WHY HAVE A CORPORATE CULTURE?

AND WHY DO WE NEED TO THINK ABOUT CULTURE IN OUR BUSINESS?

Surely, as long as we are providing our customers with the best products and services and they are happy then that’s as much as we need to do, right?

When speaking with business owners, I often hear things like “I can’t afford to put time into culture. I’m too busy running my business to waste my time with making everybody feel good.” Or “We’ve got challenging economic times ahead. I need to be focussing on cash flow, revenue and bottom line retained profit rather than group hugs and feelings.”

Do any of these those opinions sound familiar? They do to me. I’ve heard them all before and mostly from businesses that are in desperate need of assistance.

Fortunately, most small businesses don’t think like that. A recent straight talk survey conducted by the Bank of Queensland which canvassed the views of small business owners nationwide revealed that 88.8% of those that responded believed that small business culture was primarily responsible for a high degree of loyalty amongst employees of small businesses.

Here are some interesting results from that survey:

• 76.5% of small businesses are in a better financial positive than 12 months ago.
• 58% of employees like to be involved in culture development.
• 77% of employees consider flexible working conditions are desirable.
• Almost 80% think employees are likely to be more loyal than employees from large companies.
• 88.8% believe that this is due to small business culture.

WHO HAS ONE?

One of the most famous examples of the value of corporate culture in business has to be the Apple Corporation. Apple is a shining example of how culture can be understood on a symbolic level. The apple logo is one of the most recognised corporate symbols in the world. It is synonymous with innovation, cutting edge technology and fun. The co-founder of the corporation, Steve Jobs dropped out of college at the age of 21 and started Apple with his friend Steve Wozniak from his parents’ garage. He became a multimillionaire by the time he turned 25. In an interview on “60 minutes” in 2003, Steve explained the inspiration behind his business model. “My model for business is The Beatles: They were four guys that kept each other’s negative tendencies in check; they balanced each other. And the total was greater than the sum of the parts. Great things in business are not done by one person, they are done by a team of people.”

SO LET’S LOOK AT EXACTLY WHAT CULTURE IS…

Corporate culture is defined as the collective behaviour of humans who are part of a corporation and includes things like values, visions, norms, working language, systems, symbols, beliefs and habits. It is also the pattern of collective behaviours and assumptions which are taught to new team members as a way of perceiving, and even of thinking and feeling. Culture can be written either as a mission statement, it can be spoken or at times it can merely be understood. What culture does is, it describes and governs the way business owners and employees think, feel and act. Your own business culture may be based on beliefs spelled out in your mission or values statement. For those of you unfamiliar with those concepts here are some simple explanations. A mission statement is basically a statement of purpose. Essentially, it is your company’s reason for existence. A values statement can be often referred to as “guiding principles.” These let your customers and team members know where the company stands and what the company believes in.

TIME FOR CHANGE?

Whatever way you record it, your culture plays an important role in determining how well your business performs. The good news is that if you are not happy with your culture, there are a range of things you can do to start changing it. It may be a matter of looking for a symbol, a ritual or another tool that you can use to bring out the values and practises that you want for your business.

However, the important thing to remember is that true culture change comes from within and feeds from the top down. If you want to bring about true culture change in your business, then you, as the visionary are going to have to direct and lead that change and you’re also going to have to create an environment and a process which enables your staff to have a sense of belonging to that culture change as opposed to a mere statement or outward sign such as a logo.

VALUES DETERMINE CULTURE

When examining culture, the first thing we need to do is to determine the values or core principles of your business in relation to culture. Put simply, if we don’t understand what the business stands for then it becomes impossible to deliver according to that ethos.

When discussing values, business owners often provide answers like honesty, integrity, and truthfulness. These are great values but they can very easily become single word platitudes. That’s not to say that we shouldn’t encompass or incorporate these concepts as part of the development of the values in your business but what it does mean is that we need to make sure that those values carry real meaning. A meaning that can be applied in the business and that has a true significance not just for you but for all the people who work for you and with you.

This article gives you an opportunity to determine what the values are in your business. Remember, these values need to truly mean something to you because at the end of the day you are the one that is going to apply them on a daily basis. So, if you are going to say that one of your values is honesty, then you need to be able to explain exactly what you mean by that. Are you referring to honesty in your advertising, in marketing, in product description, in explanation of processes, in delays or all of the above? You can tell from just that simple example, that the word honesty can have quite far reaching ramifications and more importantly a number of different interpretations open to it.

Remember that if you are going to use a term like honesty then you need to be able to do the following:

• Understand it
• Explain it
• Detail it
• Apply it
• Teach it
• Sustain it
• Defend it
• Insist upon it

CULTURE & TEAM ETHOS

Developing the correct team ethos is another vital component in creating the success you need in your business. The trick to developing the correct ethos is reliant upon having a solid grasp of the most appropriate business strategies for your business. Developing a culture which seems ideal purely from a cultural perspective is not in the best interests of the business from a development perspective. It can be as damaging as not having the correct culture. In other words, an integrated approach will work best.

Culture won’t develop overnight and it needs to be part of a clear plan. It also doesn’t hurt to apply some science in this regard. The Pareto Principle applies equally in the development of culture as it does across many aspects of your business.

What is the Pareto Principle? Well, in 1906 Italian Economist Vilfredo Pareto created a mathematical formula to describe the unequal distribution of wealth in his county. He observed that 20% of the people owned 80% of the land. This applies in business to the extent that 20% of something is usually responsible for 80% of the results. Applied in your business this can mean that 20% of your team can create 80% of your problems. By developing an effective culture and training your team on effective processes, policies, interpersonal skills and culture development and implementation, you can make the Pareto Principle work in your favour.

The bottom line is, corporate culture is what we make it and defining our values, mission and ethos is the first step on the journey. As business owners if we don’t make the time to work on our corporate culture, we run the risk of having little or no input into it at all. A culture exists regardless. It’s in the way we act, the language we use and the way in which we operate. It is vital then to take a close look at what your culture says about your business and to re-examine why you are in business, what you stand for and what you believe in.