Company culture tips from the best small and large businesses

It is easy to fall into the trap of thinking about an organization’s “culture” as the surface-level stuff — foosball tables, cool looking office spaces, and free lunches. Basically, perks.

The best businesses large and small alike recognize that their culture is much more than the surface stuff and more than a cult of personality. They create outsized value over long periods of time, and they maximize performance by making sure that they are consistently a) focused on the right efforts and b) as productive as possible with their resources.

Company culture

A mission-driven culture that bakes in focus and productivity will keep winning. It’s an organization’s north star; it’s what Peter Drucker meant when he said that “Culture eats strategy for breakfast.”

A growing group of corporate leaders and researchers have begun to dig deeper into the specifics of how you actually create that type of culture in an organization. We at the Culturati Summit have polled a number of these leaders to get their thoughts on the most interesting developments in culture this year as well as what to look out for in 2016.

1. What are the most significant trends and/or insights regarding organizational culture?

Amy Edmondson: I was struck by a substantial increase in the celebration of flatter, more dynamic organizations. There were numerous articles and blogs on holacracy and other radically decentralized organizational structures – on how they work, how they challenge people, and ultimately why they have such promise for the creation of meaningful work and productive workplaces.

Alexis Gonzales-Black: People are trying to take Agile beyond the tech team. I’ve noticed a desire to create organizations that can adapt to emerging data on an ongoing basis.

Jeff Diana: Transparency and autonomy. Companies have started embracing the idea of an “open company” where information is shared openly and transparently across the company. Rather than keeping information restricted in silos, organizations are instead encouraging knowledge sharing by giving people open access to information and data. By enabling all team members to self-service their requests, people feel a stronger sense of independence and are able to leverage the work of the rest of the organization, ultimately making a company run more efficiently.

Patty McCord: In the startups I work with, I see flatter organizational structures and more rapid shifts in organizational structure as businesses move faster. Most work consists of cross functional collaborative teams rather than large departmental silos with hand-offs. Real-time data is allowing all functions to be more customer-centric.

Jeff Diana: Also, flexibility. Gone are the days of a nine-to-five workday. The rise in globally distributed workforces and a new wave of collaboration technologies has led to a work culture that is “always on” (thus the obsession with work-life balance among forward-thinking companies and managers), but in which people are no longer tied to their desks. By allowing work schedules to flex around family and other scheduling constraints, you can attract and retain a workforce with a greater variety of ages, cultures, and genders. The value of diversity and the perspectives it brings to company culture, products, and ultimately customers goes without saying.

2. What are the most interesting organizational culture trends to watch in 2016?

McCord: More realistic and generous parental leave policies. Gender equity and participation. Purpose and mission becoming as important as perks and parties.

Chris Fussell: I think it will be the increasing importance of building internal networks within organizations. Siloed, dispersed teams are just no longer up to the task of tackling complex challenges. Organizations that succeed will be the ones that tap into their internal networks, build relationships that cut across silos, and work to harness the minds and experiences of all of their employees, creating solutions that emerge from the bottom-up, instead of the top-down.

We have seen an emphasis on empowerment in the workplace. Organizations are recognizing the importance and value of pushing ownership and decision making to the lowest appropriate level. As a result of this, employees at all levels of an organization are motivated to perform to their highest ability and are consistently engaged in their work.

Diana: Horizontal or “flat” organizations are on the rise because they’re more inclusive and, most importantly, more efficient. Businesses that move in the direction of higher collaboration and more transparency will reap the rewards of greater speed, agility, honesty, and integrity.

A desire for social purpose is on the rise. People are looking for more than just a job and a paycheck; they want to feel passionately tied to the work they’re doing and feel supported by a company to pursue what matters most to them. More companies are starting to embrace this movement through initiatives like Pledge 1%, 20% time, and foundation leave (paid time off to do volunteer or non-profit work. Adopting better business practices like encouraging sustainability, increasing workplace diversity, and giving back to the community in turn makes a company stronger.

3. What is the most interesting company to watch in 2016 regarding the evolution and impact of their organizational culture?

McCord: The Zappos experiment, of course, but there are also many changes all over the world in ways we work.

Gonzales-Black: I will always be watching Zappos as they work to solidify the operating changes they have pioneered in the past few years, and I’ve also found the Buffer journey extremely interesting. They are exploring self-management, ‘teal,’ diversity initiatives, and other next-stage management practices and have been documenting them with radical transparency on their blog. What’s fascinating is that they aren’t just sharing the bets that paid off, they are sharing the challenges and failures as well.

4. What is the biggest organizational culture victory you’ve seen in 2015?

McCord: Broadly speaking (not company specific) the recognition of the lack of women in tech and the revisiting of diversity as an issue. Companies publishing race and sex data is huge. I see many organizations actually working on making corrections and being aware. Let’s hope it is followed by real changes and not just platitudes.

5. What is the biggest organizational culture “fail” you’ve seen?

McCord: Yahoo had the opportunity to focus and become leaner and more competitive, but it didn’t have the courage to go far enough. Just getting everybody back to work was only part of the solution. I don’t think it focused enough on having the right people.

Fussell: The world is becoming ever more complex, and 2015 was no exception. The ability of a non-state actor like ISIS to grow rapidly and force responses from major nation-states around the globe, the hybrid warfare executed by Russia’s incursion into Ukraine, and the economic implications of these types of 21st century problems all point to the fact that the leadership models of the 20th century are being quickly outpaced in a world dominated by fast-changing and interconnected networks.

