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Scaling culture in a fast growing, globalized company

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December 03, 2019 | Topic: Human Resources  
Scaling culture in a fast growing, globalized company

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.

Research demonstrates the impact of culture

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”.

The challenges that organizations can face with growth and scale

Fast-growth companies will face challenges with regard to their culture. Some of these aspects include:

  • Cultural clashes. A more diverse organization is undoubtedly positive. But as you grow, for example internationally, organizations bring on board individuals from different cultures. Those organizations most successful in their internationalization efforts, have leaders and role models who have the soft skills to ensure different cultures become a strength, rather than leading to misunderstanding and confrontation.
  • Growth itself and the need to invoke new procedures. As any company grows, there is a need for more defined processes and procedures. Without careful implementation, these can negatively impact culture.
  • Cultural dilution is a particular risk for professional services firms. When your people spend time on-site with clients, or work closely every day with clients, your culture can start to become diluted by the impact of the client’s business.
  • The emergence of subcultures. With growth, and the increase in your workforce, subcultures can emerge, which can negatively impact your overall culture.

Steps to scale your culture

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:

  • Create cultural committees for each location. One of the most important actions we’ve taken is to put together a cultural committee for each office. The committee may include people from your human resource teams, but it’s important to include other individuals as well. The committee is responsible for finding ways to build, create, and transmit your culture. For example, we decided to change our induction process for new employees based on the committee’s recommendations, to strengthen how we communicate Belatrix’s high performance culture.
  • Recognize and support cultural ambassadors. Recognize those individuals who embody your culture – and who can help transmit this culture to both new and existing team members. Make sure budget is available, for example to help recognize these people, but also when necessary to enable them to visit different offices.
  • Create a specific plan for communication. Effective communication doesn’t just happen, but needs to be managed proactively. Such actions will include everything from ensuring your merchandising helps reinforce your values, to ensuring leaders receive storytelling training, so they can communicate the “why” of your organization.
  • Measure and analyze via regular engagement surveys. While this may seem like a standard measure that almost every organization undertakes, it is still one of the most valuable tools. Carefully choosing the questions to reflect the motivations in the TOMO model that I mentioned earlier, enables you to empirically track how your culture is shifting in your organization. For example, you can link different questions to direct and indirect motivations. Then by segmenting the data you can see sub-groups, or see what is happening in offices in different locations, or within people of different seniority. It’s then possible to link this to other data you collect, such as feedback on your workplace environment. Ideally, organizations can use engagement surveys as a diagnostic tool that they can then build concrete actions upon.
  • Look to industry best practices. Some companies have managed to create a culture which defines who they are and is a significant contributor to their success. Experts regularly cite companies such as Apple, Southwest Airlines, and Whole Foods. These are companies which have taken specific steps to define who they are and what they stand for. I am constantly looking at industry leaders to see what they are doing, reading the latest research on the factors that impact performance. Then together with the team at Belatrix we evaluate these ideas and then where appropriate implement them.

Discover and emphasize your organization’s “why”

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.

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