neglect – like graffiti, cluttered offices, or dirty restrooms – signals lowered standards and invites further disorder.

Henry shares examples from New York City’s subway transformation, the car wash industry, and restaurants to highlight how seemingly small details shape both customer perception and employee culture. A tidy and well-maintained workplace not only signals professionalism but also enhances safety, efficiency, and morale.

“Little things matter. When we ignore small signs of disorder in our business, we send the message that standards don’t count here.” – Henry Lopez

This episode challenges you to find and fix the “broken windows” in your small business, setting the tone for excellence.

Question: What is the Broken Windows Theory and how does it apply to small business?
Answer: The Broken Windows Theory suggests that visible signs of disorder, such as clutter or neglect, invite further decline. In small businesses, fixing these small issues (like deferred maintenance or a dirty and disorganized work environment) quickly helps maintain high standards, boost employee pride, and build customer trust.

Episode Host: Henry Lopez is a serial entrepreneur, small business coach, and the host of The How of Business podcast show – dedicated to helping you start, run, grow and exit your small business.

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Transcript:

The following is a full transcript of this episode. This transcript was produced by an automated system and may contain some typos.

Henry Lopez (00:13):

Welcome to the How of Business Podcast. This is Henry Lopez. Small signs of disorder in your business, like a messy workshop or a warehouse or an unclean restroom, or a cluttered office. They can all send a powerful but not so positive message to your employees and your customers. And so on this episode, I’ll share their broken Windows theory. Perhaps you’re familiar with it, the Broken Windows Theory and how it applies to small business owners who want to improve workplace culture, safety and customer trust. So if you’re serious about maintaining high standards and protecting your brand and creating a productive and positive business environment, then this episode is for you. You can find all of the Howa business resources, including the show notes page for this episode, and learn more about my one-on-one and group coaching programs@thehowabusiness.com. I also invite you to join the Howa business community on Patreon, and please subscribe wherever you might be listening so you don’t miss any new episodes.

Henry Lopez (01:08):

Why is it then that small things like a messy lobby or an unorganized workspace can lead to bigger business problems? Let’s start again with a brief introduction in case you’re not familiar with it, of the Broken Windows theory and how we can apply this concept to our workplace culture and environment affecting positively customer perception and resulting in small business success. So based on my research, the Broken Windows theory was first shared in an article by James Wilson and George Kel back in 1982 in the Atlantic Magazine. And it was based on, or the theory was really developed by Philip Zimbardo. Philip Zimbardo was a Stanford psychologist, and he’s best known for the Stanford Prison Experiment where he focused on how environment and context can shape human behavior. So this article mentioned it in context of crime, particularly in big cities. And the particular experiment that Syn Bardo conducted related to this in 1969, he left a car, an abandoned car in the Bronx, New York, and he observed then that it got stripped in minutes.

Henry Lopez (02:11):

It was destroyed within days. People took every single component they could possibly take from it. Then the windows were smashed. It was completely destroyed. He conducted the same identical study with a car in Palo Alto, California, which is a very affluent neighborhood if you haven’t been there. And it remained untouched for weeks until Zimbardo smashed it. He broke some of the windows and then people joined in. So then people started damaging it. So again, you can see the idea. The lesson is that visible neglect invites further disorder regardless of the location. It can be a high-end neighborhood or not so great neighborhood in the Bronx. It is human nature. We respond to those indicators, to those cues, and hence he developed the broken windows theory in New York City. If you were in the subways in New York City in the 1970s in particular, and even going into the eighties, I remember visiting New York City in the eighties, and the subways were covered inside and out in graffiti.

Henry Lopez (03:11):

It was a huge problem. Of course, during the seventies when the city was going through New York bankruptcy, they couldn’t addressed it. If you would’ve asked the authorities, the police department, the mayor, they would’ve told you, we’ve got bigger problems to worry about, right? That’s always the thing. We’ve got bigger things to worry about than graffiti on the side of a train or on the inside of the train. And that’s somewhat true. That’s not that that’s not true. But what they found in applying their broken Windows theory is they launched a clean car program. And so what they did is every night graffiti covered train cars were removed from service and repainted every night, just methodically every night. And so that strategy ensured that graffiti never stayed visible long enough for it to become a normalized. In other words, people said, oh, look, that’s a place to do graffiti.

