How to build a winning company culture

So how can you steer your culture in the right way? In short by:

• Identifying the culture you already have
• Defining where you want it to go
• Making sure you have a set of core values
• Outlining which behaviours will uphold those core values (and which will harm it)
• Making sure your executive team lives your values
• Correcting people across the organisation who aren’t upholding culture
• Hiring for culture fit and culture add

In this eBook, we drill into the core of these topics so you can create a winning culture that drives your business forward.

We’ll also take a look at the major dos and don’ts of culture that our experts have learned the hard way.

This is a valuable 12-minute read but if you only have two minutes, you can jump to the key takeaways.

Myth:

Company culture is mainly an abstract thing but can be expressed through a company’s social events, work trips, parties, and coffee catch ups which keep current employees happy and help attract new ones.

Reality:

Company culture is a set of behaviours that demonstrate a company’s values and determine how every individual within a business works, thinks, behaves, and grows.

Company culture touches everything – the way you approach clients, the way you set financial targets, the way you make decisions, the way you prioritise, the way you reward people for their work, who you employ. It even touches whether your employees wash up their coffee cups or leave them for colleagues to deal with.

When executed well, culture brings purpose and clarity to your company’s approach. It shows everyone in the business where the company is going and inspires them about the active role they’ll play in getting there.

When businesses don’t live their culture values, it creates a gap between the model they’ve set out and the way their company is perceived. The most successful businesses stop this gap from forming, or find ways to close it if it does form.

Reaching this point is a process, not a quick fix. The first step is thinking about what your company really stands for and what you want it to achieve.

To kick things off, bring together a select team of senior leaders, led by your CEO, to answer some key questions:

• What’s ‘the why’ of our business?
• How do we solve our customers’ problems?
• What are our solutions?
• What’s the primary goal of our business?
• What are our core values? (What behaviours will help us realise our goals)?
• How present are they now?
• How will we reward or encourage those behaviours?

So your core team has worked out what your company culture is and defined where you want it to go.

Don’t make the mistake of thinking this is the end of the road (you’d be surprised by how many businesses do).

Your next move is to get everyone rallied behind your culture. The first step of this is to articulate your mission (why do we exist?) and your vision (where do we want to go in the long term?) so that everyone knows:

• Why you do what you do
• Where the company is heading
• The problem you solve (‘the what’ of your company)
• Your product (‘the how’ of your company)
• What makes an ideal customer
• What makes you different from the competition

Understanding these points will then inform the next step – your core values.

These core values will become the principles that guide how you act, take decisions, expand, recruit – and everything in between. They’re an outline of the behaviours you believe will bring your company goals to fruition in the most effective way.

Culture measurement

So your leaders are carrying culture and shining a light on the culture bearers in various teams… how do you know if it’s having a positive impact? By objectively measuring your culture.

Word of warning. Metrics are super useful but don’t forget your leaders will also need to talk to your employees regularly to gain qualitative feedback.

The best way to do that is to meet people in person. You can then combine your feedback from these conversations with the metric data you’ve been capturing.

The best ways to get that data is using:

• Pulse survey scores: These surveys ask employees to rank their agreement with a series of statements about the company. By looking at scores to prompts like “I am proud to work at the company”, or “I understand our company’s mission” you can gain a lot of insight into the effectiveness of your culture. If you want them to be effective, run pulse surveys weekly, bi-weekly, monthly – not once a year.

Two key measurements on a pulse survey:

• Employees Net Promoter Score (eNPS): These measure the extent to which employees would recommend your company as a good place to work. This is a great way to proactively health check your culture. – Engagement: This measures the participation and completion rate of your pulse surveys. If only a handful of employees fill out the pulse survey – it’s a clear indication that engagement is low.

• Employee churn: If people are leaving your company in droves, something isn’t right. But equally, if no one ever leaves, it can indicate problems too (albeit more subtle ones).

For example, extremely low employee churn can indicate that employees are complacent or undesirable to recruiters as they’re not progressing. Keep an eye on employee churn – seek feedback in exit interviews, and stay on top of performance reviews.

• Candidate pipeline: If you have vacancies and very few applicants, or a lot of interviewees but a lot of offer rejections, chances are your culture isn’t making your workplace a competitive proposition. Being able to use your network to build a pipeline of candidates even when you don’t have open vacancies is a sign your culture is on the right track.

