Culture is what you communicate, celebrate, and compensate. Culture is not your cleverly word-smithed statement or aspirational values or wall art or a well paying corporate job for your local screen printer. It is not some credo crafted at an offsite convention. Culture is much less glamorous and much more relevant than that.
Do you recognize this corporate Mission Statement?
We provide our products and services with a dedication to the highest degree of integrity and quality of customer satisfaction developing long-term professional relationships with employees that develop pride, creating a stable working environment and company spirit.
Maybe it’s 3M, or American Express, or GE. Nope.
But it is a company you are likely to recognize: The Dunder-Mifflin Paper Company from the NBC comedy series, The Office. If you’ve watched the Office at all, you know that this statement perfectly depicts the gaping chasm between what most companies say about their culture and what is actually true about their culture.
In one scene, in particular, Dwight is standing in front of a poster containing the mission statement. He is complaining about the new boss’s dress code as he and another employee are embroiled in a bitter political battle for the right to be the #2 manager in the office.
As was so brilliantly portrayed in the satire, we are often guilty of writing our mission vision and values on the wall and calling culture a job well done.
It is for this reason that I define culture as the following:
Culture is what you communicate, celebrate, and compensate.
Culture is not your cleverly word-smithed statement or aspirational values or wall art or a well paying corporate job for your local screen-printer. It is not some philosophy crafted at an offsite convention. Culture is much less glamorous and much more relevant than that.
Culture is what you communicate
I must start by saying sharing your culture is not wrong. Even crafting a statement isn’t inherently bad, though oftentimes flowery, complex language usually lessens its impact.
We do need to communicate our mission, vision, and values, but we need to do it in an entirely different way.
Show it before you say it
Culture is better caught than taught. If your words and actions don’t align, your people will follow your actions every time.
If you take time to craft a mission, vision, and values, I want to challenge you to do something. Don’t share it with your company. Don’t hold a big all-staff meeting. Don’t paint it on your wall. Don’t plaster it on t-shirts.
Instead, spend the next three to six months teaching your company your values in your actions and without words. This is incredibly challenging but it is also unbelievably effective because:
They aren’t listening to your words anyway.
You, yourself, are forced to live to the highest standard set by your values.
You don’t get to check a box after a two-day offsite and get back to your real work
You’ll create more momentum than any corporate event could hold a candle to
You’ll lay the cultural foundation you actually want.
If your staff can guess your mission, vision, and values (not the words but the principles), then you will have earned a massive success. If they are way off the mark, it is probably because you were off the mark, and you should re-assess whether or not your ratified mission, vision, and values are indeed your real ones.
Say it again and again
Once you say it, you have to say it again and again. Start every staff meeting with it. Start every team meeting with them. At the Ritz-Carlton, they start every single shift throughout the entire company with a short discussion of one of the core tenets of their Gold Standards.
If you aren’t sick of saying it, you haven’t said it enough. If your employees can’t impersonate your spiel, you haven’t shared it enough. As the CEO, this is your job, first and foremost. As the founder, you have an unfair advantage over the competition because the mission, vision, and values will be a 100% authentic fit for who you are and how you built the business. You aren’t some professional CEO hired from the outside inheriting someone else’s values.
Systematize the spread
Use every opportunity you can to build the culture into everything you do. I recommend at least the first day of new hire orientation be spent on the organization’s culture. And I suggest that it be the founder’s job to share it for as long as possible.
I led all but one new hire culture orientation in the 13 years I ran my previous company. Horst Schulze led cultural orientation for every single new location the Ritz-Carlton opened during his tenure as CEO. It is that important.
Build it into your meeting agendas. Build it into your hiring process. Build it into your performance reviews.
Culture is what you celebrate
I will be the first to admit that celebration is not a natural strength of mine. Like many leaders, every hill I’ve won was simply the start of my next challenge. My focus is always set on what is ahead.
This hurt my effectiveness as a leader. You can’t always lead looking forward. Sometimes the most significant thing to do is look backward and assess how we’ve done and what we’ve accomplished. This is especially true for wins.
It was easier for me to look back on a failure, pick it apart, and learn from it. I was much less likely to go back after a victory and celebrate.
