Better Mondays - Chapter Seven
The Importance of Corporate Culture and Its Influence on Your Career
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Chapter Seven - The Importance of Corporate Culture and Its Influence on Your Career
“In a company with a great culture, the backstabbing only produces a flesh wound.” – Roger A. Reid
Defining organizational culture is like trying to describe all the patterns and variations of color in a kaleidoscope. Not only will the descriptions vary by individual, the significance and meaning of what they see will also differ. For example, some might find the colors soothing and a welcome break from what they were doing. Others will think it’s a silly waste of time.
It’s the same with culture. While most of us can describe the idea of culture in broader terms—using phrases like, “that’s the way we do things around here,” or “it’s the way we act and interact with each other”—attempting to pinpoint exactly what culture means to the employee tends to generate as many different answers as you have people contributing an opinion.
For some, it’s the environment and work style, with perks like a park-like campus, unstructured work areas, flexible hours, and a lunch cafeteria offering ten flavors of yogurt. Others set their priorities on the intellectual competence of their co-workers and the opportunity for advancement into management.
Why such a difference in our individual perceptions of culture? Because over the last two decades, the cultural ideal has evolved from an often nebulous set of “higher values” and principled standards to tangible, value-added advantages for the employee. In short, what was traditionally expressed in paragraphs of flowing rhetoric—usually a vague description of the company’s ethical responsibility to “do the right thing”—has been transformed into tangible benefits, often including an employee-centered environment where comfort, convenience, and activities designed to meet personal needs are integral to the workplace.
This transition has accelerated over the last decade, especially with millennials moving into positions of upper management in the workforce. As a result, a company’s culture has become fundamental to its identity. It’s not unusual for college seniors to evaluate a potential employer solely on its culture: “I think Company A has a better culture, so that’s the one I want to work for.” Or, “You wouldn’t catch me talking to anyone from company B. Its culture sucks.”
This “New World” concept of organizational culture is becoming such a commonly used yardstick to measure a company’s environmental, physical, and intellectual benefits, that even the most every-day and commonplace features of a company’s landscape are often interpreted as intentional expressions of culture. In this context, culture can mean anything from covered parking spaces to casual Friday.
The result? As our perception of work culture shifts more toward an expression of tangible benefits, the idea of creating a positive, productive workplace becomes less about a sacred mantra of principles, vision, and values, and more about campus gyms, on-site daycare, and a staff nurse handing out vitamin C pills during cold and flu season.
And that’s dangerous.
With cost-intensive benefits masquerading as cultural imperatives, the waters of entitlement have gone from murky to muddy. Especially since the growing pool of “desirable conveniences” are commonly, yet mistakenly used as metrics to measure the presence, effectiveness, and value of a company’s culture.
When the money is flowing and profits are up, culture—under our New World definition— is a many-faceted reflection of the bottom line. Unfortunately, that’s also true when the intersecting lines on the whiteboard show profits plummeting through the floor.
This makes profits and culture—when measured as tangible, value-added employee benefits—not only interrelated but lock-stepped in co-dependency. Make no mistake: It’s money first, culture second—ALWAYS. If you doubt the priority, try rating the culture behind the locked doors of an abandoned manufacturing plant.
Let’s look at a real-world example. Why does Google have a much-envied work environment that continually puts the company on everyone’s list of top places to work? Because Google makes lots of money. Their income is presumably in excess of what is required to pay the ongoing cost of payroll and salary, debt service, research and development, physical plant maintenance and replacement, employee benefit packages, upper management perks, and stockholder dividends.
So when given the choice of whether to pay taxes on windfall profits or use tax-deductible funds to the symbiotic benefit of employees, in the words of the most conservative accountant, “Why not?”
As long as the money continues to flow, life is good.
However, things can change. Markets crash. Customers can lose their financial ability to purchase your products or services. The competition can reverse-engineer a company’s core product and duplicate it for a tenth of the cost. And for the sake of the organization—for its survival—the hard influences of financial continuity must take priority over the softer aspects of culture. The result? All those nice benefits previously delivered under the guise of “culture” must be curtailed.
The concept is about as straightforward as it gets—the company must cut non-essential spending due to a drop in income, profit, or both. And yet, employees often feel betrayed and even resentful when value-added benefits are lost due to the hard realities of reduced cash flow, industry downturns, and a hundred other situations that can affect the company’s bottom line.
Under the New World definition of culture, employees must understand how the realities of business can affect their jobs and future security. They should realize the company isn’t bulletproof and needs their support and dedication to thrive economically through both good and lean times.
