Evaluating Culture

By Garett Robertson

It is often said that culture trumps strategy in business.  Brilliant business models can be completely undermined by bad corporate culture as has been seen with recent turmoil at Uber.  Eventually bad culture catches up to the organization and creates rifts that are very difficult if not impossible to overcome.

So how does a company then create and maintain strong culture?  I often say to my clients if your people and culture are such an important piece of your success then what are you doing on a daily basis to encourage and promote culture?  Is it about having pool tables and juice bars in your office common areas or is it something else?

Ultimately, culture is about how your people interact with each other.  Google did not create the common lunchroom for all employees just to have a common lunchroom.  They did it with the intention of promoting interactions between people that normally do not interact.  For Google, this is a forum for open innovation and collaboration.

While lunchrooms and pool tables work great in companies like Google or other Silicon Valley startups that must encourage idea generation, it is also true that one size does not fit all and that other companies might derive their culture in other ways.  The ‘up-or-out’ hyper-competitive mentality of some law firms and investment banks is one point for their advantage for them that would almost assuredly fail in companies that rely on highly interconnected teams like those found in healthcare.  Culture can and should be built to create alignment between team members and business strategy.

In any case, identifying what works for your company and then building programs to encourage and support that culture is paramount to success.  This recent HBR article shares some tools that are helpful in this analysis.  The authors characterize culture across two axis, flexibility vs stability and independence vs interdependence.  

These scales can be used to evaluate cultural alignment as well as pinpoint exact points of conflict, or at least identify where problems may arise.

One of my clients is a successful contractor that I would characterize as having a very strong culture built on interdependence and flexibility.  Despite the already strong culture, they are going through a period of growth and transition that has been accompanied by the expected growth pains in a young business.

We conducted a survey with them to identify any points of cultural misalignment between the teams.  Despite almost complete alignment across the company of company’s culture and values, one department stood out in stark contrast.  While the company generally was very flexible with a high level of interdependence, this department was characterized as highly independent, competitive and inflexible.

After identifying the cultural divergences, I was able to work with the team to develop a tailored solution.  High levels of independence and inflexibility meant that this department would likely resist change and simply continue to work as they always have.  In the midst of strong growth, this department would need strong training and support to ensure new procedures and ways of communicating across the teams will stick.

Additionally, because this team is more independent, another risk area could be that their push to meet KPI’s and achieve bonuses could conflict with the greater needs of the company.  New KPI’s and incentive programs that align the interests of all the functional divisions in the company would be one way to mitigate this risk.

Whatever the unique case is in your company, we recognize that building a strong culture is critical to success.  It is very easy to lose sight of the people that make a company special.  More than most, we know that to be a strong leader, a business owner must always look for and find ways to build and promote culture.   

So what are you doing to establish and promote your culture?

About the author

Garett Robertson

Partner - North America

Garett is a two-time finalist for E&Y’s Entrepreneur of the year and seasoned executive with more than a decade of experience as CEO and CFO. He has led client engagements for executives and VC’s across the healthcare, telecoms, machine learning and general contracting industries in the USA, Spain, Australia, Peru and Mexico.

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