Henry Lopez (03:58):

Or for the graffiti artists, if you want to call them that, some of them are certainly to take pride in seeing their work of art displayed on the subway. So they went elsewhere. Same thing applied to strictly enforcing turnstile jumpers, which was rampant throughout the seventies and eighties. And again, if you would’ve asked a police officer, why aren’t you doing something about people jumping their turns sales and not paying their fare? They’d say, we’ve got bigger problems. We’ve got murders and assaults and other bigger crimes to worry about. And again, that makes sense, right? But what they found is that by enforcing those little things, getting rid of the graffiti, enforcing and doing something about people that were jumping the turnstiles over time, crime and disorder in the subway system declined significantly. And I can tell you even nowadays riding the subways, my daughter lives in Manhattan, it is relatively speaking, extremely safe and fairly clean.

Henry Lopez (04:54):

All of the trains are clean, some of the stations are not so clean, but the trains are all clean, and it really worked paying attention to those little things. So again, the conclusion in Wilson and Kelly’s article is that small signals of disorder and these examples, graffiti a broken window, fair jumping, it suggests nobody cares, nobody’s paying attention. And so fixing them sets a higher standard than naturally. As humans, we will follow, we will adhere to. And so I’ve been intrigued by this concept, and I first learned about it and reading the book by Malcolm and Gladwell, the Tipping Point, which came out back in 2000, and this is one of the concepts that he refers to in this book. One of the quotes here that he has in the book related to this is quote, if a window is broken and left unrepaired, all the rest of the windows will soon be broken.

Henry Lopez (05:45):

End quote. Now, let’s start to translate that, if you will, to our small business environments. Think about it. I’m sure you’re thinking immediately of those little things that we overlook or we don’t focus on, or we let’s slide because there are small things and the bigger picture, is that really that important? Well, as it relates to the work environment and how people feel, both customers and staff, it does matter. And those little things signal what our standards are. And then it creates this environment where it’s okay to then be sloppy about other things. It’s okay to lower the standard on other things, both how our customers interact with our spaces or with us, and how our employees feel and behave in those work environments. And it doesn’t matter if we’re talking about a high-end attorney’s office or a warehouse where we’re doing work that’s messy.

Henry Lopez (06:34):

These concepts apply equally in all environments. So how else can we apply this broken glass syndrome or theory to our workplaces? Again, an unorganized or dirty space is often one of those things, or we haven’t touched up the paint in the lobby in quite some time, or our vehicles are dirty and messy and damaged. All of those things are examples of how we let the standard slip, and then that creates this effect where people start to lower the standard. An example that comes to mind, of course, having been in the carwash business and using self-serve car washes, those are the car washes where you stay in the car, takes you through the tunnel, and then you can vacuum on your own if you wish. But think about it, if you’re users of those types of car washes, the impression that it makes, I remember clearly recently visiting one and the tunnel was disgusting.

Henry Lopez (07:27):

There was mold, there was abandoned pieces of equipment that were kind of to the side. It was dingy, it was mildewy. So the impression that I got is, wow, I’m bringing my car here to be washed and I care about my car. This doesn’t give me a good feeling. It doesn’t give me a clean feeling. And so that’s an example of the effect that it can have when we lower our standard on those things, on the customer’s perception, I’m here to clean my car, but the environment in which you’re cleaning my car is dirty. So that’s the negative impact as an example that it can have. Or lots of us, I’m sure visiting a restaurant go to the restroom and you wonder, wow, if the restroom looks this bad, if it looks like it hasn’t been cleaned in days and nobody’s checking on it, I wonder what the kitchen looks like.

Henry Lopez (08:14):

So these things, these messages that they send us that, Hey, standards are low here, so it’s okay for me to keep the standards lower or even lower them. It’s because that’s the expectation, either as a customer or as a staff member, if you’ll observe it, if you’ll notice places where there’s trash on the ground, people tend to not care about, oh, I didn’t get my trash in the trash can, or the trash can is overflowing. But if it’s a clean and tighter environment, we all naturally have a tendency to respond in that order. We hold ourselves to that higher standard that’s being modeled for us. So clean, organized workspaces, not only do they send those positive signals, but it also reduces safety hazards and accidents that’s been proven. Orderliness reduces downtime. Workers can find their tools or their supplies faster. For example, employees feel more valued, which of course then improves morale and employee retention and visible standards of cleanliness create pride and accountability.

