Corporate culture is driving force behind success

Why do some companies that seem to have a comparable level of talent as other firms have such different degrees of success?

And why does it seem that comparably qualified employees at some companies seem to have a lot more talent and get better results from their work?

The truth is that technical skills can only generate results to a certain level; it is the intangible influences in a corporate environment that are needed to go to the highest level of business performance.

The intangible influences come from a business's corporate culture.

Corporate culture -- whether it is written, spoken or generally understood in an organization -- will, over time, influence and eventually govern the way the company's owners, executives and employees think, feel and act in that business. It will play a significant role in the long-term success or failure of the company.

There are many definitions of culture, with the following being specifically related to a business environment: 

•  A blend of the values, beliefs, taboos, symbols, rituals and myths all companies develop over time, explicitly or implicitly, that are passed along by communication and imitation.
• Natural phenomenon that is created whenever a group of people come together to collaborate.
• Foundation for all decisions and actions within an organization.
• A collective programming of the mind that distinguishes the members of one group or category of people from another.
• Culture is symbolic communication, communication is culture.
• "The way things are done around here."

Visible corporate culture

Culture will be represented in both visible and intangible ways. Visible expressions of corporate culture are easy to observe: dress code, hours of work, job titles and perks, benefits available, identified training programs, organizational structure and consequent relationships, formal work environment, employee relaxation activities and family involvement.

Intangible aspects

However, the far more powerful aspects of corporate culture emanate from the intangible aspects of culture: beliefs, standards and values that relate to the business owner or CEO, undocumented rules, private conversations, moods and emotions of individuals, informal perks and benefits.

Also, nonstandard treatment of employees for unknown reasons, assumptions that evolve without specific documentation or communication, poor behaviors that are ignored, lack of feedback to employees, lack of needed information being shared down the ladder, inconsistent performance appraisal system.

Driver of productivity

Corporate culture not only has the potential to improve employee productivity in every organization, it should be considered a primary driver of productivity.

Companies that still incorporate the old Industrial Age command and control style cultures with the shadows of fear, mistrust and control are almost certainly at the bottom of financial performance in their competitive category.

Companies that have not openly communicated and engaged their workforce in the vision and future plans of the business will not have a workforce to take ownership of the organization's culture to maximize achievement of the company's performance goals.

Companies in today's world who do not have a culture that incorporates consideration of family and personal issues will incur high costs of employee turnover.

Importance of culture

It is surprising how many business owners and executives do not yet recognize the importance of culture for their long-term business success.

Business owners and executives need to step back and carry out a reality check of their business practices as they are today, no matter how painful this exercise may be.

This could include employee surveys, one-on-one interviews of employees at different levels within the company and with different levels of job performance ratings, conducting focus groups of employees with different functional skills to determine values that inspire and guide employee decision making, and interviews of high performance employees who have left, or retired, from the company to track historical changes in the company's culture.

The results from this analysis should be a picture of the company's strengths and weaknesses related to employee productivity, an assessment of the impact of the leadership team and executives on employee productivity.

It should provide the basis to develop a plan for culture changes and initiatives to impact the business going forward.

The planned outcomes should be a clarification of expectations for company-wide behavior, an increased employee commitment to what the company stands for, improved motivation, morale and teamwork, and a workforce more capable of making the best decisions in the company's interest.

Identifying and understanding the power of corporate culture for a company's long-term business success is the responsibility of every business owner and CEO.

A process of continuous awareness of both the visible and intangible aspects of corporate culture must be one of the most important accountabilities of any business leader. However, just communicating the elements of corporate culture is insufficient.

Employees need to be able to translate the company's culture into effective day-to-day decisions and behaviors for the benefit of the company's business success.

Iain Macfarlane is the president and founder of BizCOACHING & Associates in Madison, a franchise of ActionCOACH Business Coaching. He was named "Coach of the Year 2005."