5 Steps to Creating an Awesome Culture

I was recently asked to give a talk to a group of manufacturing professionals on the topic of culture. Having been in industry for a couple of decades, I’ve seen a large variety of organizational cultures and the effects that an organizational culture has on its members, their general happiness, and their productivity.

We all know that culture matters. Drucker is famously quoted with the phrase “culture eats strategy for breakfast” indicating that the best strategy and plan can easily be overcome by a poor organizational culture. Consider these statistics:

• Companies with strong cultures saw a 4x increase in revenue growth (Forbes)
• 94% of executives and 88% of employees believe a distinct workplace culture is important to business success (Deloitte)
• Over a period of seven years, companies with more engaged workers grew revenue 2.5x as much as companies with less engaged workers. (Bain and Company)

Obviously, having a strong culture of engaged workers can yield tangible results. But culture is a difficult thing to define. Perhaps that’s why this statistic is so meaningful:

• Fewer than one in three executives (28%) report that they understand their organization’s culture. They know culture is important, but don’t understand it. (Deloitte)

The impact of culture can, however, be measured pretty effectively by the engagement of the organization’s employees. If you have a high turnover, low productivity, high absenteeism, high safety incidents, missed deadlines, poor quality, and missed deliveries, chances are your culture stinks. Here are some steps you can take to start fixing your culture today, even if you can’t define it.

Create a Vision - Articulate the “Why”

It is much easier to motivate and inspire employees to achieve if they know the ‘why’ behind the ‘what.’ Simon Sinek states “People don’t buy what you do, they buy why you do it.” People are naturally hard-wired to respond to a story and articulating ‘why’ tells a story. Simply telling people ‘what’ to do is a command, and we all know how responsive we are to commands.

Take for example, a pharmaceutical company which makes exciting, cutting edge drug treatments. They struggled with turnover and employee engagement across the board was tanking. Customers weren’t getting their orders on time and were threatening to leave, which fueled a feeling of despair. Everyone at this company knew what they made – many had advanced degrees in the subject – but no one really thought about why they made what they made.

Think of how this company could have built a compelling vision for their employees which rallied them to a common, noble cause. For example: “The reason we work hard to develop things no one else ever has, is because there are millions of people suffering every day with diseases that our products can cure. We are in the business of saving lives and making sick people well. That is why we come to work on-time every day and give 100% of our efforts – to make people’s lives better.”

Contrast this with the message the employees were given which generally revolved about coming to work on time, meeting shifting deadlines, and working harder instead of smarter – blah, blah, blah. Which message do you think would generate higher engagement? Which would excite and motivate the team towards achieving a common vision? Which message builds a culture of excitement and which builds a culture of tedium?

Respect for People – Show You Care

We often teach Aristotle’s Four Needs to our customers which are: 1) to love and be loved; 2) to be challenged; 3) to be heard and understood; 4) to be part of something bigger. While we can unpack a lot from these four needs, the first one – to love and be loved – is a great one to focus on if you want to improve your culture. People are social animals and don’t put their need for connection with others on pause when they enter the office. If you, as a leader, are dispassionate, aloof, and uber ‘professional’ you are missing a wonderful opportunity to get more engagement – and therefore more – out of your teams. Creating a personal connection with your teams, truly listening to their suggestions, and being visibly helpful shows that you care about them as people, not as ‘human capital.’ And because the balance of power in business rests with the leader, the leader is responsible for taking the first step.

I’ve always admired Lou Holtz, the legendary football coach at Notre Dame, and he sums this up very well. His secret to getting the most out of his teams is to 1) do the right thing; 2) do your best; and 3) always show people that you care. I couldn’t agree more. If you show your people you care about them, their families, their goals and dreams, they will work hard for you. If you treat the relationship as transactional, they will, too. And why would anyone do more than the bare minimum in a transactional relationship?