Henry Lopez (09:15):

Customers, vendors, maybe an inspector, they all respond much more positively to a tidy well kept facility. So there’s lots of real tangible benefits for us as small business owners to pay attention to these little things. To think of the broken glass theory as it relates to our work environments, let me share with you an example that I researched, a company called Stereo Tech. They’re a US-based company that provides food safety, customer experience assessment services for retailers and hospitalities. They’re in the service business, they understand service and what it takes to deliver service. They shared some research that shows that retail locations with higher cleanliness scores consistently earn higher customer satisfaction in sales performance. And so they found that cleanliness is directly linked to revenue. Cleaner stores have more repeat business. This is based on their study. Customers report higher trust and loyalty when the environment that they do business in your environment is visibly maintained.

Henry Lopez (10:17):

So it looks like it’s been maintained. Employees will feel more pride. This has been proven and I’ve observed it and I’ve felt it and working in a clean environment. Let’s talk a little bit more about culture, workplace culture and the impact that keeping our standards high, applying the broken windows theory or keeping it in mind how it impacts culture specifically. So as I mentioned already, clean and orderly spaces, it encourages accountability and pride. We take pride in those environments. Mess on the other hand, breeds more mess order, encourages care that we take care of things. The research, again shows that orderly environments foster responsibility, and people make better choices. Of course, from a customer perception and professionalism, we’re talking about first impressions here. Sometimes if we’re talking about B2C in particular where a customer or a client or a patient walks into your place of business or interacts with your business in one way or another, whether it’s they’re coming into your retail space physically or they’re interacting with your service vehicle in some way, or whatever the case might be, that first impression matters for your brand and for everything else that follows as to how they perceive the overall experience.

Henry Lopez (11:26):

And customers do equate cleanliness as being professional and high quality, small neglect, little things can add up and erode that trust. And of course, it impacts negatively your brand image. So what are some of the steps here beyond the obvious? To apply this theory or be aware of this theory, you want to set specific standards. I’m talking about operating procedures and standards for tidiness and cleanliness. You want to fix even small maintenance issues immediately, like a light bulb that’s out or a scuffed wall, a messy front desk, as I’ve mentioned, a service vehicle that hasn’t been washed in four weeks and is covered in grime. All of those things make an impression. They all add up, and they all create this environment that then not only do customers respond to from a perception perspective, but your employees respond to in their work environment. You have to assign ownership for upkeep.

Henry Lopez (12:22):

You have to make people accountable and responsible and your teams for maintaining the standard. Of course, you have to be the leader. You have to set that bar. Nobody else is going to. Maybe you’re fortunate, you’ve got a manager or a leader on your team that has that same level of standard. But typically, we as the owners, as the CEOs of our business, must model and set the standard for that type of behavior. And then of course, we’ve got to have the systems in place, the checklist, the routines, the procedures to make sure that we execute on these things. We want to create an environment where the system and our people notice those things as well and take action. So I think that the lesson of the broken windows theory for a business owner perspective is fairly simple. Little things matter. When we ignore small signs of disorder in our small business, whether it’s a cluttered warehouse again, or a dirty restroom or an unorganized office space, we send the message that standards don’t count here, but when we fix the small things quickly, we build pride.

Henry Lopez (13:24):

Of course, it results in safety and it creates trust both internally and with our customers. So I encourage you, I challenge you to take a fresh look at your workplace this week or tomorrow or today, and find your broken windows, fix them, and set the tone for excellence in your small business. This is Henry Lopez, and thanks for joining me for this episode of the How of Business. I wish you the best as you start and grow your successful and profitable small business. I release new episodes every Monday morning. You can find the show anywhere you listen to podcasts, including the How of Business YouTube channel, and at my website, the How of business.com. Thanks for listening.