Human Capital

How Your “Happy”​ Culture May Be Hurting You

February 15, 2017

You should be using your culture as a strategic weapon, not retroactively managing it to suit the purpose of the day.

When I work with teams to define their culture, most often they will start with a bucketload of positive adjectives: accepting, proactive, innovative, happy, high performing, customer-focused, accountable. Some may even attempt to craft a statement shoehorning in as many of these into one sentence as possible.

The problem is that many people equate a good culture with a “happy” or a “friendly” place to work. They focus on positive culture, and the culture is targeted too much on how the employees should feel, versus how the company can deliver exactly what the customer needs.

Let me say that again, in a different way:

Your culture should optimize your revenue, not employee happiness.

Sure, happy employees may be a way to deliver outstanding customer service, drive customer acquisition, spur innovation, and increase margins. Happy employees may also help your employment brand, helping you hire the best people. But what you really want is productive employees. The two may be highly correlated in some companies, but it should not be given as a base assumption that it is always true.

Your culture should drive individual engagement with the strategy.

Employees should be motivated in every way to help the company win. This includes compensation, career path, and culture.

You should be entirely focused on engineering your culture to maximize results, using your culture as a strategic weapon, not retroactively managing it to suit the purpose of the day.

Your people strategy is as important as your product strategy.

The best companies are laser-focused on their core strategy and service, and do not chase every customer across every channel for every product. They are ruthless about what they don’t do. This must be the same for culture.

You have to be clear about who you are not, as well as who you are.

If you have a culture manifesto, do you include what your culture isn’t?

Some examples of focused culture:

  1. Many professional services firms (law, consultancies, investment banks), are clear that they are not a happy place to work. They promote the fact you will work insane hours, have no work life balance, and that you may hate your boss and compete with your co-workers. People may yell at you. But these companies will also be clear that they don’t expect you to stay long, that they will accelerate you into the c-suite a decade ahead of your peers, and that they will work you two jobs, and pay you for three.
  2. Some of the best customer-centric companies are the worst on employees because they are focused on delivering customer service. The pace of delivery is relentless and the availability of employees must always be high. You’re always on call and you’re always stressed. This can be especially misguiding when you are joining a company based on it’s product brand, rather than it’s employment brand. What the company is looking for is people who are motivated by relentless pressure and rewarded by direct customer interaction and customer satisfaction.
  3. Companies focusing on innovation can purposefully sub-optimize their execution, and vice-versa. Innovative companies may find better results when there are skateboards, dogs and a smoothie bar in the “office.” On the other hand, companies that focus on constant delivery and repetition without error, will focus on stability and will be looking for people intrinsically motivated by constancy and predictability.

Culture will change all the time: look at the banks.

In the banks, where once the culture was dominated by constant delivery with no errors, much of the back office is being automated. The remaining employees are now under pressure to innovate to find new revenue sources, interact with customers in new ways, and adapt to tremendous technological change. How do you do a 180 on culture, retain your domain expertise, but become a new thing completely? You must keep your culture in line with your product, and to do that, you have to be as clear and purposeful in your culture as you are in your product. They go lock step, hand in hand.

As Mercato’s vice president of human capital, James Greaves empowers entrepreneurs and their teams to turn a company’s biggest asset—its people—into a competitive advantage.


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