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How to create a company culture that works

There's a lot of talk about workplace culture these days.But what exactly is it, how do you create a ...

Posted: Dec 10, 2018 3:57 PM
Updated: Dec 10, 2018 3:57 PM

There's a lot of talk about workplace culture these days.

But what exactly is it, how do you create a good one and how do you make it last?

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A culture is a belief system that every employee must buy into or else a company may risk creating a toothless value system that no one follows, explained Chuck Blakeman, founder of Crankset Group, which helps companies build strong cultures.

The values and principles of a company should dictate how all employees treat each other; emphasize openness, transparency and inclusiveness; encourage innovation and risk taking and detail the purpose of the company.

But printing out a mission statement isn't enough. It takes a lot of work and follow-through to create and sustain a good company culture. A company can have a 50-page manual that explicitly details its mission and values, and still be a terrible place to work.

Offering a surplus of fun perks and benefits, like free food and rping pong, won't do the trick either.

"If there is a culture where people are being discounted and dismiss each other, all the snacks will do is feed them, it won't change the relationships and the way people treat each other," said Chris Edmonds, author of "The Culture Engine," who also advises companies on culture.

Establishing values

The first thing all businesses should have is a set of values that dictate not just how the company operates in society, but also how its employees treat each other.

Blakeman says a company's core values should be a "guiding light and true north every day."

At his own company, its five values, vision and mission are recited at meetings, and participants giving examples of how they've seen one of them played out either at work, in a book or movie, or in real life.

Creating a culture that lasts

But even when a company establishes a good culture, it takes work to keep it going and it can get derailed as the company grows, gets acquired or shifts its business plan.

When bookkeeping company Bench first launched, CEO Ian Crosby said it had a great culture with its values and mission detailed in a handbook. "We had lots of lofty ideas and it was amazing," said Crosby. But when the company expanded, the culture derailed.

As Bench grew and it brought on new managers, its culture didn't scale with it. Employees were working long hours, but missing their goals. People weren't sharing information and there was an apprehensiveness to take risks.

"It didn't last," Crosby said. "The handbook was a lot of wishful thinking."

He said employees saw the principles as aspirational, and not as the company's cultural expectations. And while he said a handbook helps to establish a culture, he added it becomes meaningless if you don't follow the words you write down in it.

The company now has five principles that guide how it functions and how employees treat each other. Crosby informed his managers that these principles are the new norm. The principles are reinforced in town halls and meetings, and semiannual happiness surveys are given to provide insight into how employees are feeling about the culture.

Not all his managers got on board with the new principles, and Crosby parted ways with a few executives and leaders. "They didn't want to get with the program and didn't think we should operate this way. They aren't good or bad, they just didn't want to play the game."

Righting the ship

It can take some time before a company realizes it has a culture problem. Usually a business suffers an "organization heart attack" before Edmonds gets called in to help.

"Culture is about workplace relationships, not necessarily workplace performance," he said. "Senior leaders have never been trained to even look at the quality of workplace relationships."

Kyle Porter, CEO and cofounder of SalesLoft, says he ran the company into the ground.

"I burned all my investors' money and had to rebuild from scratch," he said. He blames the near extinction on his lack of certain leadership skills and not putting values at the center of his business.

So he read more than 100 books on leadership and running a company, and created five core values that were going to drive the company. These values are ingrained into the company's workers and also instilled during the hiring process.

Every interviewee goes through a cultural check, with a two-person team trained to ask questions to determine if a candidate aligns with the core values. It's common for a candidate to meet with several employees during the interview process. Porter recently hired a chief marketing officer who met with 20 employees before getting hired.

Design, align, refine

When working with companies, Edmonds uses a three-part process to create a good culture: design, align and refine.

The first step, he said, is to define the values the company wants to stand for in observable, tangible and measurable behaviors.

But that's the easy part. Align is the toughest and longest step of the plan, and can take 12 to 18 months. This part requires managers to both practice the behaviors themselves and coach their direct reports to adopt them as well.

"You can announce whatever you want, aligning them and having consequences — that is hard," he said. Companies should survey their employees regularly to evaluate the implementation among the leaderships and peers.

The refine stage should occur every couple of years or when major events happen, like a merger or acquisition.

"If you assume people are going to be nice to each other, you are going to be desperately disappointed," said Edmonds.

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