HBR.org article from July/August 2018 issue

Less Beer, More Substance & Other Things I Believe About Culture

My article, “Why Great People Leave Great Cultures” in HBR was one of the most-read articles in 2018. Scores of people sent me emails and messages on LinkedIn. Even more sent me direct messages and retweets on Twitter. Videos were even made on Instagram that summarized what I had shared (thanks again, Matt). Many people commented on the article directly at HBR.com. It clearly resonated with leaders and employees all over the world, at every level, across every function. And I know why.

It was not because of quality writing (though, I am working on that) or because the topic is new. Culture, engagement, and what makes a great company are timeless. It was for three reasons: 1) it was practical; 2) it was relatable; 3) we are angry.

We are tired of the hypocrisy. We are fed up with the double standards. We are sick of the HR-speak. We are tired of the company that says it is all about love but leaves employees standing on street corners, boxes of personal effects in hand, with no explanation as to why they just got terminated. We have had it with the company that waxes on about the value of complete work, but has a leadership team who leaves a mess of food and paper in the conference room after their morning meeting. The little stuff becomes big stuff. And the big stuff becomes culture. We know what good cultures look like, and it is not this.

All too often, that little stuff does not get discussed. It festers until we realize we are losing people. We get caught up in what we are supposed to say about culture and lose sight of the actual behaviors that are happening around us, every day. Sometimes, incessant talk about culture can even be a red herring for the toxic one hiding in plain sight.

A strong culture is built on a system of intentionally defined behaviors, processes, and practices. Hiring, developing, assessing, and structuring are part of the business strategy, not just aligned with it. Yet, we increasingly hear about the consequences of companies failing to build a strong culture: leadership turnover, increased attrition, low employee morale, and a declining customer base.

More disturbing are the poor efforts to eliminate workplace sexual harassment and discrimination. We have often allowed these problems to manifest in subtle ways that are tacitly ignored, and over time, tolerated. In the service of being fast and appearing strong, they may even be quietly encouraged by toxic leadership teams in toxic cultures.

Often great cultures fail to be built because of fallacies that were created and reinforced over time. Here are six:

  1. Fallacy: High-profile culture awards given at the company All-Hands meeting are powerful cultural amplifiers, especially if accompanied by a slick powerpoint deck, inspirational talk, and values artwork on the walls.

Truth: The more culture is talked about and the less it is supported by behaviors, the more these talks ring hollow. They become disingenuous and are ignored. As I stated in my HBR article, culture starts with values. Leadership must actively express culture every day through behaviors. Culture must be reinforced through daily processes and practices.

2. Fallacy: We can figure out the culture later — when we are bigger — or when we start seeing issues.

Truth: Thinking about culture later is like saying that we will develop the UI after we have developed the product. A culture that starts out as a reaction will stay as a reaction, struggling to get ahead of issues. It takes less time to address cultural practices and processes proactively than reactively. Long-term planning is hard. We can lose sight of anything that offers delayed gratification. Yet, without people processes driving a great culture, what is the point of short-term gains when all of your great people leave?

3. Fallacy: We have a great founding team with a great product. If we hire right, a great culture will organically evolve.

Truth: Strong cultures will no more spontaneously emerge from great people than great products spontaneously are created from great teams. Great cultures do not create great products and companies, but they will increase the probability and reduce the risk of mediocrity. Building a conscious culture requires building an intentional strategy. Successful businesses without conscious cultures are fragile businesses.

4. Fallacy: We won’t have a company if we don’t focus on the revenue and go to market strategy first. We cannot afford the time and resources to focus on culture. We will get to it later, though — promise.

Truth: Building a great culture requires the same vision as seeing a finished product far before development is complete. Investing in the operations of people processes and ensuring executives and teams are equipped with what they need to work effectively is hard work; but it is work that, when done right, will increase company value.

5. Fallacy: Perks can create good culture.

Reality: This is a lazy person’s approach to culture and often, a waste of resources. Employees do not care about the free beer as much as they care about clear expectations and a personal growth path.

6. Fallacy: HR manages culture.

Truth: There is a chasm in how a culture is spoken and how it is experienced. Any one department, especially HR, is unlikely to have leverage over any one company’s culture. Great leaders know that the entire leadership team must collaborate to operationalize culture. Everyone in the company is responsible for, and has a role in, exemplifying and sustaining it.

I believe that:

Great cultures can be intentionally created in a practical, simple, and realistic way.

Leaders must be accountable for exemplifying what is expected from others. And when they do not, we cannot be afraid to speak the truth

A great culture demands an intentional strategy that needs to be driven and practiced from the top down and then understood and practiced from the bottom up.

In a moment when we hear stories about toxic cultures and tolerations of bad behavior, we all become accountable. We all must recognize that we have both the power and, increasingly the obligation, to speak and act toward a better way.