Organizational culture is a perennial consideration and needs to be carefully understood, especially if there is any expectation or desire to change the culture. Culture includes common values, attitudes and consequent behaviors. It directs how people make decisions, there enthusiasm, loyalty and how they react to change. It can also vary within an organization, for example a 'leading edge' attitude may be found in research departments and 'customer first' value in service areas.
No entrepreneur sets out to build a lousy work culture, or even an average one. All leaders in fact want their labor forces to have passion for the work, loyalty toward the organization and to possess a perception of beneficence and fair play from management by their employees. Yet in the craziness of building the business, many fail to invest in their employees: to develop their potential, reward their labors, and to provide respect for their personal lives.
In contrast to many businesses during this difficult economic environment, many are thriving and retaining their best and most talented employees. These satisfied employees have translated into satisfied customers who translate into a stable business environment or even one that grows. On the other hand, those businesses who found their workplace cultures lacking passion, loyalty or enthusiasm have suffered disproportionately to the recession.
Building a great workplace is not just a strategic decision but also one that involves a moral component. Many of the most successful companies trace their success at least in part to their cultures. The majority of these companies receives high marks in employee satisfaction and is a hallmark of best in class.
Great workplace cultures are not born from an accidental confluence of highly motivated workers, plentiful benefits and an on-site day care center. Rather, they are intentionally created by leaders. These effective cultures are purposefully established and are not left to accidental or evolutionary design.
A people-first culture is one that contains five basic cultural archetypes into which some organizations may fall: 1) Achievement, 2) Innovation, 3) One team, 4) People-first or 5) Customer-focused. Specifically, people-first cultures are focused on building and developing organizational members above other potential activities. What leaders do and not what they say defines the organization's culture. Most leaders are not actually aware of how their actions are perceived and shapes culture. However, shaping a strong culture is one of the most important activities for any entrepreneur because it determines, in part, whether the company goes on to success.
Some have suggested that there are the three things believed to build culture: 1) Behavior, 2) Symbols and 3) Processes. To elaborate, leadership behavior--what the leadership within the organization actually does despite what they say they do--defines what individuals in the organization come to believe. Furthermore, the symbols in an organization, primarily how time and money is spent to reward people, also shapes culture. Also important are the processes an organization has for measuring and compensating performance influences culture.
As mentioned earlier, there are five basic cultural archetypes into which organizations may fall: 1) Achievement, 2) Innovation, 3) One-team, 4) People-first and 5) Customer-focused. It could be argued that ultimately organizations need to develop strength in all five archetypes. However, it should be emphasized that organizations are not likely to be able to develop all five at once. Instead, organizations can only successfully develop one archetype at a time, a process that requires time to focus each individual archetype sequentially.
In a people first culture, employee engagement is high, they want to contribute and they go the extra mile because they are in a relationship of mutual respect and trust. Employees are treated well, and they treat the organization and its customers well – a sense of fair exchange occurs. These cultures have lower instances of selfish behavior such as theft, legal suits and the manipulation of rules for personal gain.
Within a people first culture, the employee’s contribution is meaningful, and recognized. The employee’s opinion is sought out and listened to. Their individuality and diversity is encouraged and supported. Time is dedicated to developing, mentoring and supporting others, whether through flexibility of working arrangements, development and training, ensuring the safety of others. Health and safety has the highest priority within the organization.
People first cultures are usually perceived as fun. Employees enjoy each other’s company, they have forged successful relationships, and they recognize one of the benefits of coming to work is to be in the company of great people.
People feel safe to speak up. They are not intimidated; they will raise difficult issues and not be accepting of activities or behaviors which place the company at risk. Some people first cultures have a flavor of paternalism, a family feel where employees are care for and loyalty is strong. Others are more egalitarian in their approach resulting in similar results though the approach is different.
In Jeffery Pfeffer’s book, The Human Equation: Building Profits by Putting People First, Pfeffer unveils his "high performance work system" model, which includes seven key factors.
First is Employment security. This factor is fundamental to winning employee commitment. Without the fear of working themselves out of their jobs, employees freely contribute to improved productivity. The guarantee of a job promotes long-term thinking and actions.
The second is Selective hiring. Truly placing the right people in the right places requires a disciplined approach to the employment process. Selection is competency based and turns on the identification of critical skills and attributes of jobs. The caliber of employees has a direct impact on business effectiveness and market success.
Thirdly, Self-managed teams and decentralization of decision making. Peer control replaces traditional supervisory processes. A large proportion of the workforce accepts accountability and responsibility for company performance. Employees understand how their work affects the work of others. Ideas are pooled and layers of unnecessary hierarchy are removed.
His fourth strategy is High compensation contingent on organizational performance. The key to making a profit while paying higher rates is choosing the proper contingent pay format, such as gain sharing, stock options and pay for skill. Fairness and equity promote customer commitment and customer service. Employees respond to mutually advantageous goals.
Employee Training is Pfeffer’s fifth element. Well-skilled front-line employees are more flexible, initiate change, predict and solve problems, and take responsibility for product quality.
Reduction of status differences is in sixth place. A more egalitarian workplace promotes open lines of communication. Commonality of purpose is enhanced.
And finally is Sharing information. Trust of and commitment to the company both grows when information is shared. Employees are able to prioritize multiple and conflicting goals.
Pfeffer’s book also sets out a formula for aligning business strategy with human resources management practices. Pfeffer shows that if the skills and behaviors needed to support the company’s strategy or strategic intent are plotted against the organization's employee practices, the value of those practices becomes apparent, and a gap between intention and actual effectiveness can be measured.
An assessment of a company's practices can then be made to ensure external congruence and internal consistency. MuRF Systems has all the tools needed to make such assessments including determining the cultural atmospherics, leadership distribution, management effectiveness, leadership types and training and employee development needs.