Oh, and as I was taught during my military service regarding officer/enlisted interactions, “You can be friendly without being friends.”

Give Power Away – Don’t Hoard It

Leaders often struggle with this step, especially those new to leadership roles. After all, their hard work and expertise in an area is what got them to the powerful role in the first place! Leaders often feel that the decentralization of power makes things harder to manage. However, not delegating this power not only creates a decision-making bottleneck, it also sends an implicit message that the leader doesn’t trust his or her team.

Contrast this with the organization where power is freely given. In these environments, employees feel they are trusted to make decisions. They take ownership of their areas of responsibility and feel accountability for their work. They freely share information and collaborate with each other, because they don’t fear for their jobs.

Leaders need to get over the idea that their jobs are to wield power and control; this is only effective in campy, unrealistic military movies where one individual has all the answers and barks all of the orders. In reality, the military is built upon the concept of delegating power. How effective would the Army be if the regimental commander made every decision for the regiment? Or even if the company commander did? Kind of hard to make battlefield decisions when all of them funnel through the top, right?

Kill Office Politics Dead

A study I came across (not sure of the veracity) said that 43% of the general time wasted by an employee is centered around office politics. Since people are only productive about 75% of the day, that means the average employee wastes 51.6 minutes per day on office politics. That’s about 170 hours a year, or over 4 weeks dedicated to activities that are not just wasteful – they’re downright sinister. And even if the stat is half wrong, that’s still two full person-weeks of time wasted on something that will only drag your teams down.

You know what I’m talking about – the water cooler talk, the gossip, the backstabbing, the snide comments. But I’m also referring to two equally insidious types of office politics: the first involves how we (as people) think others will think about us and the second involves individuals exploiting their position to influence others. These types of office politics manifest themselves in comments like:

• “I didn’t want to speak up, because my manager thinks it is a great idea.”
• “I don’t think that’s the right priority, but the VP said it was.”
• “I didn’t agree, but I’m only the lowly {insert entry level position title here}.”
• “I always add {important person} as a BCC on my emails to cover my, ahem, bases.”

These types of office politics stifle open and honest communication and a sense of collaboration and teamwork. After all, the people best equipped to solve problems in your organization are those closest to the work. If they’re afraid to step up, your organization will be mired in unproductive mediocrity.

Eliminating the arrogance associated with positional authority and creating an environment where all employees’ opinions are equal and can be openly expressed will make your teams stronger, build trust and collaboration, and increase your ability to solve the really difficult problems.

Oh, and stop the water cooler gossip, too. That stuff is a cancer. We’re not in 7th grade anymore.

Address Poor Performance

Low performance by a team member can obviously bring down the productivity of the team. Even worse, it can undermine morale as people either see their time being wasted or find themselves forced to compensate for the lag.

Consider an organization with 10 members. Probably 2 or 3 are gung-ho go-getters. We’ll call them the A-team. There are probably 2 or so that are poor-performing anchor-draggers (the C-team). The other 7-8 people (B-team) are watching to see how the leader approaches this situation. If the leader tolerates the poor performance of the C-team, it is likely that others in the middle group will start to underperform as well. After all, why not? They can get paid the same for delivering less, right?

However, your A-players are usually going to be A-players no matter what. Their drive to excel is in their nature. They’ll pick up the slack for a time because that’s just who they are. But everyone has a breaking point. If they are doing twice as much work with twice the stress for the same money, they’ll join the 51% of people actively looking for a job and go somewhere their efforts are appreciated. Then you’ll be stuck with a bunch of C-players. Doesn’t that sound fun?

Key takeaway here: address low performance as soon as you see it if you want to build a strong culture!

Conclusion

Culture change can be extremely difficult and take a long time, which is probably why many executives do little or nothing to try to improve it. However, the results of a strong culture of trusted, empowered, and engaged employees can truly transform your business, delight your customers, and make your organization happier and healthier. I think the hill is worth the climb . . . do you?