When many of us think about company culture, it seems to include Friday drinks, table tennis, birthday cakes and the clothes we turn up to work in. It’s often the tangible things that allow us to identify a specific reason why we believe the company is one way or another. The reality of company culture is very different however. What many people think of as culture is simply a segment of it. They’re fleeting ideas to stitch together in an attempt to appease employees’ appetites. It’s a shame, because there’s a lot of evidence to suggest real company culture makes a considerable and direct impact on a business.
“Culture eats strategy for breakfast” – Peter Drucker.
In 2012, the Columbia University showed that the likelihood of an organization with rich company culture is a mere 13.9 percent, while the probability of job turnover in a poor company culture is 48.4 percent. According to the Department of Economics at the University of Warwick, happy workers are also 12 percent more productive than the average worker, and unhappy workers are 10 percent less productive. At New Century Financial Corporation, a U.S. specialty mortgage banking company, executives in the wholesale division who were actively disengaged produced 28 percent less revenue than their colleagues who were engaged. Furthermore, those not engaged generated 23 percent less revenue than their engaged counterparts.
Developing company culture
Company culture is more than just making people happy with perks, however. While perks make us happy in the short term, it’s not long before we become accustomed to them. The appeal fades and we’re left feeling empty, despite getting what we thought we wanted. Rather than giving perks, true company culture is about making people feel a part of something bigger than themselves and pursuing a purpose. It’s about appealing to the stronger desires of people and making them feel like they’re valued, growing and making a difference. Doing that, involves much more than a slab (or carton) of beer and a pat on the back at the end of the week. Building a true company culture involves quite a lot of digging on the leaders part. It means having a defined set of beliefs, values and purpose (aside from making money and delivering your product/service), and then acting on those beliefs, values and purpose. Rather than offering free food, take the time to listen to employees. Ask for their feedback, help them to grow and give them guidelines to work towards a purpose that’s about more than just making money. Explain to them how their work is contributing to a higher purpose or a making a meaningful difference in the world. To give you an example, the brand ‘Life is good’ states their vision as “a world where all children grow up feeling safe, loved and joyful.” Their mission is to “dedicate their lives to helping children overcome poverty, violence and illness.” If you didn’t know the brand, you’d think they’re a charity working in a third-world country, whereas in reality, they make t-shirts. The difference is, ‘Life is good’ understand why they make t-shirts. They believe and act in line with their values and this creates a company culture. Patagonia states their reason for being is to: “build the best product, cause no unnecessary harm, use business to inspire and implement solutions to the environmental crisis”. Zappos core values are:
- Deliver WOW through service
- Embrace and drive change
- Create fun and a little weirdness
- Be adventurous, creative, and open-minded
- Pursue growth and learning
- Build open and honest relationships with communication
- Build a positive team and family spirit
- Do more with less
- Be passionate and determined
- Be humble
All of these companies have guiding principles and reasons for employees to engage with them on a much deeper level, rather than simply getting a few perks; and because their employees are engaged, so are their customers. If you want to create true company culture, I’m not saying you have to throw away the ping pong table and cancel friday drinks, but it’s important that you think about what your business stands for and whether it’s something you think others would really want to be a part of. For more posts this week, see: