Corporate Culture is critical to the success of any business. In fact, it may be THE critical factor to consistently delivering results. In this blog, I’m going to discuss the challenges I have faced over the last 2 decades of building culture within the organization while aligning to the results required by the business from a CEO point of view first. My next blog will then do the “reverse” and look at Corporate Culture from the Employee perspective, the challenges they face and how to align the two.
WHAT IS CORPORATE CULTURE?
This is an interesting question. In an article in Inc. magazine, Corporate Culture, “Corporate culture refers to the shared values, attitudes, standards and beliefs that characterize members of an organization and define its nature.” This may sound simple, and I think the statement contains a lot of the main points of culture, but if you dig a little deeper into the statement, you can start to see how difficult this would be to build. Let’s take a quick look at the challenge of each:
- Shared Values: This implies that all employees, from the CEO down, share the same value system for the company. This may be possible with a 5-10 person company, but as you grow, this becomes more and more difficult to define and maintain.
- Attitudes: Once again, when you start a company, or maybe run a small family restaurant, attitudes are everything, especially for customer facing positions. But as you grow, and in particular in technology companies, you start to have a lot of differing attitudes within the organization to virtually every component of the business you are running. Keeping this aligned can be a huge challenge.
- Standards: This one, in my estimation, centers around process and building a process driven culture. A simple example of this is going out to your favorite restaurant. The ones that are good are also consistent day to day, entree to entree and service level. Good restaurants will build process, deliver consistent training and hire good people. In a technology company, this can get crazy complicated very fast, but it is equally as important to deliver a consistent product or service to all of your customers.
- Beliefs: Again, this can be a difficult to consistently share across your entire organization, particularly as you grow and add more and more departments with different objectives to the organization. Your finance team, for example, may have a belief that if a particular customer is late on a payment by 5 days, you should shut them off from service until they pay. On the other side in the sales department, the account manager would be horrified if finance did this. Two different beliefs for the same customer in the same company.
- Empowerment: Although not included in the above article, empowerment, I think, should be a key part of any companies culture. After all, most leaders and employees what to impact the organization in a positive way and empowering them to do it is key.
- Excellence: Again, this one is not discussed in the above article, but at LoadSpring we strive for Excellence in everything we do. Making this a key ingredient in your culture can elevate the organization to do their best work.
WHO OWNS CULTURE IN AN ORGANIZATION?
A 2019 article from Company Match called The Top HR Trends of 2019, indicate that 80% of Millennials looks for a Culture fit with future employers and that only 28% of corporate executives understand their culture. So how could this be? Who owns the culture in an organization is a great question we have to always ask ourselves. And the answer is, well, it depends on who you ask. The default answer is “the leader” of the organization, President, CEO, Founder, etc. and to a great extent that is true. In my view, the CEO of any company should be the visionary of the organization and responsible, publicly, for setting the values, attitudes, standards and beliefs of the organization. The reality is, well, it’s more complicated than that.
This is a great place to introduce a different perspective I like to call the Chain of Culture. It’s too easy to pin a companies culture squarely on the shoulders of one person. In fact, as your company grows, it becomes increasingly difficult for a CEO to constantly measure the “pulse” of culture, not impossible, but for sure a challenge. This is also where the team directly reporting to the CEO, in our case at LoadSpring Solutions, the Executive Team, becomes so critical to the Chain of Culture. If a CEO is the primary person to set the vision for the organization, it is the Executive Team that is best equipped to translate that vision to the rest of the organization. But here’s the rub…the CEO has to wear at least 4 different hats within the organization, depending upon the size of your organization. So let’s take a look at those 4 hats and how they impact the message and Chain of Culture:
- Employee/Public Hat: When I communicate with employees, or people outside of the organization, I am wearing my Employee/Public hat. My tone, my message, my words are tailored to that specific audience. In general, it’s a positive leaning tone, that can, when necessary, reach a firm tone depending on the message needed for the success of the organization. Pointing out positive examples of our success, encouraging team work while being transparent about our challenges are super important for this messaging as you try to open the door to personal connection with the CEO while providing leadership and confidence within all of your collaborators/employees in the organization. This set of messaging “should” echo your vision of shared values, beliefs, attitudes and standards. But guess what? It often doesn’t across all of your different employees for a multitude of reasons we will discuss later.
- Executive Team Hat: To be honest for me, I work hard to communicate with my Executive Team with the same tone and messaging that I use with my Employee/Public hat for the simple reason that they are employees as well. Nevertheless, conversations are different because of the nature of what our goals are as leaders. In an attempt to manage a more collaborative environment, I always remind my Executive Team to “check their titles at the door” (or Video Conference Join in Teams) and come to the table as equal collaborators. Although this helps, it’s difficult to completely check your titles at the proverbial door. But in the Chain of Culture, it’s important to recognize that how to solve problems with your Executive Team is NOT the same way you solve problems with sub-department leaders and employees. Our meetings tend to be extremely direct and focused on results only. And invariably, your not always hitting all of your results as expected. I mean, this is exactly the point of Executive meetings, identify where you are falling short in the different areas of the company, openly and transparently, so you can discuss corrective action as necessary. So these meetings will inherently focus more on what’s not working than what is working (80/20) which creates a negative tone. This is the direct opposite of the Employee/Public Hat tone that you want to drive culture.
