Here’s how this conversation with a CEO usually goes:
“You’ve been successful,” I say. “What’s been making that happen?”
“Oh, for sure it’s our culture. We have a great work ethic. And we’re customer-focused. And … we’re very employee-oriented. We reward them quite well.”
That’s it? The CEO doesn’t really understand company culture. It overrides everything else.
“Culture eats strategy for breakfast,” is attributed to Peter Drucker.
One of my TEC members said, “The greatest thing I can leave behind is a unified culture that has aligned people flexible enough to adapt to changing strategic conditions.”
That’s what Jack Welch said when he took over General Electric, not knowing beans about such divisions as nuclear submarines, jet engines or financing. The first thing he did was establish GE’s Crotonville management campus, where every leader was indoctrinated into “The GE Way.” It included not pursuing any business in which the company couldn’t be first or second. That’s a strategic behavior.
So, what is culture?
Culture is the valued behaviors that best assure the organization can differentiate itself and be successful. TEC resource David Friedman says there are anywhere from 20 to 30 truly valued behaviors. They helped grow his New Jersey insurance brokerage from 20 employees to more than 100.
You can also call your valued behaviors “The ABC Company Way,” much like the West Point Way, which begins with behaviors that assure allegiance to its mission of “Duty, Honor, Country.”
When you articulate those 20 to 30 behaviors and they’re combined as “The ABC Company Way,” employees’ energy and commitment rise substantially, assuring higher performance.
The key is to describe values as behaviors, something that’s easy for employees to understand. “It’s what I must do.”
How do you determine the behaviors?
My TEC members have discovered effective ways to develop the culture list of behaviors. Think of it as a document you’re giving to a new employee: “This is what we do, and what you must do, if we are to differentiate ourselves and be successful.”
1. The lead-in.
Briefly describe your business – the product or service you provide and how you differentiate yourself.
2. What we do to differentiate ourselves and be successful.
These are three to five behaviors tied to your type of business. They’re different for different types of companies.
Often, one of the differentiators is to “be ‘bleeding’ edge regarding new information and research, so that we can be ‘cutting edge’ in what and how we deliver.” So you take time to understand the new literature in your field.
3. Who we are
These are core values, described as behaviors. Explain them as “what we do.” For example, if your company is responsive, you might say, “We get back to customers that day, even if we don’t have an answer, to let them know what we’re doing.” If the value is integrity, “We do what we commit to do.”
4. How we work with each other
Here you’ll have 10 to 15 behaviors that fall under the category of “What pisses you off.” It explains how people need to work together. This takes a few weeks of observation, but it will work. Examples:
Attitude – We will bring a positive attitude to work each day. “Bad days” infect others and their performance.
Vulnerability and Openness – It’s OK to fail, but let your team know what happened so everyone can learn from it.
Continuous Improvement – You must always be developing your skills and contribution. As an organization, we are committed to helping you do that. From Friedman: Practice blameless problem-solving. Rather than pointing fingers and dwelling on problems, identify lessons learned and use them to improve.
Then what?
When you’ve written your list, set it aside. Call a meeting of your senior people, and put the headlines for categories 2, 3 and 4 above on a flip chart. Ask your team to assign behaviors to a category or clarify them.
It gets harder. Now, you must present it to employees and make it work. Each boss must discuss each item with each person who reports to him or her and explain how each behavior is part of the employee’s job. When behavior is contrary to what’s expected, the boss explains what the employee must do to correct it.
Your employees have been yearning for this for a long time.
-Phil Hauck coordinates three TEC CEO groups in northeastern Wisconsin. He can be reached at phauck1@gmail.com.
