Company Culture in 3 Simple Steps
How to easily define a company culture, so your dream organization doesn’t turn into a nightmare.
Many entrepreneurs start their businesses with a new solution to a problem or an unmet need. Entrepreneurs rarely think about how they are going to have to knit a diverse set of people together. Yet the culture often becomes a more important legacy than the first problem the organization solved.
But having healthy culture results in three things that make the mission possible. First, it allows people to come together on a common basis to work on problems as a group and not as individuals. Second, the culture is the foundation of the brand. And third, a strong company will conquer problems and move on to new ones, in other words: continually innovate.
A poor culture can keep an organization from its goals and can be a living nightmare for management. We go over five ‘crappy culture catastrophes’ in our article: Why Do You Need Company Culture?
Fostering a strong organizational culture does not have to be complicated. All you need to define is the qualities you want to see in your company, and what you are willing to hire and fire for to make sure the people in the company have those qualities.
Culture lives in the context of talent.
One cannot discuss culture without talking about talent. An organization needs a workforce of mixed skills, talents, backgrounds, and approaches to problems. We want these talented people to come together, and they come together around culture and mission. Culture being the values they share and mission being the goals they share.
Important parts of organizational culture are standards around talent. There are questions to be answered there: Is it ok to be average? Who’s responsible for employee development? What are the talent gaps to be filled that will propel your objectives?
In anything higher than an entry-level job, you would never hire someone who is a perfect culture fit but no demonstrated talent for the job. Too often we do the opposite: we hire a person with a rock solid resume who is a poor culture fit. Neither works out, so you need to consider both when hiring and performing succession planning.
Defining culture does not need to be hard.
Fostering a positive culture with a diverse, talented and passionate group of people can be nuanced and challenging. But many leaders are scared out of nailing the basics of culture and just try to go by feel. This is ineffective and puts too much pressure on the leader.
Creating a document that you can share with your team allows them to self-navigate teamwork, disputes, hiring and firing. Laying the groundwork early will make the work easy for people who take over the culture duties later in the companies growth.
All of the below should be captured in a presentation deck, booklet or letter.
Step 1: Define 4-7 beneficial traits.
Start by brainstorming personality traits you wan’t your organization needs. These traits are what your company will value moving forward.
The traits or values should be linked to your organization’s mission statement. What personality traits would help advance the organization’s mission?
The values should have a unique point of view. Reed Hastings, CEO of Netflix, makes the point that Integrity, Communication, Respect, and Excellence were carved into marble at the bottom of Enron’s building. Boring and uninspired traits that every company should naturally foster will not define your company from any other. And they will go in one ear and out the other of your employees.
I encourage you to brainstorm more traits, but pair them down to 4-7. Anything less than four values will not be enough to make decisions from, and any more than seven is impossible for the workforce to digest and memorize.
Example: Netflix traits are Judgement, Communication, Impact, Curiosity, Innovation, Courage, Passion, Honesty, and Selflessness.
Step 2: For each of those traits, define behaviors you want to see in the people you hire and promote.
Culture starts with who you recruit. The most common and effective way to hire is with behavioral interviews where candidates are asked to tell stories of past experiences with notable success (or failure.)
Did you ever define what behaviors you are looking for in their answers? Maybe if there were a technical skill you were looking for, you would look for examples where the candidate has solved similar problems to the one you are hiring to solve. This can also be applied to culture and is much more effective than just trying to get a feeling for someone.
Take the trait that you are trying to promote in your culture, and define what behaviors demonstrate that trait. Netflix has the values and behaviors side by side in their culture presentation deck.
These traits can also be used beyond the hiring process. You can use them in succession planning and employee reviews to promote people, give them raises and bonuses when they behave in these ways.
Example: We value Respect at BMB. Respect is exemplified when we see:
- Communication that is both honest and tailored to the listener.
- Appreciating others unique personalities, hopes and ways they want to be treated.
- Defending an employee, partner or customer from persecution or bigotry.
- Empowering and / or praising others contributions and roles.
- Gives negative feedback with the intent of improving the other’s future behaviors.
Step 3: For each of the traits from step 1, define behaviors that you are willing to fire someone for.
I would love to tell you that hiring for culture will be enough, and you will never have to fire someone for a poor culture fit. I would be lying.
If you want your culture to be real then it needs to have some teeth. There has to be predictable consequences to behaviors that damage the culture and the brand.
We are creating with this document is a compass with two cardinal directions. North are the behaviors we want to move towards, and south are the behaviors that we want to move away from. This will help us navigate around obstacles in the way of growth.
You can start with the inverse of the behaviors defined in step two. If you want more encouragement than you nauturally want less discouragement. Often defining the negative space can be easier than the positive; so this list may grow longer than your list from step two.
Example. We will use BMB’s trait of Respect again. Our virtue of Respect is violated when an employee:
- Lies to another employee to spare themselves negative consequences.
- Communicates in a way that impossible for the listener to understand.
- Judges someone’s value or assign traits to them based on their gender, race, age, socio-economic status, or a group they are affiliated with.
- Participates in gossip. Gossip is defined as talk they would not have if the subject was present.
- Considers themselves personally superior fellow employee, or a partner / customer.
- Gives negative feedback in a way that is destructive to a person’s self-worth.
- Taking personal credit for a positive outcome while diminishing the contributions of others.
- Attributing negative outcomes to specific people without providing feedback to that person, especially if this is expressed to customers or vendors.
- Any “us versus them” talk with employees, partners, and customers.
Document, share and celebrate.
You should be able to take the results of those three steps and create a document that lasts decades without needing to be revisited. You can break out this document when you need to hire, fire or promote someone.
It is up to you whether you would like to share some or all this document with the company as a whole or restrict it to managers and above. It is helpful to share it broadly as it creates an expectation of what behaviors will be rewarded and what behaviors will not be tolerated. An employee cannot say that they were blindsided when they are fired for culture reasons; they likely did a behavior that is already defined in the public culture document.
One last thing: if you have a company retreat or gathering, call out the people who have contributed to the culture just as you would someone who has contributed to the bottom line. Often these are the unsung heroes who create the environment where others accomplish great things.
This article is written by Colin Finkle with input from Jody Ordioni, Chief Brand Officer and President of Brandemix and author of “The Talent Brand: The Complete Guide to Creating Emotional Employee Buy-In for Your Organization.” See our previous interview with Jody and our review of The Talent Brand.
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