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Corporate culture is what you make it

Tuesday, October 19, 2010

The challenge: establish new behavioural norms in an established company. Where to start: leadership

NORA UNDERWOOD
Special to The Globe and Mail

When Will Andrew took over as president of Trimark Sportswear Group in June, he had a sense of what he wanted to tackle. The Richmond Hill, Ont.-based logoed-apparel company had come through an exciting time - a big move to a new space from its 35-year home in nearby Markham, and an association with the 2010 Olympics in Vancouver as one of the official licensees.

In the back of his mind, Mr. Andrew knew he wanted to take on culture as a quiet personal project while concentrating with the group on other strategic initiatives. But after he met with consultants from Oakville, Ont.-based Managerial Design Corp., it was clear that evolving the culture at the sportswear company was not just important, it was the top priority.

"We did an exercise - What Drives What? - and everybody unanimously voted that culture was what drove everything else," he says, citing customer experience, sales and inventory control as examples. "I was quietly worried whether culture even fit in the top six. I certainly didn't anticipate it was going to be No. 1."

What exactly is culture and why should anyone care? The notion of corporate culture was only floated during the 1980s. Even less than a decade ago, when Marty Parker was founding Waterstone Human Capital in Toronto - which started the successful annual awards program Canada's 10 Most Admired Corporate Cultures - he still wasn't certain how much interest there would be.

The fact is, the companies our parents worked for had cultures, too; they just weren't called by that name. More likely, as Mr. Parker says, it was "how we do things around here." And that's what it is, in the simplest form: the collective behaviour of people in an organization. "It's the norms of behaviour and the expectations as a result of those norms of how people act and behave. It's not values and it's not aspirations."

One of the country's most successful businessmen, Isadore Sharp, built the Four Seasons luxury hotel chain with the Golden Rule as a pillar of his culture. "We aimed to treat others as we would want to be treated ourselves," Mr. Sharp has said. "Enforcing our credo was the hardest part, and senior managers who couldn't or wouldn't live by it were weeded out within a few years."

The reality is that a strong corporate culture has a positive impact on a company's bottom line. And in today's organizations, particularly small businesses where management tends to be much more visible, it is leadership that drives the culture. Leaders create the desired behaviour by modelling it themselves.

The first task, though, is determining who you are as a company - not who you want to be or who you think you are. "Different organizations have different cultures because they need different things in people," says Neil Crawford, leader of the Best Employers in Canada study at Hewitt Associates.

For a business like WestJet, for example, culture needs to be process-oriented and operationally focused. The same is true of Air Canada. But, as Mr. Crawford explains, each company can put its own spin on the culture. "The personality is different but they do the same thing," he says. "How do we find people who do things the WestJet way and do it efficiently?"

The most successful organizations, experts agree, align all their systems - hiring, training, managing, assessing, compensating, rewarding - to their cultures, to who they are and what values they hold. Ideally, people know what is expected of them and why, and they feel they are all working toward the same goals.

For Zappos.com chief executive officer Tony Hsieh, strong culture and employees with good cultural fit are the foundation of his hugely successful online retail business. Potential employees are interviewed at length and also specifically for cultural fit, with questions relating to each of Las Vegas-based Zappos' core values. Once hired, new employees are trained in customer service, culture and core values.

At Trimark, Mr. Andrew is already knee-deep in changes. He has identified problem areas - everything from interior design issues to training shortcomings and communication gaps - and has already, with help of his senior staff, taken steps to address them. To that end, he writes regular news blasts to employees, will start quarterly town halls, has formed an employee council (known in the office as the Culture Club) with representatives from all areas, and is planning a redesign of Trimark's new home.

Equally important, a new full-time human resources manager will help keep the lines of communication open between senior staff and front-line workers, and will help make sure that new employees are onside with Trimark's vision and goals.

For a culture to be strong, fit is key. Any change in culture is going to be embraced by some current employees, slowly digested by a few, and potentially rejected by a few more. And this is one of the real challenges of driving culture change. Some may see themselves as a poor fit in a new order; others may just need a bit of time and training to come around to a different approach.

But ultimately, building a strong culture boils down to having people who live the desired behaviour. "It's not to hiring people like you necessarily," says Mr. Parker. "It means hiring people who are successful with behaviours that fit your organization."

Strong culture is important in any business, but even more important in small business, so really knowing who you are is key, particularly when it comes to recruiting. "It's a double-edged sword," he adds. "People can have a greater impact in a smaller business in a shorter period of time, but one misfit or one bad hire can have a much bigger impact in a much shorter period of time."

In the end, whether you call it culture or not, every business has one.

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HOW TO CHANGE CULTURE

Identify the need

You may not be able to articulate it yet, but culture change starts to happen when the leadership "has a sense that the team needs to be committed or aligned to something, and they're not there yet," says Catherine Parsons Dhamija, senior director of Managerial Design Corp.

Get help

Facilitators can help leaders figure out how to put who they are and what they want into words, and then determine with them strategies and action plans to get there. Their role can be short- or long-term.

Walk the walk

Leaders have to live and breathe the behaviour they expect of staff. "I can tell you I want you to stand on your head from 9 to 10, why it's important for the organization, what's in it for you," says Debra Horsfield, a senior consultant in the talent management and organization alignment practice at Towers Watson. "But it's not just about informing; it's about what do I have to do differently, what does that look like and how do I do it?"

Listen and communicate

If managers understand what's expected of them and have the time and training they need to get there, and if the staff are clear on company vision and goals, about what changes are under way and why, the effort will have been worth it.