Culture.
It’s a buzzword being thrown
around by business leaders quite a bit right now.
And while everyone is talking
about it, nobody seems to know what it really is. Ever notice how some teams
seem to function better than others no matter who is on the team?
I’ve
been paying attention to culture more and more, and I have come to believe that
it is the most important factor in a company’s productivity, talent acquisition
and retention, and even its viability. In a world where the war for talent is
scaling up on a daily basis, building a healthy company culture can be the difference between getting
by and getting ahead.
I’ve studied thousands of teams
and company cultures and have noticed some common denominators among the best.
Take note of these and develop them within your company. The dividends will be
bigger than you think.
1. Purpose
Where there is no vision, the
people perish. That’s what the scriptures say, and it couldn’t be more true in
today’s business world. The companies that are attracting and keeping the best
talent are crystal clear on the “why” behind the “what” of their business. They
are determined to do more than merely build a profit/loss sheet. Hubspot,
a marketing company that has grown to over $180 million in annual revenue in
less than a decade, doesn’t sell itself as building a fast-growing company or a
huge profit center. It attracts employees who want to be a part of a movement,
a movement that is creating more friendly and human marketing. Having spent a
fair amount of time with their team, I’ve seen the enormous talent they have
attracted, and scores of sought-after millennials that have joined their ranks
because of a desire to be a part of something that is creating a change in the
world.
2. Agility
One
of the key components of any great company culture, particularly newer ones, is
the ability to turn on a dime. The start of Virgin
Airlines has become a legendary case study in this.Richard Branson was stuck in Puerto
Rico and trying to get to the Virgin Islands. There weren’t enough passengers
to warrant the flight, so the airline cancelled his trip. Frustrated, he called
around and chartered a plane (that he couldn’t afford at the time). He borrowed
a blackboard at the airport, wrote “Virgin Airlines: One Way Ticket to BVI
$39,” and carried the sign around in front of the folks whose flight had been
cancelled. Branson now jokes that he sold out his very first flight. Not long
after, he founded an airline that would be ridiculously committed to pleasing
customers. Since then, Virgin Airlines has been known for hiring people who can
make quick decisions and demonstrate agility. In an era when many of the larger
airlines are tanking, Virgin has become a model of agility leading to
profitability.
Bodetree, a company that helps small businesses manage their finances, has also grown due to their agility. They realized that there was a need to equip banking institutions to train small businesses on managing their books.
When
I asked the founder Chris Myers about how he discovered the need to pivot
Bodetree’s services, he said, “Admittedly, it took us longer than it should
have to recognize the challenges that we faced. We were so far down the road in
terms of integration and partnerships with companies like Intuit INTU +0.64% that it was exceedingly
scary and painful to pivot. However, once we made the jump and began to serve a
tangible need in a much broader market, everything changed.” When I asked his
advice on how entrepreneurs can know it’s time to shift, he said, “My advice to
entrepreneurs facing a similar challenge today is to rip off that band-aid.
Pivoting is scary, but dragging the process out only makes it worse.”
3. Empowered Employees
Nordstrom JWN +0.78% is well known for their impeccable customer service. It is a
huge part of their business culture. One of the main reasons for their success
is how much authority and responsibility they give their employees. Decisions
are pushed down to the lowest possible level, and that message is delivered
clearly from day one of employment. Their employee handbook famously reads,
“Our One Rule: Use good
judgment in all situations. Please feel free to ask your department manager,
store manager, or Human Resources any questions at any time.”
It’s no coincidence that
Nordstrom is consistently rated as a “best place to work.” When employees are
given true authority and responsibility, it not only allows instant customer
satisfaction, but it also breeds a company culture that lowers staff churn and
increases loyalty among team members.
4. Living Values
Did you know that “ritzy”
wasn’t a word until Ritz-Carlton came along? Their brand
and culture is so strong that their company name is now an adjective in our
dictionary.
The secret to building that culture lies in daily “culture pushes”
throughout the company. Every shift of every day
at every Ritz-Carlton property begins with a 15 minute standing meeting called
“The Daily Lineup.” At each meeting, on a rotating basis, employees share how
they have seen one of the Ritz-Carlton “gold standards” (i.e. company values)
lived out recently at the company. From sous chefs to CEOs to managers to
custodial staff, everyone has the meeting every day, and one of their core
values is driven home.
Writing down your company’s
cultural values is a step in the right direction, but a daily push of those
values brings them to life and takes your company culture (and productivity) to
a whole new level. It’s made a huge difference on my team. What could you be
doing to drive your values through your company more consistently?
Peter Drucker is attributed
with saying “Culture eats strategy for breakfast.” The longer I have been an
entrepreneur, the more I agree. And as our company hits its best stride ever
with culture, we are seeing productivity and effectiveness like never before.
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