Scale up culture: How to grow your business without selling out.
Startups are often known for their vibrant and exciting cultures. Scale-up cultures have the potential to be just as exciting, dynamic, and supportive too.
But, scaling up a business can be a nerve-wracking time. There are lots of things to consider- investors, funding, new business opportunities, growing your team and creating new products. It’s quite easy to be consumed with these considerations and to forget about your culture. But if your business is growing, then your culture has already been a vital component in your organisation’s success to date. Now as you scale, stakeholders may begin to get involved, investors or consultants, and there may be temptations to adapt or requirements to make changes to your business that can impact all those good cultural attributes that got you here in the first place.
What is Business Culture?
Your culture will have grown and developed throughout the lifetime of the business. It is “the way things are done” and often sits as an unseen presence, influencing every action, process and attitude. But whether that culture remains stable, and asserts a positive or negative influence on the profitability, reputation and longevity of the business as it grows, can be a bit hit and miss unless the top team of the business take steps to monitor, manage and steer the culture in a direction which supports the strategy and rapid growth.
The importance of Culture to Scale-Ups as they grow.
Culture creates a sense of purpose. It changes a group of people into a team. It sets the path and tone for the business and creates a set of values and behaviours to reach your goals. It helps onboard, embed and empower your team. It helps retain your talent and attract new talent. It quashes staff churn and engenders brand advocacy.
A strong culture improves business performance by motivating employees and coordinating them towards a shared vision that helps them achieve performance goals that drive profitability.
You may recall the Workforce Purpose Index that showed that 58 per cent of companies with an articulated, understood sense of culture experienced over 10 per cent growth, compared to just 42 per cent of companies that don’t make their purpose a priority. (LinkedIn and Imperative’s Workforce Purpose Index).
We know that engaged staff are more productive, but businesses with highly engaged staff also see a 41 per cent reduction in absenteeism and a 17 per cent increase in productivity. (Gallup’s State of the American Workplace report).
More strikingly, The HBR recent report Time.Talent. Energy shows that an employee who feels engaged and inspired is 125 per cent more productive than a satisfied staffer. (Bain & Company’s Time. Talent. Energy).
Clearly, there is a direct correlation between a strong culture and business performance. Costs are reduced when absenteeism is low and staff retention is high. Sales grow through customer service excellence and high staff productivity. All of these metrics are critical when scaling, and reinforce the importance of culture.
“Corporate culture is the only sustainable competitive advantage that is completely within the control of the entrepreneur.” – David Cummings, Co-Founder, Pardot
How do you scale culture as you grow?
The idea that you must retain your culture shouldn’t strike fear in you. It’s not about taking a magnifying glass to every tiny facet of your business and documenting the minutiae in big old dusty books to sit on your shelves for the next millennia. But it is about stopping to reflect and starting by consciously prioritising your culture.
1. Prioritise Culture
It’s surprising how many businesses still don’t consider their culture a ‘thing’. Or often if it is a ‘thing’, it’s a fluffy, and hard-to-define kind of one. So, the first step is to make your culture a point of reference. Stop and consider your culture, define it, and make it a key component of your top-level business strategy, if it isn’t already.
Smaller businesses sometimes think they aren’t established enough to set out culture as their own strategy point but think of all these global brands that started out as tiny entities. ShutterStock began when Jon Oringer, a professional software developer and an amateur photographer used 30,000 photos from his personal photo library to start a stock photo service that is currently worth $2 billion. Hubspot began in 2006 when Founders Brian Halligan and Dharmesh Shah were working as independent contractors helping startups with their marketing strategies. Instagram started as a side hustle in 2010 for Founders Kevin Systrom and Mike Krieger, and even Ralph Lauren was working as a sales assistant at Brooks Brothers when he got the idea for his clothing company. Size is irrelevant to potential, and think of the jump you can have on success if you start out with your culture as a central pillar to your growth.
2. Assess your Culture
Once you’ve established a focus on your culture, the next step is to assess it. Sometimes with rapid growth comes culture strain – ways of working can become outgrown and need to be adapted, management practices need to change, and the employee experience and expectations need to be refreshed.