- Investor/Board Hat: This hat is very similar to the Executive Team hat, but usually much shorter and much more focused on any missing results. It’s a “just the facts ma’am” type of hat. Although there can be politics involved in your board or with your investors, and of course a wide range of different control scenarios, this hat tends to be focused on a sub-set of challenges the CEO is dealing with and primarily on the financial side of the company. Although my boards and investors have traditionally been quite easy to message with, my tone and message tend to be focused away from Operational Challenges and towards very specific financial results of the organization and decisions being made to drive those financial results. So, in many ways, this hat is easier to wear because it’s focused on only one part of the business, it misses the other 75% of what you, the CEO are working on every single day and the impact that operational challenges have on the financial results. This hat is also interesting to watch in play with bigger and more public companies like Amazon, Microsoft or Tesla. If you pay attention to these large organizations, you can see the leaders of these organizations trying the thread the needle between what they are telling their employees and what the investors or board is telling them to do. They don’t always align and this can impact your Chain of Culture, usually in a negative way.
- Customer Hat: This hat is closest to the Employee/Public Hat, but once again, it comes with different challenges. In most organizations, like LoadSpring, the CEO is also the Chief Sales messenger. When the CEO is in front of a customer or prospect, s/he is selling not only the products and services of the organization, but also the values of his/her organization. Additionally, s/he is on stage with both an outsider (customer team) and insider (sales and leadership team) and the opportunity for conflicting messages can, and most likely will, happen. At LoadSpring I work on this specific area of messaging…a lot. I have formal and information conversations with members of our sales team as much as I can because I want to connect dots between our Chain of Culture BEFORE getting in front of a customer. What do I mean by this? At my company, I make it abundantly clear that CEO’s have a choice to make as to who is most important to an organization, Customers or Employees. I also make it abundantly clear that for me, it’s the employees who are #1 and our Customers are a very very close second, with the idea that if our company focuses on providing the right culture, tools, respect, benefits and vision to our employees first, they will naturally translate that to an amazing customer experience. And in general, this works. But now, in front of a Customer, I’m talking about how important that customer is to LoadSpring, which is true, but slightly different to the “insider” also in attendance. The same disconnect can happen if your vision of your culture for the company differs even slightly from the vision your sales team is getting from their Executive Leader. You see, it’s not so easy to manage the Chain of Culture and ensure results, but it’s not impossible as I will discuss next.
BUILDING YOUR CULTURE CHAIN
There are several key components to building a great culture in your organization and although it may start at the top, it’s useless without a Culture Chain throughout the organization. And remember, culture is part science but mostly art. It will never be perfect but you can always strive towards making it more perfect.
HIRING FOR CULTURE
At LoadSpring, we try to take a unique view of the hiring process and use the well established process of Hiring for Performance. Part of that process and trying to understand the person’s overall set of characteristics, not just the skills they have to do a particular job. We spend a great deal of time with our managers and key personnel who participate in the screening process to understand that it’s much more important to hire a person who fits into the culture and attitudes of the organization than simply knowing how to do something. Most jobs at most companies are highly specialized and LoadSpring is no different. Performing accounting tasks here are going to be quite different than maybe your past experience and we know we can teach those skills. Finding a person with the right attitude, the right value system and the right beliefs is an integral part to our Culture Chain so that each person we bring into the company is additive to that culture in a way that grows and nurtures who we are. Again, like all aspects of building culture, this is not as easy as it sounds. If you think about your HR Department, they have a set of hiring targets each quarter that the business has determined are important to our success. The interviewing managers are also keen to identify people as quickly as possible so that they can get them trained and delivering results in as short a time as possible. And of course, the person you are interviewing wants a job. All of these factors actually compete against Hiring for Culture so it’s important that your hiring coordinator is constantly evaluating your entire hiring process to ensure everyone is rowing in that same Culture Chain direction to give the organization the best opportunities for success.
PUT IT IN WRITING
Once you have hired a new employee, it’s important to start building a Culture Chain process with them on day one. The best way to do this is to document what your Mission Statement and Core Values are for the organization. We have a Mission Statement that includes 4 “Legendary themed” experiences we want to uphold followed by 8-9 Core Values that identify key areas of our Culture Chain that are important to all of us in the organization. Developing these statements is not an exact science but they are critical in establishing our values, our attitudes, our beliefs and our standards. We go a step further in the process and try to identify statements of “Who We Are” as an organization. For example, “We are caring”, “We are Responsive” and “We are courageous” are examples of who we are, or more importantly, who we strive to be. I like to think of Company Culture like a sports team. You are bringing individuals with a wide range of different talents in the sport you are engaging in and bringing them into sync as a group to the end result of a win against your opponent. Sounds a lot like what a company does right? So even though each person in your organization is an individual contributor to success, they all must come to the table with a common set of ideals that characterize the team, its mission and its success. And don’t just do a “one and done” with your common goals, make sure they are part of every employee’s life at your company. At LoadSpring we make sure your Mission Statement, Core Values and Who We Are are all over the walls of our offices and we print out these values and frame them for each employee to keep on their desks as daily reminders of who we are as an organization. Remember, Culture Chains aren’t just the responsibility of the CEO, they are the responsibility of all participants in your organization.