But over time, my team helped me see the value in celebrating, and we did it intentionally. We started looking for every way we could to celebrate employees who moved our values forward. By the time I left, I had spent a substantial portion of my time and all-staff meetings celebrating individual and team contributions across the organization.
I cannot tell you how rewarding this work was. It was seldom easy. I always had more than enough “real” work and always felt its gravitational pull. But I believe that those contributions I made, both large and small, had a more significant impact on our staff’s lives and our effectiveness as a company than any tactical or even strategic I could have done instead.
Always be on the lookout for ways to celebrate when your team members live out your values. Use structures, be relational, use systems, and be present at the moment with your people as well.
Culture is what you compensate
This goes against almost everything I’ve seen written on culture, but I whole-heartedly believe it is true. If I were tasked to identify a company’s core values, I would ask to see their compensation plans and performance reviews.
How many companies do you know that have integrity as a core value? 1000s
How many companies do you know that bonus the sales rep who has the highest integrity? ZERO
I can’t tell you how many times of seen and stories I’ve heard where there is zero correlation between the culture and the compensation. When forced to choose between the two again and again and again, which do you think employees and managers will choose.
Enron’s values were communication, respect, integrity, and excellence, and we all know how that ended.
Boeing’s core values are integrity, quality, and safety (among others). It’s hard to believe these core values were lived out during the development of the 737 Max.
I can tell you from my own experience and my work with clients, this disconnect isn’t reserved for mega-companies. Most founders I talk to need to pull out a paper or an old email thread to find their values, but those same founders can tell me the compensation plan for their sales reps and key leaders.
Can you see how crazy this is?
For your culture to ever be “real,” you need to put your money where your mouth is, or just be honest enough to put your mouth where your money is. Either way, you’ll move forward. Either way, I will applaud your honesty. The only thing you can’t do, and really, the only thing we all do is neither. We let our compensation and culture diverge, and then we wonder why our culture doesn’t seem to matter.
You can fix it!
This is one of those easy to understand things that are hard to do. You have to reconcile the differences between your values and your compensation, and one of them has to change.
This isn’t impossible. Once you’ve selected the right core values, it is much easier to do. Patrick Lencioni says, you know you’ve found your core values when you are willing to be punished for upholding them.
What integrity looks like
I recently heard a story that I want to share with you. A sales rep was tasked with negotiating a deal with one of the company’s smaller suppliers. He went to the supplier and drove a hard bargain. He pushed and pushed and pushed until the supplier agreed to a price that left virtually no margin at all. The sales rep was so proud of the deal he rushed straight back to the office and handed the signed contract to the owner. The rep was grinning from ear to ear. No one had ever gotten a deal that low. The other reps said that kind of margin was impossible. But he had proven them all wrong.
Then after quickly scanning the contract, the owner looked up. Where the rep expected a smile, the owner frowned as he tore the contract straight down the middle and threw it in the trash.
Shocked, the sales rep could barely mutter, “What are you doing? That’s as low as I could go!”
The owner responded, “That is the problem. With margins like this, our supplier won’t be able to stay in business.” Integrity was the owner’s value, and he was willing to literally throw money away to keep that value.
The story was told to me by the sales rep. He said he learned an incredibly valuable leadership lesson that day that has guided his actions ever since.
Moving forward
I would imagine that after reading this, you realize you have some work to do. In full transparency, while I was writing this, I realized I had some work to do. Even if this isn’t new news for you, like our employees, we need to be reminded more than we need to be instructed.
There is no greater endeavor than for you to invest your time, energy, and money in the culture of the company you built. You will get an exceptional return on your investment when you realize culture is what you communicate, celebrate, and compensate, and then set about the work of aligning all three. Once those three are in alignment, you’ll be able to bring the alignment to your team and company you have always longed for.
About the Author
Scott Ritzheimer
Scott’s passion is equipping successful brands and business owners to build a lasting legacy that makes the world a better place. That’s why he started Eight Figure Focus, a business growth consultancy, which specializes in helping leaders and their teams overcome complexity and create the clarity they need to generate lasting growth using both the Predictable Success and StoryBrand frameworks. To learn more, visit www.eightfigurefocus.com.