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5 Reasons to make culture a priority

By David Friedman, Founder/CEO

Everywhere you look these days – from the business journals to the sports magazines – people are writing and talking about culture. Organizations of every type have realized the powerful role that culture plays in success, and rather than relegating it to an HR initiative, the best ones have made it a key strategic priority. In my observation, there are 5 key drivers for this shift in prioritization, and one or more of these apply to virtually every one of us.

To stand out and win business

Most of us exist in pretty commoditized industries, where it’s difficult for our prospects and customers to distinguish what makes us different. Whatever we claim makes us so unique is often the same thing our competitors say about themselves. And when we all look the same, customers choose based on price, which simply reduces margins.

To combat this commoditization, we try to create new and innovative products and services. The problem is that this usually only creates a short-term window of opportunity in which we’re different. Before long, our competitors will copy our product or service and then we’re all back to the same spot. To make matters worse, copying us will typically take them a fracture of the time, effort, and money it took for us to create that differentiation! To be sure, I’m not suggesting that we shouldn’t be innovative. It’s just that this rarely creates a sustainable edge. And unless we’re Apple, thinking that we’re going to constantly reinvent ourselves is probably unrealistic.

However, if we could somehow get our people to be better than our competitors’ people – in how they work with customers, with each other, and even with vendors – not only would that be a huge competitive advantage, but it would be the most sustainable advantage we could create. Of course, doing it is primarily a function of the culture we build. And even when our competitors know that’s our formula for success, it’s extraordinarily difficult to copy.

To find and keep A-level talent

As I travel around the country, I constantly hear CEOs talk about the challenge they face in finding top talent, and keeping those people once they’ve hired them. We have relatively low unemployment and finding the very best workers isn’t easy.

Every research study you read about what attracts the best people affirms that culture is at or near the top of the list, even more than money. And this is even more the case for the younger generation that’s now entering the workforce. They want to feel connected, to feel a sense of purpose in their work, to feel that they work in a place that aligns with their own personal values. Culture is your strongest weapon in the battle for talent in the new economy.

To execute at higher levels

We all know that the culture in any organization has an enormous influence over how people do what they do. Put simply, our environment influences our behavior. Put the same team member in two different environments, and he/she will perform differently. A high-performing environment will cause people to raise their level of play to match what’s expected and what they see happening around them. And the opposite is equally true.

Within each of us is the capacity to do more than just average work. We sometimes call this “discretionary effort.” It’s the gap between what we might normally do and the very best we have to give. When people feel a sense of purpose, and they’re aligned with the culture, they’ll perform at a higher level. Imagine the power of unleashing the full extent of that extra effort across your entire organization!

To protect the existing strong culture

When organizations are small, they can often “get away with” not being so intentional or systematic about building a high-performing culture. The leader usually sets the example, and everyone else picks up on the cues and follows suit. But when the company grows, and begins to add more people, proximity to the leader is no longer enough to carry the day. There are simply too many people, or even too many locations, for the leader’s example to be seen or felt by that many people; and suddenly, that wonderful culture we had established has gotten diluted or lost.

This becomes even more challenging when making acquisitions and trying to incorporate entirely new groups into the existing culture. The more systematic we are about codifying, teaching, and practicing our culture, the more successfully we can “hardwire” it into the very DNA of the organization. This is essential if we’re to protect the culture we want in the midst of periods of high growth.

To preserve the founder’s legacy

Many of the organizations we work with are multi-generational family businesses. Often the founder was one of those leaders who set a great example and didn’t think much about “culture.” But as the business gets ready to be passed to the next generation, how do we make sure we don’t lose that spirit, that vision, that way of life the founder practiced every day?

To be sure, this challenge isn’t unique to family businesses. At some point, every business gets passed from one leader and leadership team to another. If we want to preserve the legacy of that founder, we need to be able to codify what he/she stood for, and then bake it into our culture in an intentional and systematic way.

As you read this, think about your organization. Which of these 5 drivers apply to you? Where does working on your culture fit into your strategic plan? What are you doing to make sure your culture serves as the foundation for your success for years to come?

If you’d like to learn more about how to do that, just shoot us an email, give us a call, or check out my latest book, Culture by Design. You might also consider joining other leaders who are passionate about their culture at our Annual Summit. We’re here to help.

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