It may not be obvious, but building Corporate Programs that advertise your Culture to everyone inside and outside the organization are important in developing a strong Culture Chain. Things like your Benefits plan, Annual Events, President’s Clubs and Corporate Perks all are part of developing Culture, though they may not always be perceived that way. For example, at LoadSpring, I have always found it important for our employees to enrich their lives culturally, really from our initial founding. At a very young age, my grandfather started giving me an annual subscription to National Geographic so every month I got a glimpse into the world beyond Maine, where I grew up. I was fascinated by external and foreign cultures, and still am today. So when I co-founded LoadSpring, we immediately put a program in place we called CultureSpring where we fund a cultural experience for any employee who has worked for us for more than a year, all they have to do is write a 1 page summary of the cultural experience they are looking for outside of their country of residence and we help fund it. Now, this program has no direct correlation to the technology products and services we deliver to our customers, but it says a lot about our Culture Chain. It says a lot about what we value as an organization and the beliefs we have around becoming a more experienced human being beyond the world in which we all live. We say loud and clear to everyone who works at LoadSpring that we care about you as a person, so much so that we will invest in your own personal growth. In fact, pretty much every benefits program, or perk we develop and launch at LoadSpring has a component of our values, attitudes and beliefs. They also demonstrate an unwavering commitment on behalf of the organization to continually invest in the person growth of each person in the company. Although not everyone will participate in these programs, that’s the risk, many do and will build stronger values within the organization as a whole.
PROCESS AND STANDARDS
Finally, I want to discuss Process and Standards within an organization. How you run your company says a lot about the Culture within the company. But this can be a double edge sword. Too much process can have a negative impact on your culture, too little process and you’ve got a fraternity house of confusion and negative culture. This is where empowerment can be very powerful to getting it right. Making conscious efforts to connect process to culture and empowering your leaders and all employees to contribute to both is super critical. If you create a culture where the CEO sets all process which can develop into a “my way or the highway” culture, the Culture Chain starts breaking apart. Again, this isn’t easy for most organizations to overcome, or even identify as a challenge. In my experience starting and building a company, the organization relies on a central leadership figure to set the standards. In a startup, everyone is easily and automatically empowered to “do”. As the company grows, rules start getting established, usually by the CEO and process starts to get set as the standards for your company. As more and more employees come on board, time is passing and the world changes, but your processes, your standards, may get stuck in the past. Additionally, there’s a weird thing with founding CEO’s that happens without notice, respect. Yep, respect for founders and particularly the founding CEO can further hinder evolution of standards and evolution of your culture. Can I control this as a CEO? Well, I can certainly try, and I do. We have a “thing” at LoadSpring I like to term “Calling BS” on decision makers. Often times one of my leaders, when asked by an employee why we do a particular thing a particular way, will take the easy way out and say “Because that’s what Eric wants”. They don’t take the time to actually evaluate and learn the background of the “Why”. So it’s very easy to punt the answer and put it on the founding CEO. This will do significant harm to your Culture Chain because now the employee will be stuck. They may have some great insight on how to deliver a better experience to your customers, or a better result to the organization, but when it’s “because the CEO wants it this way” and 10 foot thick steel wall just descended that blocks any innovation, change and growth. And this is happening at your organization right now, guaranteed. In all likelihood, it’s still happening to some extent at my own company, but you have to create an environment that pushes back on this. So every year at our annual fiscal year kickoff, I remind every employee about this “CEO thing” and empower them to Call BS whenever and wherever and from whomever they hear it, because it’s simply not the healthy culture I believe in. This doesn’t mean, however, that the new ideas are automatically accepted, it simply means, at our company, we want to listen and also train the “Why” where appropriate. If you do this, you will be surprised at how strong your Culture Chain can be as you will learn in my next blog Corporate Culture: Driving Results Part 2, which focuses on the employee participation to the Culture Chain.
Culture is complicated but an important challenge for everyone in your organization. Yes, the CEO sets the overall tone and vision for the company, but even more importantly are the hiring process, the reinforcements, the programs, the messaging and the standards that are set throughout the organization to build a successful and strong Culture Chain. This is not a perfect process because we humans are not perfect. Understanding what impacts your culture, however, is key to delivering a more perfect culture that strives to empower your workforce to deliver excellence to your customers, grow themselves beyond the tasks of the company and build healthy relationships the unite the team to a common set of goals.