Notes On Culture
Experts have written far more and far better about establishing and maintaining a company culture than I could. As a senior leader in a large nonprofit for more than a decade, I did gain some useful insights that are practical and helpful in avoiding pitfalls. To work through it, I find it helpful to say what I would avoid in creating a company culture first, and then I close with a few guidelines.
Past Or Future
Someone wrote that company culture is the codification of the same decision made repeatedly that worked to the benefit of the company. (I do not recall where I read this, so if it rings a bell please let me know in the comments so I can give proper attribution.) In other words, often at a company’s beginning, the leaders will make a decision using the information and resources available that is grounded in the specific circumstances they faced. If that decision turns out to be advantageous, then they remember that episode next time and make the same decision again. Eventually, this becomes “the right way of doing things” and a pillar of company culture.
The problem I have with this definition of company culture is probably obvious: circumstances, external and internal, can be wholly different decades in the future. A culture that is rooted in past decisions, no matter how successful they once were, might lead to adverse outcomes as situations change.
For example, a non-governmental organization (NGO) in the social sector I am familiar with had frugality and an orientation to never spend money as an important part of its culture. This ethos was formed in the early days of the NGO, when it faced bankruptcy. The founders had to take out bank loans to remain solvent, and they went weeks or even months without pay. As income began to flow, their frugality enabled them to save high percentages of their revenue, which they reinvested. The NGO grew into new sectors and new locations, and added countless new staff. They kept making the same decision to save money and not to spend it except on the most essential items, and it worked. Eventually, it became a cultural artifact and no one questioned it.
Decades later, the NGO has a rainy day fund many times its annual budget and runs an annual surplus like clockwork. The cultural prohibition against spending money remains strong, regardless of the now-changed circumstances, and it prevents this NGO from flourishing beyond where it has been running for almost twenty years. Hiring a pollster to measure brand equity and brand identification, for example, is a common tool used by NGOs of a comparable size. However, this NGO refuses to spend money on polling -- “we never used to spend money on things like that!” -- even though it would reduce the annual surplus of the NGO by 1%. The NGO could afford the polling easily, and the polling would be highly beneficial. The only reason the NGO does not do it is because of the codification of past decisions into cultural rules.
It is inarguable that it is useful to learn from the past. Culture has a unique power, though, in that it is accepted as “the way we do things” without challenge. That is the danger: if the way we do things cannot be challenged, and it is rooted in past circumstances, then it becomes a barrier in the future rather than a valuable guide.
Promotion Or Prohibition
Culture can also be described as the unwritten rules that govern behavior and tell us what is proper and what is forbidden. Many company cultural values masquerade as promotions of specific behaviors, when they are really prohibitions. Culture can then stifle new ways of thinking and it can inhibit many of the processes needed for change.
For example, I am familiar with one NGO’s culture that extols teamwork and solidarity. One of the specific behaviors that is promoted in service to its culture is the value of going along with leadership’s decisions. It is presented as unity in purpose -- once a decision is made, the culture promotes getting behind it and making it happen.
But this cultural value also acts as a prohibition against speaking up with questions or criticism. As a result, I witnessed how leadership’s decisions were rarely questioned. The voicing of opposing points of view was treated like protest displays that undermined the cultural norm of teamwork. The result was that leadership made choices and the staff implemented them without question, and the NGO suffered from subpar strategic decision-making.
The point I keep in mind is that valuing some behaviors may inadvertently end up acting as a prohibition against others. Teamwork is great, and most people would say that valuing teamwork would not by itself preclude criticism. It requires effort to have both, though, because prohibitions against useful behaviors are far more harmful than the benefits of promoting others.
Culture Is Not An Operating System
A computer operating system at the core is an ecosystem within which all programs and applications are guaranteed to function, and where users have an interface for using them. Many companies desire to have their practices and procedures work as smoothly as an operating system. This could mean having a special vocabulary for talking about the company’s work. New hires would be onboarded and taught the vocabulary to facilitate communication internally. It might also look like the systematization of protocols for everything from requisitioning a purchase to how compensation increases happen.
None of this is culture. Having a common set of operating instructions and universally-understood vocabulary is valuable, but it is just a different thing from culture.
Culture Aligns With Mission
Turning to what culture should be, I find the most vibrant and beneficial company cultures to be seamlessly joined with the company’s mission, especially in the case of NGOs. Employees will embrace specific values and behaviors if they can see how doing so will help accomplish the social justice mission.
For example, an NGO might have a mission to advance the interests of young people in government decision-making. If this NGO is staffed by professionals who may or may not be young, then a cultural value of open mindedness and diverse view-seeking might follow. This cultural value would encourage soliciting the points of view of young people and cultivating a broad youth constituency, and it would be evident that the company culture is aimed at achieving the NGO’s mission. Employees will gladly center this cultural value in their work.
On the other hand, cultural norms that are disconnected from the NGO’s mission will be less followed. Worse, they create a cognitive dissonance. Employees will question why something would be elevated to a cultural pillar if it seems unrelated to the mission. Usually, employees will attribute it to the capriciousness of leadership or they will search for some other unflattering explanation.
Culture As Matching Algorithm
Culture could also be thought of as serving the function of a matching algorithm, like OkCupid for prospective employees. In this vein, culture helps to define the company’s spirit and what it’s like to work there. A jobseeker can see how well they match up with the company’s culture to determine if they will enjoy their daily activities, and most importantly if they will mesh with their potential future colleagues.
This reveals a common pitfall, as well. Often, company culture documents describe the culture using language that obscures the actual behavior the culture is intended to emphasize. For example, numerous NGOs will describe themselves as “goal-oriented.” But that is practically a tautology -- what NGO does not have goals that it tries to achieve?
Goal-oriented really might mean any number of things. For some NGOs, goal-oriented means that they will emphasize quantitative deliverables and management by numbers. Others use goal-oriented to mean that their evaluation systems and compensation-setting are dictated by numerical scoring and quarterly results.
Goal-oriented could mean any number of things, so it is worth being clear about how “goal-oriented” is applied within your NGO. How does it show up in the daily experience of your employees? Why might someone like or dislike this value? The clearer you can describe that, the more you will attract new employees who will thrive.