Culture measurement contd:

Be warned: there’s one thing that will make all your measurement efforts pointless – not acting on your findings.

The first stage of that is getting specific on what you’ve actually discovered. Dividing your figures by gender, office, department, age, and number of years in the company will help you identify where the problems lie and inform the best course of action.

Say teamwork is a core value of your business.

If you give a promotion to the highest performing sales person who regularly cuts out the onboarding team before the deal is closed…that sends a very clear message to your employees. One that suggests the core value isn’t teamwork at all, but rather – sales above process.

So congratulations – you’ve got your people rallied behind your mission, they’re using your guiding principles to inform their decisions, you’re measuring and maintaining your culture, and (thanks in no small part to this cultural alignment) your business is growing.

But growing businesses hire more people – some even acquire other businesses. Which presents you with a new problem: how do you develop your culture as your business grows?

You have two main tools at your disposal: hiring and onboarding.

Hiring

Culture fit covers candidates you think are a good match for your company. If you’re a business with a very collaborative culture, hiring a maverick that likes to make rogue decisions isn’t a good culture fit.

But businesses that stand still get left behind. And since culture is directly related to the overall performance of your business, it needs to evolve (groupthink can quickly put innovation in a chokehold).

To remedy this, you need to move away from hiring people exactly like you by adding a dose of culture add as well.

Culture add means attributes outside your current culture template. For example, say a pillar of your culture is ‘consideration’ but you’ve noticed that this can lead to a lack of clarity in decision-making. When you’re hiring a new team member, you might want to consider someone who brings more confidence and direct communication skills into the mix.

Are subcultures bad?

As a rule, subcultures dilute the effectiveness of your culture overall.

But if you’re expanding into a new region, a subculture in your regional HQ can actually help. That’s because the demands on this satellite department will be different. For example, they might need a more entrepreneurial mindset than your core business (not to mention a heavy dose of local knowledge).

The key is to make this a variation of the culture template you already have, not a completely new template. Moving a key player like a product expert from the mothership is a great way to facilitate that. They’ll know the culture of the company – and will be able to help instil the core principles of it in the new location.

Onboarding

Onboarding employees to your culture is all about patience.

Software businesses move fast so it makes sense that you want new recruits to hit the ground running. But rush the cultural onboarding process and you’ll soon find you’re causing culture damage – especially if your new recruits are senior hires or if you’re merging workforces after acquisitions.

This is where doubling down on culture carriers and culture bearers is vitally important. Set the standard and give new recruits the time they need to understand things and get up and running.

A great way to kickstart this process is to match each new starter with a buddy who can help model behaviours that will uphold the company’s core values.

It’s also crucial to give people across the company opportunities to contribute to your culture – this helps them feel involved in the development of the company overall.

Check for culture clash before you acquire a company

When you approach an acquisition, get rigorous with your cultural due diligence process. Approach the acquisition as if you’re hiring the other company and everyone in it. If they’re not a good culture fit and culture add – be prepared to walk away.

Culture is a slippery thing and the potential for mistakes is sky high. To help you navigate this tricky path, here are four our experts have learned the hard way…

Underestimating the breadth of culture:

The biggest mistake is assuming that culture is all about pizza parties or office drinks. Remember the reason people work for your company should be because they believe in the job itself and the way you create value for your customers.

So while events can be part of a healthy company culture, they’re not the culture itself. Because (once more for the people at the back), culture is a shared set of behaviours, values, and practices that touch every aspect of your business. It’s also a crucial way you can differentiate from your competitors – even great pizza can’t help you do that.

Treating culture like an ornament:

Some businesses set their values during a company conference, print them out, slap them in a frame, and leave them on a wall in the office to collect dust. If that’s how you treat culture, it’s how your employees will too. Company cultures are living things that touch everything you do – they need to be continuously practised and nurtured.

Not measuring how your culture is experienced:

Culture can be monitored and tracked, just like anything that impacts your bottom line. The data you capture from culture measurement can reveal how engaged and motivated your workforce is. Once you have this data you can actually do something about it.

Letting some employees snooze on culture:

Businesses often have a situation where a high performing employee doesn’t behave according to culture. If you let this go on unchecked, you’re making a big mistake. Bad culture role models sow the seeds of culture damage everywhere. Empower your employees to change their ways and commit to culture…and don’t be afraid to let them go if they repeatedly refuse to engage with it.