Company Culture: the Key to Success
Company culture is more important than business or marketing strategy. Why? Many companies don’t need a better business strategy, they need the ability to execute any strategy. This is where a company’s culture comes in.
Culture can be a powerful, hidden asset or it can be a liability – a time bomb waiting to go off. If the leadership team has not pro-actively created a corporate culture to support the company’s purpose, then chances are that the culture is a hidden liability.
Business leaders often assume that their company’s vision, values, and strategic priorities are synonymous with their company culture. Unfortunately, too often, the vision, values, and strategic priorities may only be words hanging on a plaque on the wall. In a thriving profitable company, employees will embody the values, vision, and strategic priorities of their company.
Understanding Company Culture
The easiest way to think of company culture is that it is an energy field that determines how people think, act, and view the world around them. I often compare culture to electricity. This powerful energy field is woven through the thinking, behavior, and identity of everyone in the company. Culture is powerful and invisible and its effects are far reaching.
Organizational Culture: n 1. an energy field that is created whenever a group of people come together to collaborate; 2. foundation for all decisions and actions within an organization; 3. the way things are around here
Culture determines a company’s dress code, work environment, work hours, rules for getting ahead and getting promoted, and much more. The rules of the game, what behavior is ethical and accepted, the mood of the organization, and the enthusiasm of employees are all contained in the culture.
Ignore at Your Peril
During the boom times of the late 90’s when new companies were cropping up every day, I was encouraging the CEOs of several start-ups to do a Culture Building Program early in the evolution of their companies. The response that I often got was, “I would like to do something. But, my investors will never pay for it. Maybe once we go into the black.”
What many CEOs and investors often fail to realize is that company culture is a natural phenomenon. Every time people come together with a shared purpose, culture is created. This group of people could be a family, neighborhood, project team, or company. Culture is automatically created out of the combined thoughts, energies, and attitudes of the people in the group.
Since a culture is created every time a group of people come together to form a team, a company will have many sub-cultures that exist within its main culture.
For example, the marketing and technology teams may have different worldviews, jargon, work hours, and ways to do things. A big challenge for today’s company is to create a strong, cohesive corporate culture that pulls all of the sub-cultures together and ensures that they can work as a unified team.
Don't Ignore the Invisible Parts of Company Culture
The far more powerful aspects of culture are invisible. The cultural core is composed of the beliefs, values, standards, paradigms, worldviews, moods, internal conversations, and private conversations of the people that are part of the group. This is the foundation for all actions and decisions within a team, department, or organization.
Visible Manifestations of Company Culture
- Dress Code
- Work Environment
- Work/Life Balance
- Titles & Job Description
- Organizational Structure
Invisible Manifestations of Company Culture
- Private Conversations (with self or confidants)
- Invisible Rules
- Moods and Emotions
- Unconscious Interpretation
- Standards of Behavior
Shifting the Company Culture with Carefully Crafted Conversations
The powerful part of culture is invisible, so how can you change it? Through conversation.
Conversations have the power to make the invisible visible. Language is not merely descriptive, it is generative. Language and conversations have the power to generate a new, powerful future and to create a cultural energy field that will support and sustain this future.
What creates the embodiment of values, vision and goals (or lack of embodiment) is the culture that permeates the employees’ psyches, bodies, conversations, and actions.
The failure to discuss the values, purpose, and rules within a group often leads to a culture that is at cross purposes with the stated intention of the group. Poor communication creates a lot of confusion and often a crisis of meaninglessness.
Most companies try to “fix” perceived problems by addressing the parts of the corporate culture that are easy to see. Some quick-fixes include holding Friday TGIF parties and company picnics or adding fringe benefits and perks. None of these actions will have a powerful or lasting effect on a company’s culture.
The energy fields that make up organizational culture are dynamic and change continuously. Culture is created and constantly reinforced on a daily basis through conversations, symbols, rituals, written materials, and body language. It is the small, mundane actions and behaviors that create a corporate culture and can shift a corporate culture.
Creating and sustaining a healthy, vibrant culture requires reinforcement of the culture through daily, proactive conversations and communications.
Creating and sustaining a healthy, vibrant culture requires reinforcement of the culture through daily and proactive conversations and communications.
The CEO and leadership team of a company have a powerful impact on culture through their conversations and behaviors. Unfortunately, most business leaders receive little to no education on how to have powerful conversations that generate culture and actions. Culture building can be learned, but it takes an honest commitment from the leadership team of an organization.
Diagnosing Company Culture
There are two ways to diagnose your current company culture.
- Do a formal survey of all the stakeholders as part of a strategic business audit.
- Start asking questions and having important conversations.
The best way for a leadership team to learn what is going on in their company is to have informal conversations with a wide range of employees. To accurately take the pulse of the organization, these conversations need to be structured around some fundamental questions.
Below are ten questions to start the conversations.