6. What was your favorite book on organizational culture last year?

McCord: Work Rules by Laszlo Bock.

Fussell: (Aside from our book Team of Teams of course) I really enjoyed Simple Rules by Donald Sull and Kathy Eisenhardt. The authors make the very compelling argument that, as the world increases in complexity, we must fight our natural tendency to respond with ever-more complex systems – instead, looking to simplify our organizational structures and guiding principles wherever possible.

At McChrystal Group, we work regularly with large businesses creating what we call the “Keystone Forum” – a large-scale meeting designed to create regular communication between cross-functional stakeholders. The Keystone Forum is designed to create genuine alignment on strategy so that execution authority can be decentralized between sessions. In a world where large organizations must move faster, this is proving to be a highly productive tool.

Gonzales-Black: I have to say Reinventing Organizations by Frederic LaLoux. It was a difficult read at first, but once I started using it as a reference tool for common questions and challenges organizations were facing, it became a staple for me.

7. What was your favorite article, podcast, or video about organizational culture in 2015?

McCord: My own with Stephen Henn from Planet Money.

Fussell: I’d recommend this piece in the New York Times titled “Rethinking Work“.

Gonzales-Black: I listened to the “manager tools” podcast where they give straightforward advice to managers on concrete topics like performance reviews, counseling someone out of a job, etc. Since my job is to help people become their own managers, I would take the advice and figure out how to help people build these skills at all levels.

8. What is your favorite tool for facilitating a productive workplace culture? (Could be software, a system/process, or anything else you define as a tool.)

Gonzales-Black: In all the companies I work with, people have found the Holacracy Governance meeting structure to be helpful. It provides an explicit structure for decision making that balances individual expertise with team knowledge, which so many companies struggle with.

Diana: Workplace communication and collaboration platforms such as HipChat and Confluence are fundamentally changing the way we work by removing friction that exists within teams. They support some of the hottest trends in the workplace, including transparency and flexibility and ultimately enhance efficiency and camaraderie across teams. Additionally, they break down information silos, bridge the distance between remote teams, and get new employees up to speed more quickly – all while bringing a more human element back to workplace interactions.

9. Who in corporate culture (person or organization) doesn’t get the credit they deserve and why?

McCord: I don’t like the question. Credit is earned by real contributions to the business. It’s not granted. It is deserved when it matters and is measured by the same metrics for success as everybody else.

Chris Fussell: Definitely the chief of staff. In the military and in government, this role is incredibly important. It’s actually a position I held serving under General Stan McChrystal in the Joint Special Operations Task Force in Iraq, and it was a powerful, formative experience for me.

The role is pivotal for making senior leaders more effective. All senior leaders, whether in business or military, have one thing in common — there is never enough time. We want to be involved in everything, know every detail and aspect of how our organization is running, but we’re physically limited. The chief of staff can be a great force multiplier — if it’s leveraged correctly, of course.

From my view of corporate America, the position is inconsistently defined. The Chief of Staff has to be more than a glorified EA or a CEO accessory. He or she should be knee-deep in the organization’s network and be able to prioritize and triage issues for you. Using this position correctly allows you to focus on the things that only you can do as the senior leader

10. What’s the organizational culture idea that people most often disagree with you on?

McCord: For me there are so many. That employees are trustworthy adults who don’t need rules, process, and permission to do the right thing. Eliminating the annual performance review. Not measuring or focusing on retention — the idea that careers are journeys and people should go many places to experience and learn new things. That mobile technology frees us and doesn’t tether us to our jobs.

Edmondson: The idea that psychological safety is crucial for ensuring excellence in any organization characterized by uncertain, interdependent work. People understand why psychological safety enables learning and teaming – but they push back after that to say that if people aren’t afraid of the boss, they won’t work hard enough. I respond by saying that if people are afraid of the boss, they’ll work hard when the boss is watching! In my view, organizational cultures characterized by high standards and high psychological safety are those that are best able to ensure excellence in a dynamic, uncertain, interdependent world.

Fussell: As we discuss in Team of Teams, we underwent a pretty radical cultural transformation at the Joint Special Operations Task Force in Iraq from 2004 on. The military and intelligence communities have historically placed a high premium on guarding information, keeping intel close to the vest. But we realized that if we were going to be successful we would have to flip that traditional model on its head. Our motto became share information until you’re afraid it’s illegal, which obviously was very uncomfortable for a lot of people who had grown up professionally with a completely different mindset.

We see this in business too. A lot of leaders are afraid to share information with their team. However, in addition to eroding trust and hampering transparency, that model really doesn’t work in the 21st century because it’s impossible for any one team to know all the answers, and you just simply can’t figure out who needs to know what information. Instead, radical transparency and concerted efforts to share context across the entire organization create an interconnected network that could adapt to changing circumstances in real time. Yes, there are risks to sharing. Yes it’s scary and uncomfortable. But I believe it works.

Gonzales-Black: I don’t know if it’s people disagreeing with me, exactly, but I found that most people I talk to already believe that they are pretty self-managing, but then I see their decision making process in action and it’s clear that they are still relying on a central leader to make decisions and provide cover. When you get down to it, lots of leaders want to implement self-management in their companies but don’t want to do it with their leadership team. It’s a constant negotiation of keeping the necessary authority and meaningfully distributing the rest of it.

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