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Corporate Culture Matters: Outmaneuvering Competition in New Markets

Posted by: on 16 February 2016 in Human Capital Management

Organisational culture has always been a vital issue in the C-suite, but recently, the discussion about the true value of it has found traction. In a world of commoditisation, automation and rapidly changing technology, sustaining corporate culture in new markets is being viewed as a competitive advantage, according to Forbes Magazine. HR leaders are engaging in conversations with executive teams about retaining corporate cultural ideology during periods of growth. It’s undeniable that culture matters, and executive teams are looking to it as a differentiator that competitors cannot duplicate.

Maintaining culture as your organisation expands is achievable with deliberate action in the same way that an organization executes any initiative. According to Josh Bersin, founder and principal of Bersin by Deloitte, “Culture is driven by leadership,” offering advice to C-suites wrestling with this issue.

Lessons from successful organisations with strong cultures can offer insights into innovative actions that preserve corporate culture in new markets:

  1. Culture Is About People, So Hire Right

In 2010, Tony Hsieh, founder of Zappos, released a book called “Delivering Happiness: A Path to Profits, Passion, and Purpose,” which relates the investment in culture to the success of Zappos. Hsieh describes two decisions that made it possible for Zappos to protect the organisation’s culture as it grew from a start-up to a billion dollar enterprise.

First, Zappos deliberately hired people who fit the pre-existing culture. Interview questions were specifically designed to assess whether candidates would be able to assimilate into the culture of the organisation, and hiring managers were trained to look for those traits as well. Zappos had made the choice to prioritise fit over skill. Second, Zappos paid new hires to quit. Unfit hires are inevitable, and Zappos wanted to make it easy for people to admit it wasn’t the right place for them. Managers were also empowered to correct mistakes in hiring when necessary.

  1. Focus on Values, Not Culture

Consider the United States as a fast-growing organisation. The culture of the United States is different today than it was in 1787. So, how did the United States thrive as a united organisation while growing so fast? It focused on its base tenets: the Bill of Rights.

Accepting and adapting to the unavoidable cultural changes that take place over time in longstanding organisations is critical. The Hewlett-Packard that was founded in 1939 obviously does not have the same culture as the HP of today, but the core values, or “HP Way,” established at its inception, such as innovation and integrity, are still embraced despite the massive growth experienced over the years.

Their commitment to these values can be seen not only domestically, but in their global initiatives, as well. They have instituted the supply chain responsibility (SCR) program “to protect and empower workers, and to reduce global and community environmental impacts while simultaneously creating benefits for HP and our customers.” This program encompasses a number of global initiatives dealing with everything from corporate social responsibility (CSR) to social compliance and accountability on an international level. Recognising that, to fully engage their employees and embrace a culture of integrity, the organisation had to prioritise the needs and safety of workers at every level and region, even those not directly employed by it.

This emphasis on a nucleus of founding principles is not an ideal exclusive to the U.S.   A consulting firm in the Netherlands, &samhoud, was recently recognised on the Great Place to Work, 13th Annual 100 Best Workplaces in Europe List for their “human-centred, serve-all-stakeholders culture.” The organisation uses innovative and unorthodox methods to disseminate their core beliefs, such as a hiking adventure for new employee orientation and a bonus to workers who resist checking their work emails during vacations. These practices may not be considered unconventional for long, however, as the report indicates their “revenue jumped 24% last year.”

As organisations grow and establish locations in new markets, new cultures will emerge; executives should be thinking about core values, because that is what will ultimately drive culture.

  1. Teach. Communicate. Reinforce. Repeat.

Upholding a culture is about reinforcing values through repeated communication over time. Sam Hodges, Co-founder and U.S. Managing Director of Funding Circle, says it this way: “Don’t worry about saying the same thing over and over. That’s a big part of the job.” Executives should communicate frequently and in a variety of ways. Aside from visiting offices in person as often as possible, executives could write an internal blog or record video messages that can be shared throughout the organisation.

One innovative approach finds executives facilitating an internal massive open online course (MOOC). The C-suite works with the learning and development team to create a four- to six-week self-guided course on culture, and all employees are invited to participate. This course could be run two to three times per year to give employees at every level and tenure a chance to learn about the culture directly from leadership.

The fact that your business is expanding is a direct testament to the success of all facets of your organisation. Retention of the culture that has helped lead to this period of growth is, therefore, paramount to the continued prosperity of the organization. It can be difficult to ensure these ideals are not weakened and ignored as the organisation faces new challenges over this time. This potential loss of identity can most certainly be avoided by focusing on finding the right people, promoting core values, and continuing to educate both new and long-standing employees alike.

Written by: The ADP@Work team


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TAGS: core values corporate culture organisation identity Tags Human capital management