Are we winning the Culture War?

“Culture eats strategy for breakfast”, a phrase originated by Peter Drucker is an absolute reality!

 Many studies show there is a direct correlation between a healthy culture and an organization’s bottom line. According to a study by James L. Heskett, faculty Harvard Business School, “culture can account for 20-30% of the differential in corporate performance when compared with ‘culturally unremarkable’ competitors.” 

 Organizational culture not only drives productivity but also plays a critical role in attracting, engaging, and retaining great talent. Many organizations spend considerable time and resources in building a unique culture supported by a differentiated set of perks or benefits. These can include a cool office place, unlimited leaves, free meals at work, or even offering free spa and salon services. For those crafting these types of cultures to engage employees and improve employee retention, it can be both an exhausting and seemingly endless grind. Trying to address everyone’s desires isn’t just difficult—it’s impossible.

 So what is the solution? The answer is incredibly simple. Stop worrying about employees’ unique preferences and stick to the basics. According to multiple pieces of research that I have gone through, given below are the aspects of great culture:

 1. A Compelling Purpose – In the book Good to Great, Jim Collins talks about the role a compelling purpose has in the long-term success of an organization. We all need to understand the why of what we do. Companies that have a compelling purpose which is prominently displayed in actions, can help orient customers, suppliers, and employees. A couple of great examples that come to mind are SpaceX, whose purpose is “To revolutionize space technology, with the ultimate goal of enabling people to live on other planets.” Or Oxfam whose vision is “A world without poverty.” A compelling purpose is a simple but an important starting point for any culture.

2. Ownership & Action-Orientation – Employees love a culture that is focused on results and getting things done rather than beating around the bush. No one wants to work at a company that promotes a lazy attitude or lacks drive. People thrive in cultures where everyone takes ownership of the goals assigned to them and they collectively move the organization toward accomplishing its objectives. This helps build a gratifying work experience for the employees and goes a long way in engaging and retaining them. A great example of this is Netflix, where everyone is made aware of how they are adding value for the organization, and employees are expected to take accountability of their deliverable without any micromanagement. 

3. Sense of Fairness (in Performance, Growth and Rewards) – Rewards and personal growth matters! People love to work at places they feel are fair in evaluating their performance, sharing rewards, and providing them growth opportunities. Promoting a high-performance culture that endorses fairness and personal growth can help scratch this itch. It will also help employees feel like their organization doesn’t just want to take work out of them, but is focused on sharing appropriate return with them in the form of rewards and development. No wonder, in a study by Great Place to Work Institute, “Organizations that report a high number of issues relating to favoritism and politicking score relatively low in employee engagement and retention metrics.”

 I would also like to call out the importance of recognition. If recognition isn’t an active part of your company culture, it should be. Everyone loves a pat on the back and public appreciation. It brings employee’s contributions to the forefront and has a positive impact on their overall experience.

 4. Security – We don’t enjoy a bolt from the blue in our personal lives, so why would we enjoy it at our work? It’s not a surprise that safety needs are one of the initial blocks in the Maslow’s Need Hierarchy theory. Creating an organizational culture that helps employees feel secure and stable in their roles can alleviate anxiety and concerns. This is not only important to retain talent but also necessary to avoid any unnecessary distractions. Sometimes organizations do have to make difficult decisions like layoffs, etc. (like in the case of COVID19) but it is important to maintain effective communication so that employees continue to trust the organization. A recent email by Airbnb CEO, Brian Chesky communicating lay-off of employees is a great example of honest and effective communication with employees.

 5. Collaboration – Humans are fundamentally social creatures. We enjoy camaraderie and feeling like we belong to a group and something greater than ourselves. Building an organizational culture that supports collaboration can help employees feel supported and meet one of their basic needs of belongingness. Collaborative cultures are great at achieving organizational goals and fostering creativity and innovation. Google is a great example of an organization that has build a culture of collaboration (by using practices like OKRs where everyone’s goals are public, Conversational turn-taking, Googler to Googler’ program, etc.) which in turn has helped them become a market leader in some key product domains.

 6. Trustworthy Management – While having leadership that sticks to their words is important, it is even more critical to have people managers that display organization values and are credible. People managers are the backbone of the cultural dynamics of the organization and play an important role in the journey of an employee with the organization. As per a study by Fortune, “When employees say managers are honest and credible, they’re 5 times more likely to want to work there for a long time, and 11 times more likely to think the workplace is great.” Hence it is critical to invest in developing great people managers and converting them into culture ambassadors.  

 As we look ahead to the post COVID era, many organizations are thinking of moving to a “work from anywhere” model. In such a model, having cool offices or other such unique benefits will not solve the engagement and retention problem. Organizations will have to double down on the aspects above to build a strong culture to ensure long term success. 

 I would love to hear about any other aspects which readers believe are key to building a great culture. 

#Culture #HR #Business #Leadership  #humanresources #management