Is there a positive correlation between good company culture and actual cold hard cash? Payola? Profit?
I get that question often in my work at CharlesBank Consulting. It would be so nice to be able to sit down and calculate an ROI on, say, increasing transparency among your staff. But I’ve often had to rely on anecdotal evidence in my answers, and large-scale studies circa 2000. In the absence of fresh data, building an empowering culture just seems like one of those obvious good things that eventually leads to improved performance and a better bottom line – something we have to assume without a bright set of numbers.
Happily, a six-year study out this week demonstrates an affirmative answer to that question.
The Relationship Between Corporate Culture and Performance [Wall Street Journal]
It’s not exactly an ROI culture calculator, but the sales machinations of dozens of auto dealerships were assessed against markers such as felt mission and sense of purpose among employees, and those with high culture scores ended up with high performance, too.
"Something Happened That Made the Culture Go Wrong"
Google spent a year learning that great teams have these common factors:
1.) Equal talking: "As long as everyone got a chance to talk, the team did well...But if only one person or a small group spoke all the time, the collective intelligence dwindled."
2.) Equally high social sensitivity: team members were all very good at being able to read things like body language and expression, easily measured with the Reading the Eyes in the Mind test, or countless hours together.
1 + 2 = 3.) Ultimately, these two elements help create psychological safety.
Bottom line: If you want innovation, make sure employees feel comfortable airing and resolving issues, making mistakes, and trying out approaches and ideas without being judged.
The Times today published a set of NINE, count 'em, nine, in-depth articles that present analysis and findings on work today. It is so rich with information that I recommend buying the Sunday print edition and setting aside about twelve hours to read it.
In addition to teams, they cover meetings, post-cube office environments, the case for blind hiring, lunch, and more.
Holacracy gets an overview in the meetings article, as does the Managers vs. Makers theory; the office environment article questions whether napping lofts help anyone. But the common element in every article seems to be that people need the permission to be themselves at work.
From the powerful article on the work-life equation:
"For years, an image of professionalism was closely tied, perhaps especially for women, to a strict respect for boundaries -- to the presentation of the self, at the office, as someone wholly unencumbered by the messiness of home life."
That is precisely what must change, they state (and restate) in multiple contexts.
The Work Issue: Re-imagining the Office [NYTimes]
Fully Formed Adults Don’t Whine
Netflix’s legendary HR strategist Patty McCord reports back on the hard line she drew with fussy employees. “I had had it with the baby attitude. No, you don’t get to whine about your T-shirt, you’re 40 years old.”
Netflix’s culture revolves around the idea of attracting only “Fully Formed Adults.” Doesn’t that sound great? That’s why they don’t need to track vacation days, or have performance evaluations, and that’s why they fire freely, too. They assume adults can handle it.
The Woman Who Created the Netflix Culture [Fast Company]
As McCord herself eventually got fired. [Fast Company]
Fairness + Safety + Control = :)
The Times' Adam Grant reminds jobseekers of the importance of digging up the dirt on culture, and he says it comes down to 3 factors expressed across 4 basic questions.
Do the questions he recommends resonate for you, in your organization?
1. Is the Big Boss Human?
2. Can the Little Person Rise to the Top?
3. Will I Get Fired?*
4. How Will the Boss React to Mistakes?
The answers to these questions will lead the candidate to big reveals about fairness, safety and control, which are ultimately the key factors in lasting satisfaction at work.
Ask About Culture and Only Culture in Your Job Interview [New York Times]
*(I actually asked this one during an interview once. It led to a fruitful conversation and a job offer.)
Edgar Schein, famed cultural theorist formerly of MIT (but now of Palo Alto, as he recently told me over email) laid out the original structure of company culture in three layers:
1.) Artifacts: The things in an environment that you can feel, touch, taste, smell, and hear (such as people laughing, or not; natural light, or lack of it; etcetera).
2.) Espoused Values: The things you say about what your organization stands for – values, goals and approach.
3.) Underlying Assumptions: The things everyone actually believes about what the organization stands for and how it functions – and these fluctuate all the time.
We want alignment between these three elements. When the alignment is off, there is an organizational disconnect.
So how do you find out if they align? Simple: Ask!
What do you do if there is a disconnect? Not so simple, but it starts with intentionally uncovering, and then taking a hard look at, the real problem (this brings to mind the poem One Train May Hide Another, by Kenneth Koch).
And remember, every place has a culture, whether it’s intentional or organic – even if it’s two people and a bare light bulb.
Consulting services on offer: Business Development, Coaching, Retreats and Facilitation, Competency Mapping, The Right Physical Environment, Misson/Vision Development, Leadership Circle Profile Assessment, and more strategic people practices for an innovation culture: http://charlesbankconsulting.com
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May your culture shine bright,