If you’ve been following me so far, you should be getting the idea that a healthy culture is a two-way street. Ideally, it promotes or provides personally-valued benefits to the majority of employees. In exchange, the company expects to profit from increased employee productivity, loyalty, and engagement. Which brings us to the sobering conclusion that the more the company’s culture is measured in the form of tangible benefits, the more the culture is dependent upon the financial success of the company.
Here are six fundamental truths about company culture:
1. The concept of organizational culture is in transition. Previous definitions of culture usually focused on three primary areas:
(a) The way—the how, when, and where—the majority of employees do their job, especially when responding to a customer request or problem.
(b) The methods of management—how many levels, how much authority, and the quality and consistency of communication (often the degree of transparency) between management and their subordinates.
(c) The level of employee empowerment, and how an individual’s responsibility compares to their authority to get the job done well and on time.
And while those descriptions are still accurate, a new and younger generation of workers is expanding that definition to include tangible benefits that directly affect the employee’s experience in the workplace. As this transition continues, this “New World” definition—and the expectations it creates in the minds of employees—will make the tangible extensions of culture more dependent on the company’s financial bottom line.
2. Every company has a culture. A lingering point of confusion is that a company must formally institute a cultural agenda, or at least define what their culture is—otherwise, it doesn’t exist. But in reality, every business has a culture. If it isn’t formalized, or defined by policy, example, or from the expectations of management, then it exists by default. It may be good, bad, or downright toxic, but make no mistake, every business has a culture.
3. Culture—whether it manifests itself in psychic or material benefits—is, ultimately, an expression of profit. Nothing more and nothing less. It takes its form and longevity from the business activity that allows it to exist. When profits are on the rise, a company’s culture typically expands, creating a more tangibly apparent, benefit-enriched environment. Conversely, when business is in decline, culture must contract, eliminating financially-prohibitive actions and benefits while management becomes less flexible in evaluating and satisfying employee-centered expectations.
4. A cultural statement containing words like “beliefs, values, and principles” is suspect at best. Unifying the belief systems of a diverse workforce carries a degree of difficulty similar to walking on water. In its most practical incarnation, it can influence recruitment (attracting people of a similar mindset), but even with the best of intentions, a “like-minded hiring policy” is far too subjective to be useful, and in a worse case situation, can be misinterpreted (or manipulated) to be an infringement on a protected class.
In reality, corporations have objectives, goals, and plans. If beliefs and values are going to enter the picture, they will originate from the company’s owners and board of directors, who are influenced by personal agenda, financial goals, and traditional industry practices. These inputs may determine the “scheme of things” at that point in time. The results are decisions and policies that affect the work environment and influence how employees and customers perceive the company—until they change.
5. Realize that authentic transparency is a fantasy and is rarely (if ever) practiced voluntarily. Revealing the hard truths of intention, motivation, and purpose is counterintuitive to the mindset of upper-level management. Their rarefied world has always contained privileged secrets. For example, maintaining the financial well-being of the stockholders may be an obvious company responsibility, but revealing its priority to be higher than furnishing employees with free coffee and pastry every morning may not sit well with the rank and file. Consequently, if the company’s real objective is to line the pockets of the CEO and her lieutenants, it’s doubtful you’ll find that disclosed as a priority in the company’s cultural statement. The greater the difference between the private intentions of management and the company’s “official” objectives, the greater the likelihood of increased employee doubt, suspicion, and an “us versus them” mentality, especially when the company promotes an employee-centered philosophy while the day-to-day reality still reflects business as usual.
6. An organization’s existing culture—regardless of the form it takes—can not be used as an imperative standard by which to make assumptions about the company’s future relationship with its employees. Even objectively-measured incentives are subject to change. A downturn in the market or the bottom line can transform the friendly, smiling recruiter who welcomed you with open arms into a snarling, flesh-eating ogre who’s knee-deep in carnage from previously terminated co-workers.
Use the concept of “culture” to your benefit, regardless of whether you’re a Loyalist or a User. Now that we know more about what culture is (and what it isn’t), we can talk about how to use the concept to your personal benefit.
First, if your company has created a formal statement of organizational culture, read every word of it. Become familiar with it to the point that you can discuss the general theme in detail. You may even want to memorize the main headings. Being able to quote the highlights is impressive, and it shows you’ve not only taken an interest in the operational values and expectations of the company, but you also genuinely care about incorporating them into your work activities—giant gold stars for those on their way up.