Unless you revisit and assess all the things that make up your culture, that very culture that has fuelled your success today could ultimately squash the success of the future.
Assessing your culture will identify the positives you have as well as show you any hidden cracks, misalignments or bottlenecks that might have caused you issues down the track. Using a model like the Culture Consultancy Organisation Culture AssessmentTM will allow you to understand the way things are currently done and identify what is supporting your strategy and growth as well as highlight potential culture blockers
3. Articulate your Culture
Once you’ve assessed your culture, and identified all the bits you want to keep and all the bits you might need to adjust as you grow, it’s then about articulation.
You need to design and communicate the culture that will mobilise your people to execute on your culture plan as you grow. It starts with vision, values, and behaviours, and moves into working practices. Once you’re clear on these things, you need to think about embedding them in your day-to-day business.
4. Enlist Employees.
Enlisting your employees to live and breathe your clearly articulated culture is your key way to embed your culture and happens partly through the mechanism of employee experience.
This is the sensation that your employees have as a result of working for you regardless of whether they are based at your company site or remote working. Whatever their position or location, you need everyone in your company to know and feel good about the company culture.
A positive employee experience will ensure greater employee satisfaction levels, productivity, performance and wellbeing. It will also enhance your employer brand and facilitate the attraction and retention of the most talented people.
5. Bring in people that match your values
The founders and start-up team of a business will have the clearest insight into the culture because they’ve been a part of the team since its beginnings. Especially in the early stages of scaling, hiring decisions are integral to success and sustainability, not only in a financial sense but in terms of culture.
In the early days of business, or when companies have a small number of staff, it’s easy and fairly implicit to make hires. There’s an unspoken understanding of the culture, and it’s easy to know those values and behaviours that fit. However, when teams grow quickly, companies can become more relaxed in their criteria for hiring new employees, or less clear on the attributes they are hiring against unless there is a clearly articulated culture in place.
This can be detrimental to company culture as bad hires can have greater costs than lost time and recruitment costs. They can impact other employees and their productivity too.
6. Lead culture from the top
To have a positive aligned culture an organisation needs strong, effective leadership with a defined sense of purpose. Culture change may not always be driven by the CEO and the leadership team, and certainly, culture needs to be embedded right through an organisation, but the behaviours and actions displayed by the people at the top are visible to all who work there, therefore they match the desired culture. Walking the talk is necessary to keep the culture alive.
“I used to believe that culture was ‘soft,’ and had little bearing on our bottom line. What I believe today is that our culture has everything to do with our bottom line, now and into the future.”
– Vern Dosch, author, Wired Differently
How Culture Consultancy can help
The Culture Consultancy team has a range of tools to help assess, design and embed culture.
We talked in this article about the Culture Consultancy Organisation Culture AssessmentTM which allows an understanding of the way things are currently done. It identifies what is supporting your strategy and growth as well as highlights potential internal misalignment or culture blockers that are impacting business performance.
The assessment can be completed by the whole company or just within a division, department or large team.
There are many ways in which the insight from the Culture Consultancy Organisation Culture AssessmentTM can be used, including:
- Identifying existing attributes which are helping performance, and those which are hindering.
- Assessing how well the organisation is aligned for delivering against your strategy or transformation (new or existing).
- Identifying immediate untapped performance improvement opportunities.
- Understanding variances across the organisation so you can focus attention on the right areas in order to gain full cultural alignment.
- Demonstrating progress to stakeholders, including shareholders, regulators, the media.
- Identifying mismatches with 3rd party providers which may be impacting your service and/or commercials.
- Providing a baseline measurement for future alignment or change, hence providing you with an ongoing tool for guiding the required culture.
We can also help with leadership development. We have a range of leadership programmes that equip leaders with everything from the basics, such as setting a vision, engaging your people and modelling the right behaviours, right through to the skills and knowledge required to create high-performing, innovative and digital-enabled teams, divisions or companies.
We develop future-proofed leaders who build resilience and adaptability, harness the talent of others, horizon scan for future trends, and become digital savvy, all while being fully authentic, ethical and inclusive.