By Shelley Abrams
Company culture is a very important, and often very prominent, aspect of every business. But it’s also a hard-to-define, nebulous concept. The purpose of this article is to clear up some of that confusion and explain why it’s so important.
The concept of company culture means different things to different people. Take yourself for example. What comes to mind when you think of “Company Culture”? To me, company culture is the all-encompassing and somewhat visible golden thread that both holds a company together and reflects its values back unto itself and toward the outside world. In other words, it’s how everyone—from employees, to customers, to vendors, to investors, and the general public—sees a company when they interact with it. It’s the feeling they get when they visit a company or work for it, when they talk to employees, or when they hear a company’s name.
That’s fine you say, but how do the “experts” define it? In an August 2018 article, The Society for Human Resource Management defines culture as a set of shared beliefs and values established by an organization’s leadership that is then reinforced throughout the organization in a number of ways, ultimately permeating everything the organization does. Inc. Magazine expands on this definition—"Culture is the set of shared values, attitudes, standards and beliefs that characterize members of an organization and define its nature. Corporate culture is rooted in an organization’s goals, strategies, structure, and approaches to labor, customers, investors and the greater community. As such, it is an essential component in any business’s ultimate success or failure.”
Nature v. Nurture
Both of these definitions imply that culture is nurtured through reinforcement of the values of a company. These values are reflected in its vision, mission, business strategies, code of ethics, and by the employees and leaders it hires and the behaviors of those individuals internally and externally. Nurture takes hold through the way a company communicates with its employees and the outside world and in how the company treats its employees and customers. It starts by determining the values that are most important to an organization—the foundation upon which a company is built and grows—and then intentionally driving home those values through actions, including hiring, decision-making and communicating.
However, what if company culture is really something that is intrinsic to an organization? This argument is presented in a 2014 article in Forbes magazine wherein the author, William Craig, founder and president of WebFx, states that “company culture is something that is pre-existing in your company’s genetic code; it’s not something that employees bring with them.” He goes on to say that even “a company with one employee— a company with no employees, if we’re being honest—still has a culture. That sole proprietor? They’re the one with ‘visions, values, and assumptions.’ They don’t wait around for employees to provide such things; instead, they seek out individuals who they feel would be a good match with their existing vision for the company.” In other words, culture is a part of the organization—it’s life force so to speak—that breathes, lives and changes as the company does. No company can exist without it, whether they call it culture or not and whether they nurture it or not. It has a life of its own, and as such, it needs to be cared for and cultivated.
I think culture is organic (i.e. “nature”). But culture must also be nurtured so that it stays true to what the company and its leadership wants to project to its employees and the outside world, no matter how it and its environment change. If you don’t keep culture aligned with strategy and guide its course through practices that support it, then natural evolution begins. Subcultures form within pockets of the organization and culture becomes what it organically grows to be, which in many cases may not be what the company originally envisioned, or needs. In fact, it can lead to a company’s downfall. I’m sure we can think of a few examples.
Perhaps the best way to illustrate what these experts are saying is to share a tale of two companies. These are real companies that I worked at in the same industry, each for about 10 years. One was a small regional not-for-profit company with a specialized customer base. The other was a considerably larger non-profit regional company that became public and went national. I will call them Company R and Company N, respectively.
A Tale of Two Companies
I worked at Company N first, fresh out of graduate school. When I began working at Company N it was a large non-profit company that served the general population. Eventually, it shed its non-profit status, became a public entity and through mergers and acquisitions it grew to be one of the largest national players in its industry. Through it all, the culture never changed. The atmosphere was all work and no-play, high-stress, and the hours worked long and exhausting. The company expected you to be at their beck and call 24/7 and were rigid in their treatment of employees. The CEO reorganized the company from top to bottom every few months to “stay fresh.” This meant you never knew where you’d end up, who you would be reporting to, or for how long. It also meant that at any time you could lose your job—get restructured out of it—and that is what happened to me. You learned important news and updates usually through the grapevine or memorandums and the rare all-team meeting. There were many layers between you and the CEO and you were “lucky” if the CEO knew your name. The CEO even had a private entrance and his own elevator so he wouldn’t have to run into any employees during the day unless he needed you. If you were called into his office you got nervous—it was like being called into the principal’s office when you didn’t know what you did wrong! Not only did this company treat its employees poorly, it didn’t treat customers very well either and had a poor customer rating. You never told anyone where you worked or you would get an earful.
I started working at Company R after being laid off by Company N. The difference between Company R and Company N was immediately apparent when I went in for my first interview. It was a Friday and everyone in Company R was wearing a funky hat! I had several interviews with different department heads, but the most surprising thing was that I had to meet the CEO. It turns out, Company R was looking for a very specific type of employee— one that could let their hair down while they worked and who would always put the customer first. The CEO interviewed each and every prospective employee before a hiring decision was made and he had the final say in all decisions. The CEO also believed in giving back and making the community a better place. Volunteerism was strongly encouraged, with extra incentives and recognition given to those who participated in the many volunteer opportunities presented or sponsored by the company. The CEO was always at each event—it was that important. The CEO also believed that we could do our jobs best if we stayed informed, so there were monthly all-employee meetings where attendance was taken. Special meetings were also held whenever there was important news about our industry, regulations or our customer base. In the ten years I worked there, this company had maybe four reorganizations with no layoffs, and most reorganizations stemmed from someone in senior management leaving to go elsewhere or in response to some change in the regulatory environment requiring a new focus. And those Friday crazy days? It turned out it wasn’t every Friday, but they did do it once a month on the all-employee meeting days. Every month had a different theme. I voluntarily left after 10 years to pursue my own interests and take an early retirement.
I’m sure you can think of many other examples of companies operating in the same industries that behave in very different ways and get very different results, either in the eyes of the customer or to its bottom line. Company culture, good or bad, is recognizable and impactful, inside and out.
Your Culture is Your Brand
Any way you define it, culture is important and affects everything a company does as well as its long-term success. It is a company’s unique take and imprint on the world—it’s brand. How a company goes about keeping that culture—the brand—alive and well, so that everyone buys in and performs in a way that is aligned with the company’s values and helps move the company forward towards its goals, is critical.
Heather Eldred, CEO of Transcend Strategic Consulting, says that culture and brand go hand-in-hand—that culture is your brand. She further explains, “By focusing on culture, you can evolve to a more sustainable brand. At the same time, you develop a more profitable brand. When you align your internal brand with your vision and you clearly articulate that to every employee, you differentiate yourself from the competition.”
Actively creating and nurturing the culture of a company is one of the best things a company can do to help its bottom line. Engaged employees—and leadership—who understand the mission, the vision and the company’s purpose, who embrace the goals and strategies of the company and help it walk its talk, gain a competitive advantage. After all, aren’t you as a customer typically more drawn to a company that gives you a good vibe—the company that puts its money where its mouth is and wears it values and mission on its sleeve for all the world to see? I know I am.