You know business culture is important. But you’re not entirely sure why. Or how to influence the culture in your own business.
Culture is an ephemeral thing. It’s often hard to get to the root of why one business’s culture is more successful than another. One thing is clear though. Strong cultures create happy workplaces. And happy workplaces make for more productive staff.
For me, a powerful culture centres on assembling a high performing team and enabling them to work effectively to drive a specific outcome. This is what happened at Rackspace and Peer 1, where we worked hard to create the right environment for talented people to do their best work. The result? Both companies grew from zero revenue to £30 million in just five years. A pretty stratospheric growth curve, particularly as this growth took place through two recessions.
So what did I learn from my experience as MD of these companies? What are the 10 most important features of a strong and powerful culture?
What is the outcome that you’ve come together to deliver on? The ‘why’ of your business? Your reason for existence? Purpose is at the heart of a strong culture and you need to spend time working it out. I recently interviewed Horst Schulze, founder of the Ritz Carlton group, for an up and coming episode of my Melting Pot podcast. He described the purpose of his company – very simply, to be the best hotel chain in the world. In his eyes, there’s a crucial difference between leaders and managers. Leaders motivate through purpose. They make it very clear why they’re doing what they’re doing – the impact that it’s going to have long term. They spell this out clearly and ambiguously. There’s a collective sense of being on a mission to fulfil purpose, both at an individual as well as an organisational level.
What types of people do you want on your bus? Who’s going to join you? This is fundamental as the people you choose will form your culture. It centres on the tonality of your business. Here’s a great story. Two managers are recruiting in a pair. They walk into a room of candidates and accidentally spill a load of papers onto the floor. Three or four people jump up to help them tidy up. And, you guessed it. They’re the people they go on to hire.
You’re looking for instinctive characteristics that show up unconscious beliefs and behaviours. Off-guard moments will often be far more insightful than hours and hours of interviews. The person who offers to take their mug back to the kitchen to wash it up after their interview. Immediately you see accountability. And motivation – this is a big one. I strongly believe it’s not the job of a manager or leader to motivate their team. People need to be self-motivated – these are the people you want to join you. So, look for people who have the same core beliefs as yours.
In all the cultures that I’ve built, I’ve looked for the trait of responsibility in new hires. I'm a big fan of CliftonStrengths, Gallup’s personality assessment tool, as it gives such accurate and unique profiles. In the Customer Support function at Rackspace and Peer 1, we only took on people who had ‘Responsibility’ as one of their top 5 strengths. That’s because we knew these people couldn’t help but stick to their word. They wouldn’t go home until they’d followed through on their promise to their clients or colleagues. Ownership was part of their DNA so we knew we could rely on them. And we didn’t have to set up systems to police this.
In turn, this will foster a culture of responsibility. You want everyone to be asking themselves, ‘In aid of our purpose, what am I going to do? How am I going to track my score? How do I make my progress transparent?’ And if they’re stuck, they need to be comfortable asking for help. It’s inevitable that not all your staff will have responsibility as a strength. As a result, you’ll need to put in a process that practices and reinforces those behaviours.
‘Learner’ is the other strength you should be looking for. Wherever I’ve scaled a business, I’ve found that 75% of the staff have this in their top 5. When I interview, I always look for curiosity. Because one thing is absolutely true in life – there are always things that we don’t know. If you’re not interested or want to learn, then you won’t be right for the type of culture I want to create. In his best-selling book, ‘Drive’, Daniel Pink talks about the importance of ‘autonomy, mastery and purpose’ to motivation. And I want any people I hire to become masters of their craft. To do this, they need to look for continuous improvements. Without learning, this won’t happen.
Similarly, a strong culture will focus on corporate learning. You want to create an environment that is constantly questioning – looking at processes and techniques and asking, do these still work for us? Have they become overly bureaucratic? At Rackspace, we continually adjusted and changed the ways we worked. Examples included our ‘StupidRules@’ email address where staff could highlight things they thought needed changing. Or asking every employee to find four hours a week that they were wasting. Wherever you went, there was a constant drive to improve performance.
‘No dickheads since 1999’. That was the banner over the desks of one of our IT teams at Peer 1 in Atlanta. A vivid memory! I recall their collective sense of being great and wanting to be even greater. They took real pride in their achievements, both at an individual and team level. And this sense of pride built trust. They relied on each other for their mutual success.