In addition, if you’re ever asked to provide feedback on your company’s culture, or find yourself discussing the subject with management, consider using the following talking points. They’ll get you remembered as someone who understands the delicate balance between manifesting culture in a tangible form and the difficulties in budgeting long-term benefits in a volatile, competitive marketplace:
· Avoid adopting a Me Too approach to meet the “standards and values” of other companies in the same industry. With all the attention and focus on culture, there’s a temptation to change, update, streamline, humanize, or otherwise transform a company’s culture to align with popular trends—to be one of the good guys. This kind of motivation often results in poster-worthy phases describing an ideal workplace, but not much more. Instituting cultural change is an inside job, not a knee-jerk response to outside pressures. If management is serious about enhancing their employee’s environment or improving the work experience, the process is no different from making any other kind of improvement or asset purchase. First, determine the cost (in dollars, time, and disruption to the existing environment and protocol), and the impact, if any, on other company programs. Then prioritize the benefits based on the cost of acquisition, the percentage of employees who would take advantage of them, and the calculated return on investment measured in objective terms (less sick days, employee retention, higher quality new hires, etc.).
· Employees should be made aware of their responsibility for the on-going expense of a benefit-rich work environment. By realizing that tangible benefits come with a cost that is directly affected by profitability, it’s easier to rationalize the need to produce additional, offsetting gains in productivity. As a result, workers are more likely to recognize and appreciate workplace advantages that are otherwise taken for granted.
· Keep it simple. A thirty-thousand-word dissertation on situational ethics and their application in the workplace is a throwback to someone’s Master’s thesis. If you need a multi-level table of contents, glossary, or a dictionary to understand it, it’s doubtful the principles and concepts will ever manifest themselves into day-to-day operations. The best implementations of culture are simply stated and easily demonstrated. That means specific and measurable methods of how culture will take practical shape and form.
· Keep it realistic. If it’s not transferable into recognizable demonstrations of “doing something better,” it’s just theory. Fantasized culture wastes time and creates doubt in the minds of employees. Be able to point to concrete evidence of your “culture” at work. Give it a real presence. Maybe it does manifest itself in covered parking and free coffee. If so, make sure the employees know about it. A philosophical treatise describing the ideals of “working together to build a better tomorrow” is bullshit, especially if it doesn’t result in something discernible in the everyday work lives of the employees. It may take the form of recognizing workers for their dedication, loyalty, and consistently meeting team and organizational goals, or it might mean scrubbing the names from the reserved parking places of upper management to remove the perception of narcissistic elitism. To be effective, culture MUST make lives better, easier, or provide something the employee can point to and say, “My company does this, or provides that, and I think it’s great.” Those are the kind of accolades that give culture presence and value.
· Build internal culture from external financial success. Every company wants the marketplace to think of them as the good guys—people who care about their customers and demonstrate it with value, excellent customer service, and ethical interaction with the environment and society in general. In short, people want to buy from companies that leave a positive footprint. The benefits are obvious: Retention of customers as measured in repeat business, attracting top talent from the job market, and retaining good employees because they enjoy being part of something they’re proud of. Work on this external component first and internal culture can evolve organically—because the financial success required to support it will be in place.
What do you say when asked for your opinion on culture? It might happen during a review, or over lunch with a visiting division head. The topic is usually introduced when an upper-level manager says something like, “The evolving cultural influences in the current business environment tells us we need to begin placing a definite emphasis on responding to the needs of the employee.”
If you’re expected to comment, I suggest using the paragraph below word for word. It’s the kind of rhetoric managers love to hear. In fact, it may be what they need to hear to recommend you for advancement. It says you understand the concept and the relationships between sales, expenses, and profit—the holy trinity of business.
“Organizational culture is an extension of economic feasibility. No company can provide what it cannot afford—at least not in the long run. And as our concept of culture expands to meet the needs of a changing workforce, we must find ways to create a realistic and manageable balance between cost, employee satisfaction, and the future financial growth of the company.”
Coming up next from Better Mondays:
Chapter Eight - Draw a Line Between Your Personal and Business Life (And Keep it Flexible)
Thanks for reading,
Roger Reid | Success Point 360
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Roger A. Reid, Ph.D. is a certified NLP trainer with degrees in engineering and business. Roger is the author of Better Mondays and Speak Up, and host of Success Point 360 Podcast, offering tips and strategies for achieving higher levels of career success and personal fulfillment in the real world.