Doubling down on your company’s values can help you make the right decisions during the good times and will do so again during times of uncertainty, says Amanda Ginzburg
Company culture – a set of norms and values widely shared and strongly held throughout an organisation – has long been the glue that binds a business together. In times of crisis, however, it is critical. In fact, it can be the ‘x factor’ that can make or break a company’s survival. As organisations and individuals worldwide respond to the COVID-19 pandemic, lockdown and working from home have for many become the norm. So how can a business be sure its corporate culture is up to the task, and what should it do to ensure it is strong enough to carry it through?
To answer this question, it is important to first understand what components make up a company’s culture. Company culture isn’t the values on the wall. Rather, it’s the set of actions that you put into practice and live every day within your community.
They come to life through four categories which together demonstrate culture: beliefs – the values, assumptions and operating principles a company’s management has designed; behaviours – leadership modelling, communication, rituals; systems – policies, technology, environment; and reinforcement – recognition, rewards, incentives, measurements.
The culture loop
Beliefs, behaviours, systems and reinforcement work in unison as part of a ‘culture loop’. If any one component is compromised – damaging the loop – these components will not work in harmony which risks one or more of the key values or elements that make up company culture being compromised.
One way to get under the skin of a company’s culture is to interrogate the behaviour of that company’s heroes – high performing, high profile successful individuals widely recognised (and, likely, rewarded) by their managers and or other colleagues – and anti-heroes (their opposites). For example, do they work late nights and weekends and are they rewarded for that?
A silent indicator of overall performance
Company culture is often a silent indicator of overall performance. Strong cultures lead to larger profits, happier employees and increased innovation while weak or broken culture can be the root cause of why a company is no longer competitive. According to one study, 85% of CEOs and CFOs believe unhealthy corporate culture leads to unethical behaviour while nine out of ten of those same CEOs and CFOs felt company value would be increased by improving company culture, and four in five ranked culture among the five most important factors driving their company’s valuation.
Amazon, for example, is renowned for its strong company culture built around innovation. Experimentation is prioritised, with every employee empowered to innovate. Failure, a natural counterpart to experimentation, is embraced. Employees are encouraged to move towards their passions and ideas with the beliefs, behaviours, systems and reinforcement structures at Amazon aligned to make them possible . All of this is modelled from the top down by Amazon founder, CEO and president Jeff Bezos, whose philosophy is described as ‘Day 1’ – Day 1 being any company’s hungry and ambitious start-up mode, before giving in to stasis (a state Bezos describes as ‘Day 2’).
REI Co-op, consistently one of Fortune’s top employers and committed to prioritizing stewardship of the outdoors, is another company renowned for their culture. The business invests 70% of its profits annually in the outdoor community, including 400 not-for-profits that create access to the outdoors for all – a commitment shared by all of its employees. According to REI’s annual employee survey, 96% of staff fully support its values and believe it has a great reputation for products and services. Its benefits structure, which include days off to play outside and an additional paid day off on Black Friday to spend time outdoors with family and friends, lead the retail industry.
In contrast, Boeing has been held up recently as an extreme example of the impact a broken culture can have. After multiple 737 crashes, reports highlight that their culture shifted to prioritise speed above all else which led to systems that encouraged employees to underreport safety violations and created internal fear, competition and mistrust. Meanwhile under its former founder and CEO, luggage-maker Away has been accused of having a culture of fear and intimidation in which employees were reluctant to schedule time off they were owed and felt so driven to make customers happy they would do so at the cost of their own wellbeing. And as shown by the Wells Fargo fake account scandal – when the bank was caught creating millions of fraudulent accounts on behalf of its clients without consent (the result of company culture, a subsequent investigation suggested) – a weak or broken company culture can have a massive negative impact on the performance of a company.
The lifeblood of company success
Culture is the lifeblood of company success. In times of crisis – such as now, an unprecedented period of change during which many companies have moved completely remote or have adjusted their most basic operations to continue to function – it is especially important. In fact, most employees are more likely to trust their employers over government as a credible source of information concerning the Covid-19 coronavirus, a survey by the 2020 Edelman Trust Barometer found. The role of culture will shift as we move through the phases of crisis management.
Phase 1 is all about survival – getting up and running as a virtual, remote and or working from home business – and when it comes to reassuring, encouraging and galvanising newly remote-working employees, a supportive, empathetic, and empowering company culture will have an important role to play. Phase 2 is about achieving some kind of a return to normal, and a company culture in which every colleague feels cared about and safe will support employees bringing their whole selves back to work.
Health-checking your company culture now is therefore an important investment. And to do this, those four pillars that demonstrate culture – beliefs, behaviors, systems and reinforcements – provide an invaluable health checklist.
Ask yourself: how do your values, assumptions and operating principles hold up in current circumstances and, if there are any weak links, how best can you quickly address them? What new leadership behaviors can you model to support your employees? What new rituals can you put in place during the peak of the crisis to keep your usual culture intact? How should your communications shift? What new systems need to be put in place and what additional benefits could help your employees right now? What new forms of recognition and incentives could reinforce those values, and how should your corresponding measurement approach shift?
Doubling down on your company’s values can help you make the right decisions during the good times and will do so again during times of uncertainty.
Amanda Ginzburg is Head of Marketing at co: collective, a creative and strategic transformation consultancy.