Is Your Company Culture by Default or by Design?

In 2019 the phrase ‘organizational culture’ has become almost cliché – it’s buzzwordy, perhaps even trendy to talk about, but how many leaders really know what it means?

Organizational culture is defined as, “The values and behaviors that contribute to the unique social and psychological environment of an organization”. Put more simply, even by Harvard Business Review, “culture is how organizations do things” (Robbie Katanga).

If culture can be simplified down to “how organizations do things” then a simple but critical choice emerges for the leaders in any organization (business, church, team, or even family). Leaders (or coaches, parents, pastors, etc) must decide what behaviours will be asked for, celebrated, and expected; and on the other hand, which will be tolerated, punished, or forbidden?

Taking the first definition into account, there is an intimate correlation between values and behaviours. If for example an organization embraces the Core Value of ‘integrity’ then one would expect behaviours that align with this value to be the norm, and behaviours that contradict this value to be absent from the organization. Telling the truth, earning (not just demanding) just rewards, and hiring and promoting the best candidate (instead of just the most popular) would be some of the behaviours to expect. Lying, cheating, taking shortcuts, and backstabbing your peers should be things you would never see with this group.

As with most novel concepts, it is their implementation, not their definition, that determines their reality. Not surprisingly, the Glassdoor list of the best places to work 2019 reveals comments like;

·       Bain really lives and breathes its values. I feel both challenged yet supported every single day, and truly feel that I am making an impact.

·       Fantastic company culture of "Happiness." You feel it every day and you can't wait to come to work

·       Best work and life balance, amazing benefits, amazing people and most importantly a people-first focused company

·       Procore is all about making you better

·       I love working for a company whose vision aligns with my personal beliefs.

·       I've never worked at a company that cares so much about its people.

·       Working at Google is truly amazing. The best people, perks, and awesome company culture with lots of opportunities for growth.

The above are all comments from employees or former employees, some of whom work for organizations with staffs of more than 50,000! To have this impact in the lives of their teams, the leaders had to decide on a set of values, and defend them as often as they could so that their entire organization knows these are Core Values, not just words on a wall.

Almost everyone has worked for a company whose values might suggest ‘collaboration’, ‘innovation’ and ‘excellence’, but whose reality suggests the only thing that truly matters is profit. The critical lesson here is that all people, and all organizations have values… the question is do they live by the values on the wall, or another set that serves their true motivation? The leader who allows workplace bullying and abuse to take place but would fire a salesperson who misses their numbers should just speak their truth. ‘Performance’ might just be their top value, and a healthy profit & loss statement might justify some unhealthy behaviours in their opinion.

To win in the long term, organizations need top talent, and they need great leadership to unleash that talent potential into customer and shareholder value. The research below, completed by the Barrett Values Centre shows that among the best companies to work for (who invest heavily in organizational culture) the financial returns are nearly 4x that of the S&P 500 index.

Even in a down economy (notice the gap widen in the graph above post 2008), top employees have a choice. Their compensation is just one of the factors they take into account when deciding where to work, and no employee chooses a toxic culture for long once they’ve reached the point that they feel they’re selling their soul for a paycheck.

So leaders – are you setting a vision for an ideal place to work that financially outperforms your competitors because of engaged employees, and fighting to defend it, or is your back turned to your people as they figure it out for themselves?