Editorial
Zappos CEO Tony Hsieh famously noted that, “To make customers happy, we have to make sure our employees are happy first.” That remark has proved to be prescient because in the last decade or so, many other companies have begun to realize that their long-term success is tightly linked to their leading corporate asset — their employees.
Still, change is hard. It takes time, and may start and stall when you least expect it. To succeed over the long haul, organizations much accept that their employees are indeed their number one asset, and that making sure their employees love their jobs is extremely important to success and the bottom line.
Netflix’s Pioneering Culture Code
Prior to the surge of interest in corporate work culture, the issue of prioritizing employee contentment wasn’t explored or appreciated as a company asset. Companies like Zappos, Starbucks and Netflix were ahead of the curve as role models for the evolution that organizations are currently undergoing.
The tide began to turn in the early 2000s when Reed Hastings, the CEO of then-nascent Netflix, publicly shared his vision for his company’s culture code in a massive 100+ slide presentation. Hastings’s deep dive into developing culture at Netflix has gone on to garner nearly 16 million views since then.
Culture Deserves Attention
While work culture existed before 2000, its study and development wasn’t considered important in meeting a company’s goals, which generally revolved around increasing revenues and keep shareholders happy. The connection between corporate culture, revenues and shareholder value wasn’t quite forged back then.
One thing that Netflix’s culture deck revealed was that corporate culture was finally getting the attention it deserved. Other major companies began to see that culture really was key to success, and even a competitive and strategic advantage.
Every Culture Is Unique
Products and features can be copied, but every culture is unique, and rightly so. Companies across the board, from healthcare to finance to the services industry, have crafted statements that reflect the cultures they’re working hard to maintain.
You can’t hire someone to create a culture for you because most corporate cultures develop organically. What’s more, if a company has more than 10 or so employees, the culture is already there. In cases like those, you just have to discover what it is and then cultivate and articulate it.
Since it would be difficult to be what you are not, or maintain that façade for any length of time, the emphasis should be on discovering what your culture is now. Taking stock of what’s happening on a regular basis is always a good way to reveal workday issues between employees and management. That way, a framework can be put in place to raise concerns and change unhealthy or dysfunctional habits, but if you like what’s already there, you can keep nourishing it.
Crafting a Culture Code
HubSpot co-founder and CTO Dharmesh Shah calls culture “a company’s operating system.” Netflix’s Hastings succinctly states that culture is “how a firm operates.”
The following highlights from HubSpot’s Culture Code provide a few examples of what might be included in a corporate culture statement:
- Culture is to recruiting as product is to marketing
- Whether you like it or not, you're going to have a culture. Why not make it one you love?
- Solve For the Customer — not just their happiness, but also their success
- Power is now gained by sharing knowledge, not hoarding it
- "Sunlight is the best disinfectant"
Culture Traits Versus Brand Traits
Articulating and creating a culture statement requires deep thought and contemplation about your company’s purpose, strategy and tactics. Culture aligns very closely with company promise. Although it’s tempting to include attributes like ‘fun work environment’ and ‘encourages work-life balance’ in the statement, please don’t.
That’s because a so-called fun culture is more of a brand trait, since brand is a set of promises of what customers can expect when doing business with your company. Brand should not be confused with culture, which is inward-facing and does affect outward audiences such as customers and partners.
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If ‘fun work environment’ is deemed a brand trait, the culture statement should support this brand attribute to deliver on its promise. One important reason for having a codified culture statement is to back up brand promises. If the two do not align, there could be trust issues that would affect inward as well as outward audiences.
One Big Happy Family?
One big mistake that some organizations make is to describe themselves as one big happy family. That’s a pretty loaded statement when you think about it. After all, how many families do you know that fit that description? Families can be quite complicated and sometimes very dysfunctional. That is probably not the way you want to describe your workforce.
The concept of teams has certainly evolved over the past decade. For one, a team isn’t perpetually the same. Teams change along with the company’s needs. Because change is a key team attribute, flexibility and being able to get along with many different types of people become highly valued traits.
Reward Team Performance
Team performance is judged by how well members execute according to the tenets laid out in the culture code. Mediocre teammates can be demoralizing and pull down the rest of the team. A fair analogy might be to think of one of the high school projects you were assigned to and remember what happened when some group members failed to pull their weight.
At many companies, those who do pull their weight and meet goals get moderate raises. Netflix rewards stellar team members with generous bonus packages.
What Makes an Effective Team?
So what constitutes a good or effective team? According to ManagementStudyGuide.com, an educational portal on management-related topics, some criteria include:
- A clear, elevating goal that has been communicated to all
- A results-driven structure, where goals have been jointly decided by all the team members and everyone is fully committed to achieving it
- Competent team members, where everyone has the required skillset to achieve the team objectives
- Unified commitment, where nothing happens in silos.
- A collaborative climate, where commitment from team members and good leadership leads to a collaborative team and a productive work environment
Linking Culture, Teams and Brands
There is a clear link between corporate culture, teams and the brand. This is one reason why it’s critical to codify your corporate culture. The culture statement provides a baseline for all teams to adhere to. It also should support your brand and what it represents.
A culture statement isn’t the same as the stodgy mission statements of decades past. It requires a long-term commitment to defining and supporting your corporate culture, which not only affects the efficiency and effectiveness of your teams but also company success.
What starts out as an exercise to define and cultivate corporate culture becomes an outward representation of your company and brand and can have a real and lasting impact on how successful your organization will be.
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