So often in organisations, there’s a silo mentality with departments openly pitted against one another. Finance may be doing its job well. Customer Service too. But fingers are pointed at Marketing or Sales as the weak links in the chain. You come across the same mentality as a group of seven-year-olds playing football. They lose their match with a final score of 5:2 to their opponents. But the striker goes home and tells his Mum he did really well because he scored 2 goals. The fact that his team lost the game is not important to him. It’s this lack of collective accountability that you need to overcome for a successful culture.
This is a big one. For a culture to be strong and healthy, you need to set clear expectations. Employees need to know exactly what’s being asked of them. Often these conversations can be challenging so people shy away from them. But without clear parameters, staff will be unable to track their progress in real-time every day and benchmark themselves against clear goals.
As an organisation, you need to ask whether your expectations are too inwardly focused. Are they reasonable? Do your customers have higher expectations of you? This is where the 3HAG attribution mapping and core customer work I do with clients can be massively helpful. Once this is completed, my clients have a clear picture of where they are in the market, what they can be world-class at, what they need to do to reach that goal, what their talk trigger is etc. etc.
‘I really fancy doing some brain surgery – can I practice on you?’ Not the words you’d expect from the mouth of your GP when you go to see him. And yet, all too often, sales teams are let loose on precious corporate assets – prospective customers – with no training at all. I get it. Salespeople hate practising. I’ve led enough consultative sales training exercises to know this. But it’s insanity not to give your staff proper training. Without practice, people don’t get better. That’s why I bring leadership teams off-site two days a quarter at my Management Lab. Here, they can work ON the business and not IN the business.
Be aware that often a plan is a waste of time. It’s the planning itself that’s more important. I particularly love a good pre-mortem. They’re effective because they help build a culture of psychological safety in a business. That idea that you seek criticism, internally and externally and this is part of your DNA. A pre-mortem shows you have a process for eliciting criticism of your plan. It also demonstrates the lack of ego in the managers involved – they’re happy to share their plan and have it eviscerated by the team.
Ah yes – tricky conversations. Being candid is difficult. But it’s vital to a healthy culture. You need to be able to have those 'no holds barred' conversations with both your customers and your staff. These should always come from a place of wanting other people to be the best versions of themselves. You should then expect your teammates to treat you in the same way.
Whether it’s as minor as having spinach in your teeth or a more serious case of under-performance at work, they need to let you know asap. Particularly if you’re letting yourself or your team down. A healthy culture will encourage psychological safety so that this behaviour becomes the normal way of doing things.
It’s easy to go to the gym once. Even for a couple of weeks. But quite often people overdo it. They get burnt out, injure themselves and then can’t sustain the effort because they’ve tried too hard. The same things apply to your culture. Regular rhythms are central to real progress so you need to pick things that are doable. Your belief should be that when you start something, you can continue forever because it’s not a huge effort.
A good example is daily huddles – something I advise all my clients to do. Back to that conversation with Horst Schulze. I said to him, ‘People think they have no time for huddles’. He laughed and replied, ‘The people who need huddles most are the busy people who say they have no time for them!’ Your recruitment process, your staff on-boarding, your All-Hands meetings – all of these will reinforce your culture and tie in with purpose, responsibility and character. They should be permanent stitches in the fabric of your business, holding everything together.
This is why I often hire people who play team sports. People who’ve had to practice consistently for something. Team GB gymnasts, swimmers, rugby players – they all have to train. They’ll do it in the rain. They’ll do it in the snow. They’ll turn up on a Saturday. And they’ll have an amazing sense of team. Whether they know it or not, it’s important to them. The regular rhythm they’ve applied to their training has rewarded them. Otherwise, they wouldn’t do it.
We’re not on this planet on our own. There are always those who are less fortunate than we are. Look at your business environment and work out what you can do for the benefit of others. It’s amazing the effect this can have on a team and the huge sense of pride it engenders. In the past, I’ve set up charity committees with events organised almost every weekend. We’ve always had a corporate charity and my own, personal charity supports education in India.
Dominic has spent 14 years working in sales, marketing and business management within the IT sector. He has held executive positions at Peer 1 Hosting, IT Lab and Rackspace. At Peer 1 he built the UK business to £30m run rate in 5 years. He won many awards for creating a great place to work. At Rackspace Dominic built the UK company from four to 150 staff, and increased annual revenues from £595,000 to £25 million in just four years. Under his management, Rackspace was recognised as one of the most outstanding workplaces in Europe, and won several service awards for its Fanatical Support TM. Dominic has a BSc in Agricultural and Food Marketing from Newcastle and a MBA from Sheffield Business School. Dominic is also a regular public speaker on creating great places to work and achieving continuous client satisfaction and an assessor on the Sunday Times Customer Experience Awards.