The 2 Components You Need to Make Culture

PeopleStrategy

Strong culture drives success

Culture is a term that is readily used in business, more and more evidence is appearing to suggest that companies with a great culture are more successful than those that don’t. There are 2 essential components that are required to make a culture. When we ask clients what they think culture is and what makes a great culture, not one of them is able to give us a definitive answer, so if they don’t know what it is, how could they know whether there culture is healthy let alone being lived by everyone within the company?

The Collins English Dictionary defines culture as:

  1. The total of the inherited ideas, beliefs, values, and knowledge, which constitute the shared bases of social action
  2. The total range of activities and ideas of a group of people with shared traditions, which are transmitted and reinforced by members of the group: the Mayan culture
  3. a particular civilization at a particular period.

We view culture as a group of people pulled together to achieve a common purpose with the same inherant beliefs.

What does a business owner or leadership team need to get clarity on to bring alive a healthy culture in any company? In our mind you need clarity around two components; The Hedgehog Concept and your Core Values. To find out more about what these are click on their links, we want to go look into the power of these when they are combined.

The hedgehog concept allows a business owner or management team to get clarity around why the business exists, what purpose does it serve in the market place and how it will sustain itself in the longer term financially whilst the core values are our inherent believes, it is the 2-3 rules that dictate how me behave in the pusuit of our purpose. When a business owner or management team have absolute clarity around those two areas it makes it very easy to make key decisions in the business for example.

Strategic Thinking

Strategic thinking is all about how do we grow our top line, our sales in the mid to long term. When leadership teams put their heads together to come up with the next big idea, whether that entails new products, better ways of selling existing products or pivoting completely in a different direction. The one question I always ask my clients is “how does that fit with your hedgehog?” If it still aligns with the purpose of the business, feeds the economic engine and moves us towards our BHAG then it is a potential opportunity, if it doesn’t it is likely to be a major distraction and maybe a re-think of the plan is required.

Hiring The Right People

When reaching out to the market place or your virtual bench to find your next A player, have a clear understanding of what your culture is essential. All the advice now is to hire for fit first then skills, experience and qualifications second, no matter what the position within your company. Fit is more about ensuring that every employee and all potential employees fit with the core values of the business and they can connect and are excited about the purpose of the business. Remember for every employee that is not aligned at the values and purpose level of the business you have a dilution problem, if you have enough employees not aligned you will have a weak culture or worse you may have accidental values working against your business.

Finding the Right Clients & Suppliers

You want everyone that your company comes in contact with get excited about your purpose and aligned with your values, whether they are employees, suppliers or clients. In our experience when I business has troublesome clients and suppliers that hinder the businesses progress they are almost always not aligned with the values of the business. These people or organisations only cause large amounts of stress to everyone who has to deal with them and in some extreme examples if they are clients they also don’t pay on time or find ways not to pay at all. Just like you should do with employees if they don’t fit, we free up their career options (move them on) we should be taking the same tack with our suppliers and clients. As hard as that sounds, those who have done it inevitably say “wish we had done that months ago”.

If you haven’t already you owe it to your business to get clarity around your culture.