Cultures are easy to define but difficult to follow. Culture, in traditional terms, is defined as a "way of life" or a set of consistent behaviors exhibited by a group. An organization's culture evolves with growing size, changing priorities, and sometimes changing leadership. Such changes can have a profound impact on an organization's growth. It can send it skyrocketing as much as it can send it down. So, how do we measure good and bad cultures? How do we associate performance and culture and derive if the culture is aiding growth?
Culture is not a single word, but a combination of 4 different datasets: Core Values, behaviors exhibiting those core values, KPIs measuring the impact of those values, and the fourth, the changing dynamics with scale. The real definition of culture lies in defining all four of these parameters.
Core Values:
Core Values precede everything else, forming the "WHY" of the culture. Cultures are a reflection of an organization's core values. What is your organization's core value or values? Can you explain that in one sentence? How is core value different from a company's vision & mission statement?
A vision statement is where the company wants to be.
A mission statement is what the company wants to do.
A core value summarizes why the company wants to be on that mission and achieve that vision.
Let us take, for example, a company provides consumers with On-demand meal delivery services, from farm to table. The company's vision is to provide healthy, chemical-free, organic, unprocessed food for families globally and reduce the risk arising from cancer or other life-threatening diseases.
The company's mission is to make it easy for families to purchase verified, unprocessed food with healthy ingredients by using the necessary technologies and logistics to procure from farmers.
The company's core value is zero-tolerance toward processed food with artificial ingredients and serving humans with only the best natural ingredients.
Some examples of Core values culture for the food company could be:
Delivering Happiness
Restoring good health.
Customers like family
Human first
Whatever it takes to do good.
And so on.
The choice of a core value determines the rest of the other three parameters.
2. Behaviors
What behaviors will reflect these core values?
How will the organization demonstrate its core values to the external world? The behaviors OR house rules are an essential aspect of culture. The entire function should behave alike and consistently in response to situations.
This consistency does not happen on its own. The organization must drive these behaviors through:
a) The hiring process
Once a core value is in place, and behaviors are define, the next most critical element in the hiring process. When hiring goes right, the culture moves in the right direction.
The hiring process is one of the most critical contributors to cultural alignment. Successful companies, such as Netflix, Amazon, and Google, have a painful and prolonged hiring process. Of all other criteria for evaluation, the cultural fit must be a crucial element to factor.
How do you assess personality types and fit? While some companies have the candidates take personality tests, it is also possible to evaluate the candidate through planned interview scenarios and questions by seasoned interviewers and a thorough referral check.
One of the traditional ways companies indirectly set the stage for culture is their onboarding activities and accomplishments in the first 1-2 weeks.
For example, in Robin.io, On Day one of joining, everyone must try the product hands on.
By end of his/her first day, the new joiner would have tried the product hands-on and reported to the entire C-suite, what was working, what was not working, and some of the good/bad/ugly about the product. On Day one. That sets the tone for multiple things - hands-on the product, productivity from Day one, self-learning, and transparency. All four of which are extremely important for a startup.
There are subtle and firm ways to establish cultural reasons. Come up with one of yours.
b) Training - New joiner and behavioral
The next most crucial step in establishing cultures is training. ONE training that an organization cannot leave for a third-party company to provide is this. An organization must come up with its own.
This is not a responsibility outsourced to HR. This is the responsibility of the C-suite which is operated by HR. Third-party consulting can help, but the buck stops with the organization. This training is crucial for all customer-facing employees because they are at the forefront of representing an organization.
Customer support, Customer Success, and account management teams must have a behavioral playbook(powerpoint deck at the minimum). The playbook must include how to respond, languages to avoid, de-escalate, handle an angry customer, and many situational responses.
One of the differentiating things that good organizations do that is very different from the rest is that the people on the field have the power to take decisions and implement them. They cut bureaucracy, which helps the field team act on their feet during critical times.
The B2C business is full of stories about how some entry level front line service personnel made huge spends (such as traveling by flight to hand over a misplaced item) or taking back really damaged returns etc.
And not all training is done in classrooms. How the leadership behaves is excellent training and learning for all. Reinstate the core values and behaviors every single day in team huddles. It takes repeated reinforcement. And when employees are caught not following the cultural values, provide constructive feedback and observe for openness to change. Anyone that is not open to your artistic vision will not be a good investment in the long term.
Train, empower, educate and iterate.
3. KPI
What key metrics are tied to cultural alignment? Is there such a thing as a KPI that relates to the effectiveness of your core values? The most significant reflection of your culture exhibiting your core value is customer's TRUST.
The very idea of living that value is to ensure that your customers trust your deals and products and remain loyal to purchasing from your company.
The best indicators of success are:
Unsolicited positive feedback - Putting out there for the rest of the world
A business that comes through referrals
A cheerful workforce where everyone feels safe and aligned
Continuous Customer satisfaction
Growth of new customers
When an organization's culture is not correct, the first indications come in the form of eroding customers. There could be a hundred reasons customers churn, but any churn coming out from human behavior is out there as direct as indirect feedback.
This is why collecting continuous feedback with ears on the ground is critical.
Institutionalize a non-business, customer-centric feedback gathering approach that reflects your people and their services, support, and communication styles. Keep products and pricing, and other business parameters separate. Focus on the human aspect and collect feedback separately in quarterly, half-yearly, and annual reviews.
Ensure that the middle and senior management is available for direct feedback from any customers' rank regarding the culture. There are way too many CEOs that are open to connecting on LinkedIn and sharing their email IDs, where they openly solicit feedback. This is a way for your customers to open up about your customer service organization.
4. `SCALE
The fourth parameter that plays a critical role in cultural alignment is scale.
As organizations grow and evolve, cultural alignment and behaviors can dilate. It can become impossible to control the individual culture groups of the organization follow.
How do you set up an organization for scaling culturally? Is this even possible? Most organizations set themselves up for scale by introducing automation, processes, and some level of supervision by adding more layers of management in a typical response.
While this might be a good approach, unless there are specialized processes and automation for "culture," it will get lost in the masses. Focus on cultural training, process, and feedback as a separate line item from all other business priorities. An Organization cannot scale and repeat its cultural behavior at scale without the following in place:-
Frameworks that communicate what the culture map/landscape looks like. This is not vague verbal English but a systemic framework that organizations can adopt.
Playbooks and recurring training with increased frequency focussed on behavioral expectations
Regular assessment and compliance tests
Daily huddles (like scrum meetings) with the leader reinstating key behavioral expectations
Empowerment of employees to act without approvals in specific scenarios.
The hallmark of success is the impact a business creates. And a company makes an impact through its products, services, and people. Culture works backward, starting from people, spreading to its services, and finally creating a hit with its products.