Culture really matters. Culture, as manifested in the norms, behaviors, and expectations of an organization, can be positive or negative, and has corresponding effects on the profitability of a company. Peter Drucker said, “Culture eats strategy for lunch,” meaning that strategy is great, but it is
the culture of a business that will make or break its strategy. As a business leader, once you understand that a positive culture is the foundation for organizational success, you will probably want to know how to create such a constructive atmosphere in your own company.
Here are five ways to build a great culture in your organization:
1. Develop your leaders
Leaders set the emotional and cultural tone for the rest of the company, as well as an example
of how to behave in an organization. Employees will often emulate their leader’s actions, words, attitude,
and method of treating people. For example, whenever I am on the receiving end of poor customer
service, I automatically assume the employee is acting in the same manner as he or she is treated by
management. Leaders require a high level of self-awareness, honest feedback on their effectiveness, and
training from a mentor or executive coach to properly develop their leadership skills. Remember that leaders are not born but rather develop through experience and encouragement. What kind of training, coaching and stretch assignments are you giving your leaders?
2. Define your values and corresponding behaviors
Think your company doesn’t have any specific values? Every company exemplifies a core set of values
whether they are explicit or implicit. Why not identify the positive values that you wish to live by and
define the actions that will uphold those values? While you’re at it, also make a point of identifying the behaviors that will detract from those values you wish to embody. One company that I worked with created a spreadsheet of the five core values followed by lists of behaviors that support them and behaviors that detract from the values. They used the spreadsheet to train their new hires and referred to it in performance assessments.
3. Build your values into your people programs
It’s great to define values, but not so great if you do nothing with them. The companies that make their
values stick are the ones that bake values into their hiring and firing processes, in addition to their performance evaluation and recognition programs. Make sure you create standard interview questions that both introduce the values and examine the candidate’s ability to conform to them. Include your values in performance evaluations and recognition programs to highlight their importance to the company.
4. Hold all people accountable
Do you hold all people accountable to company values and stated expectations – including working
family members? Do you have stated expectations for everyone in the company, which usually would
be in the form of job descriptions? Do you do annual performance appraisals? Lastly, do you have the
courage to terminate employees when they consistently violate values or fail to meet expectations,
even if the employee is a family member? Unless you can answer yes to all these questions, your
culture will suffer along with the efficiency and effectiveness of your business. One company I worked
with supported the continued employment of a particularly incompetent family member, which then consequently prevented an entire department from attaining its annual goals.
5. Tell stories that accentuate the values
I love the power of storytelling. Whether in company newsletters, your presentations, or in casual conversation, the stories you tell have the power to either build up the positive aspects of your culture or destroy it. In one company that I’ve worked with, the president created a coffee table book of real-life stories and pictures that illustrate the company’s values. The book is now sitting in their reception area, with other copies scattered through the office.
These are five ways to build a great company culture, which are easy to understand but difficult to
implement. The best family-owned businesses I know are constantly working to improve their culture,
because they know that investments in their working environment pay off in greater efficiency, higher
revenues, and better profits.
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