Best Practices - 5 #Startups #SMEs

When Lou Gerstner was given the mantle to turnaround IBM, he did so by steadily changing the Culture of IBM. Changing the Culture of a company is the most difficult endeavour of a turnaround CEO.

Culture is the sum total of values, beliefs, attitudes and behaviors that characterise the functioning of the organisation. Culture sets the tone for how a company operates and how individuals within the company interact.

The single most debilitating factor for any company can be its Culture. Culture takes shape over a long period of time. Once entrenched, it becomes seemingly impossible to change the Culture. Whilst good Culture works towards the progress of the company, poor Culture works towards the ruin of the company.

What practices lead to a poor Culture in any company ? Startups/SMEs should keep in mind the good practices during the formative years of their companies when Culture starts taking shape.

Poor Culture in any company can be due to the following factors:

1. Toxic top management - attitude and behaviour
2. Toxic HR - attitude and behavior
3. Discrimination based on gender, origin, region etc
4. Favoritism, partiality to select employees
5. Lack of transparency between management and employees
6. Lack of diversity - gender, region, institution
7. Absence of true values - ethics/integrity/Iegality/respect/privacy/professionalism
8. Top management not walking the talk - preaching a lot of things, practicing nothing
9. Spying on employees
10. Encouraging bad attitude - Tolerance of bad attitude of performers
11. Lack of trust factor between management and employees
12. Belittling employees openly
13. Sharing bad feedback about employees to others
14. Harassment of employees who quit
15. Encouragement of groupism
16. Encouragement of bad and negative politics
17. Constant comparison of employees
18. Tolerance of nonperformance
19. Hiring top management relatives as employees who do not fit into the slots
20. Lack of enforcement of discipline (timing, dress code etc) and loosened code of conduct
21. Inappropriate personal relationships between hierarchies
22. Managers manage personal matters during office time
23. Personal relationships seep into professional workplace
24. Forcing employees to work on holidays constantly, overwork leading to burnouts
25. Micromanagement by top management
26. Excessively frugal expense management
27. Inappropriate language and bossy communication by top management
28. Disregard for employee grievance and feedback leading to disgruntled employees
29. Hiring new employees at much higher salaries and perks with no marked difference in skillsets, experience level when compared to existing employees
30. Very high salaries (above market standard) to top management and very low salaries (below market standard) to rest of employees
31. Indiscriminate hiring and firing of employees
32. Managers are hired through internal references but without background checks and no proven track record
33. Increments and Promotions to employees based on the whims and fancies of managers - subjective instead of objective performance appraisal framework
34. No employee recognition and reward
35. Management philosophy - Performance "at any cost"
36. Fixed mindset of management instead of growth mindset
37. Profit orientation of management with no regard for customer or employee satisfaction
38. Top managers have their own silo-divisions wielding their authority, power and influence - driven primarily by egoism/egotism
39. Poor managerial skills at the top leading to poor decision making
40. Centralised decision making by top management with no delegation of decision making to junior as well as middle management
41. Lack of communication from top management
42. Dictator style of leadership leading to "yes-men" culture
43. Flawed policies, strong and rigid procedures leading to bureaucracy and unfavorable to employees
44. Gossips, rumours, passive aggression, cliques leading to insecurity amongst the employees
45. Lack of team spirit, collaboration and camaraderie among the employees
46. Lack of stimulation for employees to enjoy their work - "all work and no play"
47. Lack of clarity regarding chain of command, hierarchy, roles and responsibilities
48. Fear of failure amongst employees due to high degree of penalisation
49. Low employee morale due to management's indifference and callousness
50. Prevalence of Zero-sum and Win-lose relationship

These form an exhaustive list of bad practices that I have witnessed in different companies during my stint with them in different capacities in my career so far. We may not find all of the above in one single company. However, they are present in one form or another across different companies. It is impossible to eradicate all of the above in any company. But Top management and HR can attempt to nullify or reduce some of them.

In the absence of good culture, the company will be able to attract only desperate candidates. Good candidates refrain from joining a company with a poor culture. Top management as well HR play a very crucial role in determining, shaping and sustaining a good work culture.

If culture is lost, then the company will invariably head towards a catastrophe.