As the saying goes, “culture eats strategy for breakfast”. But for fast growing companies, how do you maintain your culture? How do you avoid losing it, as you bring on-board more people, have more defined processes, and you move away from being a youthful start-up?
All too often we’ve seen companies that have a “bad” culture suffering from its consequences. Many of the issues faced by Uber can be attributed to a sexist, aggressive, and discriminatory culture. Such was its impact, Uber mentioned it in its IPO filing under risks for future profitability, stating “Our workplace culture and forward-leaning approach created operational, compliance, and cultural challenges”, which have “in the past harmed, and may in the future continue to harm, our business results and financial condition.” This “forward-leaning approach” is an interesting euphemism for Uber’s former CEO’s Travis Kalanick’s “always be hustlin” style. But it’s a good example of what can happen if you allow a toxic workplace culture to foster.
My advice when talking to startups is, from the very start, have a zero-tolerance approach to politics, or unethical or harmful behavior. But beyond this, how do you create and scale a high-performing culture that will define your organization. That’s what I want to explore in the rest of this article.
Academic research is clear about the impact of culture on business performance, both positively and negatively. Studies consistently demonstrate that having a great culture, leads to improved results. And there’s a lot that organizations can do to actively create a sustainable, high-performing, culture. It’s not something you leave to chance.
As John Kotter and James Heskett write in their book, Corporate Culture and Performance, “cultures can be very stable over time, but they are never static”. Thus creating a strong culture is something leaders, managers, and everyone in the organization needs to constantly work at. The more your organization changes, the more you need to invest in maintaining and improving culture.
Their research demonstrated that corporate culture can have a significant impact on a firm’s long-term financial performance. Those with great cultures, significantly outperformed their counterparts. Meanwhile, the opposite is also true, and unfortunately occurs frequently: “corporate cultures that inhibit strong long-term financial performance are not rare; they develop easily, even in firms that are full of reasonable and intelligent people”.
Fast-growth companies will face challenges with regard to their culture. Some of these aspects include:
So what are the key steps you can take to ensure you don’t lose your culture, as you grow and scale rapidly. This is a unique challenge that will face many organizations during their growth years. Here at Belatrix we have been achieving over 30% annual growth for the past five years, which correspondingly puts pressure on everything from your processes, to yes, your culture. At the same time we’ve been repeatedly recognized as a great place to work, and also as a top workplace for millennials.
We’ve been influenced greatly in our thinking by the book, Primed to Perform. Based on their research, the authors define a simple motivational model, called TOMO, or total motivation. The model states that there are six key motivational factors. The first three are play, purpose, and potential, which are connected to work itself. The next three are indirect (negative) motivations, which are emotional pressure, economic pressure, and inertia. As the authors state, great cultures create play, purpose, and potential, while they minimize emotional pressure, economic pressure, and inertia.
Based on our experiences I recommend organizations take the following actions:
As the authors of Primed to Perform write, “to build a high-performing culture, you must first understand what drives peak performance in individuals. The answer sounds deceptively simple: why you work affects how well you work”. Thus an organization’s “why” is a core part of what drives performance.
Ultimately an organization’s culture can, and should be, a competitive differentiator. It’s incredibly hard to replicate a great culture. At the same time it will also help you outperform your competition and adjust nimbly to a changing marketplace. But it’s not something which will simply happen- it requires an intentional, systematic approach, from individuals throughout the organization.
July 08 / 2020
April 23 / 2020
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