Why your business practices are the most important thing you’re not paying attention to

One of the biggest challenges leaders and teams struggle with is how to translate their organisational strategy and values into the day-to-day decisions and experiences of their business.

A lot of energy and attention can be spent creating a strategy, responding to the market and customers, and building a product or service. But how all of these ambitions are executed in reality — the culture a company has — is just as important. An organisation’s culture is really what determines what gets created and the impact a company has on their customers and stakeholders.

Culture and strategy are the double helix of any functional organisation’s DNA.

After years of helping start-ups and scale-ups turn their ambitions into action as Consequential, we’ve found that the most overlooked but crucial way to guide the execution of a strategy and make a desired culture explicit is to intentionally design business practices.

In the course of doing business, people are constantly designing how they meet to achieve their objectives. A company’s operations are made up of a series of practices which are used every day in how teams work together, make decisions, and create and deliver products and services — from project management to financial auditing. But

There hasn’t been much exploration of business practices and their importance to how an organisation works and succeeds. It can be hard to even define what a business practice is — often they’re talked about in terms of ‘best practice’ or a set of nebulous, collective behaviours and processes.

At Consequential, we’ve spent the last year looking at business practices — giving them definition, breaking them down into tangible components, and helping leaders and teams to use them as important levers for achieving their goals.

Consequential’s definition of a business practice: any formal, recurrent interaction within a company that has the purpose of making decisions or completing tasks.

A business practice can be with other members of the company or with people external to the company, like customers or investors. To break down our definition, we use the word ‘formal’, as we see business practices as self-contained events in which people are interacting together following an agenda, even if a loosely defined one. In simple language, a business practice is a meeting where there is advanced notice, is a set period of time, and has a purpose everyone involved is aware of. They are called business ‘practices’ because like anything else that needs to be done well, they need to be done more than once — which is why practices are not any meeting, but the interactions that occur regularly. The shorthand for this would be interactions that have names everyone knows — sprint planning, a performance review, a board meeting.

Business practices can be ‘planned’, which means they happen as part of daily operations, or they can be ‘reactive’, in response to events. Practices that are planned can happen consistently as part of the regular fabric of working at an organisation — like a daily stand up or a weekly team meeting; or they can happen as part of a regular cycle — like a project kick-off meeting which happens every time a new project is started. Practices can be about making important strategic decisions — like reviewing candidates for a job, or whether to launch a product. Or they can be operational, about completing tasks, exchanging information, or determining how to work together — like creating a pitch deck, reviewing a project status, or a team away day.

An organisation’s practices are what people most tangibly experience about that business, and are where its culture and values are most evident.

As business practices happen consistently and are the place where collective decisions and work are done, how they are designed and who participates creates shared and codified habits within a company. Collectively, the way an organisation supports the interactions of its people and its customers is the way it practices its values — for example, an organisation that has a practice of everyone deciding the next project shows they value collaboration. So while there may be standard practices within sectors or types of businesses, the experience of them will always be unique to an organisation and its people.

Intentionally aligning desired organisational values with the way teams interact is a powerful business driver for any company.

Which is why focusing on designing specific business practices is the necessary next step after creating a strategy and organisational values; it’s the best way to effectively and tangibly operationalise them throughout the company.

Consequential has created a 3 step process to design business practices, allowing leaders and teams to align their practices with their values — making those values explicit and concrete. By methodically and intentionally designing their practices, organisations can ensure they create the best products, attract the best talent, quickly scale up their operations in a cohesive and aligned way, and stay competitive.

Focusing on intentionally designing practices can be the quickest way to support cultural change and create an aligned and value-led organisation that moves at scale.

We’ve looked at the core components of a business practice and broken them down into a series of questions that can help leaders and teams design the practice in line with their desired values and strategy.

We’re also aware it can be hard to know where to start to create change quickly, so we’ve done some thinking on how to help organisations discover which practices are business critical for them. This is about identifying which practices would have the highest impact on their strategy and objectives, and the culture they want to create.

Below are some examples of different business critical practices a product-based scale-up company may have:

We’ve recently teamed up with Nathan Coulson while working together at the Digital Catapult’s Machine Intelligence Garage. Our ambition is to turn our 3 step process into an interactive, white label tool that businesses can use to help teams design their practices in line with the values of the organisation. The tool we’re designing will allow an organisation to set the values and priorities they want to see, while allowing teams to design their own practices in ways that are most effective for them.

With this distributed approach to making practices explicit and co-created, you can create organisations that are inclusive by design. Being proactive about designing practices can stop bad behaviours from festering and build the habits and culture an organisation wants to have. In this way, the whole organisation can move quicker, build capacity, and be more productive while going in the intended direction.

Our interest in breaking down and designing business practices comes from our passion for the seemingly boring and minute parts of business, because we believe that’s where the most change comes from.

We hope this focus on business practice design is a new way to help organisations align the positive impact they want to have with the reality of the decisions they make everyday trying to get there.

If intentionally designing value-aligned business practices sounds interesting to you, get in touch!