[Unfortunately, if the organizational culture prohibits honest answers, especially to the CEO or leadership team, this exercise could lead to misperceptions. In that case, it is particularly useful to employ a facilitator, executive coach or business anthropologist to lead the conversations.
Ten Fundamental Questions
1. Is your work meaningful?
People need meaning and purpose in order to live their lives fully and be productive corporate citizens. Healthy cultures provide people with shared meaning and connection to a purpose higher than their individual pursuits. Using stock options and other monetary incentives to hold onto people is a short-term band-aid if there is a crisis of meaninglessness in the company.
Lack of share meaning leads to:
- Unmotivated, unproductive people who are not working to their full potential
- People reserving energy and creativity for activities outside of work
- Decisions made at cross-purposes with the vision and mission
2. What is the company’s purpose?
Employees should have a quick and simple answer to this question. They need to embody the purpose of the organization for the company to thrive. This is not a matter of reading the Vision and Mission from a wall plaque, but internalizing the purpose and aligning it with personal vision and mission.
Confusion about the company’s purpose leads to:
- Unclear about what we are trying to accomplish
- Energy of organization continually declining
- Inefficient work processes
3. Are you empowered to make decisions and move into action quickly?
A healthy, thriving culture supplants the need to “control” people. The traditional method for building a company uses a hierarchical, command-and-control structure. This is at cross-purposes to succeeding in today’s business environment. The speed of today’s economy requires flexibility, quick decision making, and cooperation with customers and partners.
Lack of empowerment leads to a “bunker mentality” and:
- No personal accountability or responsibility
- Slow time to market with new products
- Lack of innovation
4. Would you leave this company for the opportunity to start at the ground floor of another company?
A culture needs to sustain its entrepreneurial zest. When companies grow beyond the point where the leaders know everyone by their first name, the natural inclination is to start putting a bureaucracy in place, implementing procedures, and putting in some controls. Yes, the company will benefit from standardized processes and automation of standard procedures.
But, putting in explicit controls on people often drives out the most innovative, entrepreneurial contributors that are critical to the success of a company.
Low entrepreneurial zest leads to:
- Suffocate the entrepreneurial culture that people value.
- Stamp out creativity.
- Drive out the key innovators to new start-up opportunities.
5. Do company leaders walk their talk?
In organizations today, there is great discrepancy between what is said and what is done. Often people do not know which conversations they can rely upon for action. Many times this is because company leaders have not learned how to have effective conversations that generate powerful action.
Not walking the talk leads to time and energy wasted on empty conversations and:
- Formal work processes that don’t work
- Missed deadlines
- Long product introduction cycles
6. Can you show your emotions at work?
People are human. They are not machines. Motivation is the root of emotions and decision. Most decisions in business and life are made based upon a person’s emotions or emotional state. A person cannot be separated from his or her emotions. A person working with passion achieves so much more than someone working on the clock to get a paycheck. How can people be passionate about their work if they cannot have any emotions?
When Emotions and passions prohibited:
- Leaders cannot recognize and adjust the mood of an organization
- People will express their emotions inappropriately, and often destructively
- An organizational mood of frustration, anger, or apathy
7. Do you have a community of people in the company that support your efforts?
Healthy corporate cultures offer their employees a community of people that support each other as they learn and grow. As we spend more and more time at work, we are looking to our work environments to provide community that we used to get elsewhere. The number one cause for people either liking or disliking their jobs (and staying in them) is their relationship with their direct supervisor.
Lack of community leads to:
- High attrition rates
- Poor communication
- Dissatisfied employees, customers, and partners
8. Are your contributions valued?
People are not interchangeable. They are unique individuals – each with a gift to share with the company. If people are blindly shuffled through departments or into job descriptions, they will lose their creativity and tend towards “group think”.
When people are viewed as “widgets” this leads to:
- Group Think
- Low creativity
- Organizational mood of low energy and resignation.
9. Do you trust the leaders of the company?
It is virtually impossible to work productively with people that you do not trust. If employees do not trust the leadership of your organization, they will not be comfortable being their authentic selves and will expend tremendous energy putting on game faces every day.
Lack of trust leads to:
- Poor communication with employees, customers, and partners.
- Organizational mood of low energy and resignation.
- Difficult to attract and retain good people.
10. Can you say “I don’t know”?
If your culture has an invisible rule that says “never admit you don’t know something”, then no learning or innovation can take place within your company.
Inability to say “I don’t know” leads to:
- Low rate of innovation
- Errors in judgment and operational decisions
- Company overtaken by innovative competitor
Use these questions to structure frequent conversations so you can keep your finger on the pulse of the company.
Culture: A Powerful Invisible Force
Remember that your organizational culture will affect the ability to execute any strategy. Culture is naturally created any time a group of people come together with a shared purpose. Culture can be a powerful, hidden asset or it can be a liability. It’s up to you to proactively create and maintain a healthy, vibrant, innovative culture or passively allow a culture to emerge and hope for the best.