“Culture is the set of beliefs, values, and norms, together with symbols like dramatized events and personalities, that represents the unique character of an organization, and provides the context for action in it and by it.”
– Gareth Morgan

“Leadership defined by “To lead is not to influence others to do something they are not committed to, but rather to nurture a culture that motivates and even excites individuals to do what is required for the benefit of all.”
– Arthur F Carmazzi

This is a test: Describe your company’s culture in one sentence.

If you’re hemming and hawing right now, it’s probably because your organization hasn’t defined and institutionalized its culture. Although that may not sound like a big deal, it has critical implications for the health – perhaps the very survival – of your company.

In an organization without a clearly defined culture, everyone operates on his or her assumptions of what is required. Some managers expect employees to give 150%, while others let their workers skim along with only minimal commitment. Some departments seem to be managed democratically, while others are managed by “tyrants” who neither value nor permit input and feedback from their employees.

It should come as no surprise that companies without a clearly defined culture have trouble keeping good employees. Go-getters quickly grow frustrated as they try to figure out and work around inconsistencies and internal politics. They begin to wonder why they’re working so hard when management turns a blind eye to areas of the company that are merely coasting along. As soon as these A players get a better offer, they’re out the door. Managers, either unwilling or unable to recognize the real problem, tell themselves that “he never fit in here anyway” and all will be well as soon as they hire a replacement. Thus begins another cycle of hiring without defining the company’s beliefs, values and expectations – its culture.

First, know thyself

Plato’s advice is as wise today as it was in his own day. The first step to breaking the cycle is to define your company culture, which begins with the three fundamentals of your business:

• Mission – the reason your organization exists;
• Vision – where your organization is going, and
• Core values – the basic beliefs and expectations underlying your organization.

Your organizational culture will develop from these fundamentals and will define how the business operates on a day-to-day basis. The culture will drive:

• Management style: Will management be democratic or autocratic?
• Work environment: Will it be an environment of empowerment and accountability, or scapegoating and blame?
• Performance expectations: Will you expect employees to achieve goals and reward them when they do, or will you merely pay lip service to strategic planning?
• Commitment to employee growth: Will employee development and advancement be a strategic investment or an unnecessary expense?
• Strategic hiring: Will you hire candidates based on their commitment to the organizational culture as well as their skills and capabilities, or will you consider cultural compatibility only when problems arise?

If you’re still not convinced that culture counts, consider this: According to a five-year study of 160 companies reported in “What Really Works,” by Nitin Nohria, William Joyce and Bruce Roberson in Harvard Business Journal (July, 2003), culture was one of four primary areas that distinguished the most successful companies from the least successful. A great company culture attracts the best and the brightest. It will help ensure not only short-term success, but long-term growth and profitability. And that’s why company culture counts.

Has defining and institutionalizing your culture made a significant difference in your organization?