The Conundrum of Culture

As we read any business publication, watch TEDTALKS or listen to podcasts, it’s crystal clear the topic of company culture has moved to front and center in the past few years.

Since 2010, culture has become the most discussed talent issue, having risen topically by 12% annually in earnings calls (Gartner, 2017). Organizations are increasingly becoming acutely aware their reputation and brand often hinge on culture. David Cummings, Co-Founder of Pardo claims, “Corporate culture is the only sustainable competitive advantage that’s completely within the control of the entrepreneur.”

In a recent client strategy meeting, the financial gaps between current and future EBITDA were exposed relative to the desired growth curve. A portion of the day was allocated to discussing potential revenue streams to bridge the gap and feed the continued growth aspirations. It was energizing and opportunistic to see several viable ideas poured out with such passion.

While companies must obviously keep their eyes on the prize of financials, we can argue that culture – while it may not ever become the leading star of the show – is going to increasingly steal a great deal of the spotlight.

Simply put, culture is about how we show up at work and how we get stuff accomplished. Or in the words of Brian Chesky, Founder of Airbnb, “Culture is simply a way of doing something with a passion.”

Company Culture Gap Analysis

So, what’s the conundrum with culture? Unlike financial gap analysis, organizations may overlook addressing cultural gap analysis. We can’t just “choose” culture. However, we can work to get team members to demonstrate the behaviors that epitomize the desired culture. In a 2017 study by Brooks and Knight, they looked behind the culture curtain of 7500 companies. Their work revealed three states of behavior tied to culture. The findings give us strong clues about the gaps between each one:

1-     What we say – Leaders communicate the importance of culture – 83% of leaders do this consistently;

2-     What we do – Leaders’ behaviors are consistent with culture – 29% landed here; and,

3-     How we operate – Culture is tied it into all processes – budgets, staffing, structure, policies – only 19% of employees drive culture to the operational level.

The study urges companies to remove the translation barrier for their team and themselves to ease tension. For example, if we have a different schedule for summer work hours as part of the bigger push toward work/life balance, does that mean we should leave at 3:00 to go spend time with our families, or work on the one critical project we’re trying to finish? The Gates Foundation has their teams define a framework of dos and don’ts for each core value aligned with the vision of how their team operates, allowing them to perform within any unique aspects of structure while preserving the overarching values. It also serves as a decision-making mechanism for high stakes moments of tension that may test alignment of culture.

Many organizations unquestionably have an enviable culture. However, with growth and scalability, it will become more critical for the culture to be further defined and actualized. This will mean bridging gaps between what is said and day-to-day moments of executional truth. It can be an opportunity to follow the philosophy of Nike as stated by Mark Parker, CEO, “We have a culture where are incredibly self-critical, we don’t get comfortable with our success.”

This can be the start in solving any challenge – even the conundrum of culture.

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