GROWING THE CORPORATE CULTURE

By Douglas Stewart

...and that's the way things are around here.
—Steelworker, 1983

Webster's defines "culture" as "the ideas, customs, skills, arts, etc. of a given people in a given period." Astute managers have realized that an organization also has its own corporate culture. Social anthropologists are now as fascinated by corporate cultures as they once were by head-hunting tribes in Borneo.

Why is business now interested in areas once reserved for the Margaret Meads of social anthropology? The answer is simple – profitability. Research into organizational productivity indicates that the equation goes like this:

Work culture = productivity = profitability

If increased profitability is an organizational goal, one of the best places to start improvements is with an examination of the organization's work culture.

What do we mean by a work, or corporate, culture? Basically, it is the sum total of the formal and informal systems by which things happen in an organization. It is the information that precedes the statement "...and that's the way things are around here." The work culture reflects not only the organizational flowchart, but also who really has the power to make things happen, and how that power is used.

The strongest component of the work culture is the beliefs and attitudes of the employees, the people who make up the culture. If these cultural norms contain beliefs such as, "Around here, nobody dares make waves" or, "Do just enough to get by and people will leave you alone," the organization's performance will reflect those beliefs.

On the other hand, if the cultural belief system contains positive approaches, such as, "Winners are rewarded here" or, "People really care if you do a good job in this outfit," that also will be reflected in the organization's performance. No amount of high-sounding corporate slogans or mottos will really influence bottom-line performance unless the employees' belief systems have created a productive culture that is in agreement with the organization's mission.

Influencing the culture

What creates and influences the culture? There are several major factors:

The manager's behavior. Studies indicate that the single greatest influence on the work culture is the manager. As Chrysler chairman Lee Iacocca says, "The speed of the boss is the speed of the team."

Employees soon realize that the best way to get ahead in an organization, while staying out of trouble, is to pay attention not so much to what the manager says, but to what the manager does. Actions, in fact, do speak louder than words. The belief system of the manager, as indicated by the manager's behavior, will usually be mirrored by a significant number of employees.

Employee selection. Some of the major high-performance organizations, such as IBM, carefully select their employees to fit in with the existing corporate culture. They become "IBM-ers." Not everyone, of course, may want to work in such a uniform culture, but it does produce a highly productive organization, as well as very low employee turnover.

The nature of the business. Some businesses have long-established cultures, either as individual organizations or as professions. For example, there are certain beliefs common to the newspaper business, whether you work for a small daily in rural Iowa or a large New York tabloid. The legal profession has a common culture, no matter which aspect of the law you practice. So do long-distance truck drivers, nurses, or jockeys. Most professionals bring a set of cultural beliefs with them, regardless of where they work.

The exception to this may be in new industries such as electronics, where neither the job roles nor the products even existed a few years ago. Firms in California's Silicon Valley, for example, literally had to build new corporate cultures since no models existed in their industry. According to consultant Rober Bly, this culture has developed into one of "high turnover, long work hours, intense enthusiasm for one's work, technology as king over marketing or the customer – and everyone's goal is to be an entrepreneur, not a vice-president."

This can create excessive employee stress and tension, and drug use, alcoholism, and divorce are reported to be higher than normal in those industries.

The external culture. An organization's internal culture can be strongly influenced by the culture of the community that surrounds it. Americans who set up businesses abroad soon learn that they must respect the local cultural beliefs if they expect to have a smoothly functioning organization.

Improving the culture

Since the nature and quality of the work culture seem to have a direct effect on organizational performance and profitability, managers understandably want to know how their work cultures can be improved. If this is an issue for you or your organization, here are some suggestions.

Establish a clear corporate mission. It is amazing how many organizations can't state in simple terms the reasons for their existence. Try it for yourself by completing the statement, "This organization exists for the purpose of..." If this proves difficult, you have discovered a good place to start improving your work culture.

A clear and easily understood organizational mission statement makes it much easier for people within the organization to set priorities, make decisions, and determine values. It lets you know who you are as an organization. It helps everyone in the organization answer that most basic question, "What am I doing here?"

An equally important component of the mission statement is that all of the organization's members be able to complete "The purpose of this organization is..." and arrive at much the same answer as does upper management. Many managers seem to assume that employees can do this, without ever really finding out.

Check it out for yourself: Have the member of your organization or work unit take a few minutes to complete the statement anonymously. Compare their statements with what you think is the purpose of your organization. The differences may astonish you.

It is imperative that managers clearly communicate to all members of the organization what the purpose of the organization really is. Without that understanding, employees do not feel that they are essential to the organization, its functions, or its future direction. They "just work there." The results can be mediocre job performance, absenteeism, low corporate loyalty, and high turnover. People only stay on a train as long as they have a clear idea of where it is going, and as long as its destination is the same as their own.

Keep the mission up front. Once an organization's purpose has been clearly established, the manager must ensure that it is continually kept in front of the organization's members. These should be words that the organization lives by, not words stored in the janitor's closet, and they need frequent reiteration. It isn't enough to remind employees at the annual company picnic or the yearly sales meeting; it must be done on an ongoing basis. It would be hard to maintain a religion in a culture where everyone comes to church on only one religious holiday.

Managers must reflect the desired culture. When an organization's mission and purpose have been made clear to all of its members, the manager must determine what behaviors are consistent with the desired culture and set an example of them.

For example, if clear communication is important, then it is up to managers to recognize and reward it, as well as practice it themselves. If positive attitudes and beliefs are needed, then they must come from the top.

Employee learning must be ongoing. To generate a performance-oriented work culture, employees need to expand their skills and knowledge continually. They need to know what the organization expects in the way of quality products or service and how to achieve it. They need to be coached through new situations and helped to learn from any mistakes.

Employees also need to be encouraged to try new ideas, methods, or approaches, so that organizational problems can be solved in innovative ways. Only in this way can managers develop a sufficiently supportive work culture to imaginatively solve the increasing number of problems brought on by an accelerated rate of change.

In conclusion

An organization's cultural norms are so all-pervasive that they are almost invisible, but if you would like to improve performance and profitability, norms are one of the first places to look. Ask yourself what employee beliefs or attitudes, including yours, relate to the question, "How are things done around here?" When you have the answers, you'll be on the track to understanding your own corporate culture and its relationship to organizational performance.

The successful manager cannot leave the development of a high-performance work culture to chance if the business is not to risk its very future. Fortunately, that needn't be the case. An alert manager can take the necessary steps to ensure that the quality of the work culture matches the quality of the organization's products or services.

The quality of the work culture and the quality of employee performance go hand-in-hand. It is up to the manager to determine along which path they'll walk.

Email This Page     Printer Friendly Version