Culture by Design: Patagonia’s Blueprint for Saving the Planet
Introduction
In 2022, the outdoor apparel retailer Patagonia made headlines when its founder, Yvon Chouinard, committed all of the company’s profits toward fighting the climate crisis under the belief that the “Earth is now our only shareholder.” Many organizations claim to be stewards of the Earth, but few have committed to their mission in the way that Patagonia wholly did and found success from it. Today, Patagonia is worth $3 billion and has risen to the top of the sustainable retail industry. What makes them successful, given the odds of a profit-driven world? How do they live up to their purpose?
Many attribute Patagonia’s success story to their principled leadership and the values that are imbued in their company culture from the production of their clothing to their narrative around regenerative clothing. The Stanford d.school believes that culture is “a living system that defines how people work together toward accomplishing collective goals.” There are visible forces — artifacts, behaviors, and metrics — and invisible forces — beliefs, values, and assumptions — that are constantly interacting.
The visible forces of culture are easier to change, while the invisible ones are harder to change. That’s where cultural interventions come in — these are designed to shift the visible parts to change the invisible.
What kind of rituals drive success in purpose-driven companies? What stories do leaders tell to their company to develop a shared culture? How do you scale this culture as the company grows?
This article will aim to answer these questions through a case study of Patagonia — how the company’s values manifest themselves in various steps of the employee journey and how they instill their core beliefs into their employees at different levels of management.
Patagonia’s Origins & Values
Born out of Yvon’s love for rock-climbing, Yvon’s business started by making products for the mountaineering community. He and his team experimented with climbing hardware that would not damage the rocks and fabrics that could provide quick-drying insulation in frigid conditions. By investing in the specific needs of the outdoor community and building a loyal customer base, the company’s sales skyrocketed.
Yet, their rapid growth came to a halt in 1991 due to the recession, and the company was forced to lay off 20 percent of its workforce. This was a turning point for Yvon and the executive team to reflect on their mission and values. In his book Let My People Go Surfing, Yvon describes the culture they kept alive despite the challenging times — culture which was fueled by the spirit of the outdoor community that many of their employees came from.
Employees went running or surfing during lunch breaks, and played beach volleyball in the sandpit behind the office building. Rather than cubicle-style seating, the office spaces were designed with few physical barriers to promote open collaboration. During the weekends, coworkers would also go on company-sponsored ski and climbing trips. Malinda Chouinard started an on-site childcare program, taking the burden off of working parents to find babysitters and creating a familial, rather than corporate, environment at work.
By taking care of their employees first and fostering a team-oriented work culture, employees can dedicate themselves to Patagonia’s mission, united by a common purpose: “We’re in the business to save our home planet.” To achieve this mission, Patagonia has five core values (these are taken directly from the website with parts redacted or rephrased for brevity):
Quality: Build the best product with the least harm, giving back to the Earth as much as it takes. The best product is useful, versatile, long-lasting, repairable and recyclable.
Integrity: Examine our practices openly and honestly, learn from our mistakes and meet our commitments. We value integrity in both senses: that our actions match our words, and that all of our work contributes to a functional whole.
Environmentalism: Protect our home planet. We work to reduce our impact, share solutions and embrace regenerative practices. We partner with grassroots organizations and frontline communities to restore lands, air and waters to a state of health.
Justice: We embrace the work necessary to create equity for historically marginalized people and reorder the priorities of an economic system that values short-term expansion over human well-being and thriving communities.
Not bound by convention: Do it our way. Our success — and much of the fun — lies in developing new ways to do things.
Case Study
The objectives of this case study are:
- To identify existing patterns and cultural practices in Patagonia
- To examine culture programming in Patagonia and assess its strengths and weaknesses
- To develop recommendations for improving the culture of Patagonia and other like-minded organizations who are looking for working models to replicate
Part 1: Methods
The information that I gathered for this study are from a combination of both primary and secondary sources. I conducted one in-person interview with the team lead at the Patagonia store in Palo Alto and one virtual interview with the Chief People and Culture Officer of Patagonia. During these interviews, I asked the following questions:
- How would you describe the culture of Patagonia?
- What are some examples of culture-defining practices in the hiring process, office spaces, team collaboration norms, etc?
- What are “levers of change” that you can pull to shape culture?
- How do you scale culture across a company the size of Patagonia?
- Who are your “culture carriers” and how do you hold them accountable?
I did a field study in their Palo Alto store where I observed employee behaviors and documented artifacts and spaces. Additionally, I did research online of past interviews conducted with the founder and the previous CPO.
After the discovery phase, I synthesized the findings by taking my interview notes, observations, and readings, and dividing them into common themes, which I outline in the following section. From there, I analyzed the results based on their strengths and weaknesses to determine opportunities for improving the culture of Patagonia.
Part 2: Findings
1. Hiring people who are a “culture add” as opposed to a “culture fit”
Patagonia shapes their culture through the people they hire. Dean Carter, Chief HR Officer of Patagonia from 2015 to 2022, championed a method of reading resumes from the bottom-up, instead of top-down, to understand the candidate’s hobbies and interests outside of work first; they ultimately want to hire people who are equally passionate about the outdoors.
When I spoke to the Palo Alto store leader, he reaffirmed that many Patagonians have shared interests outside of work related to the outdoors such as hiking, rock-climbing, and skiing and feel passionately for the planet. By searching for these common values from the get-go, Patagonia ensures that new hires aren’t just in it for self-interest, but they share a common interest in making planet Earth a better place.
However, Patagonia doesn’t believe in a simple “culture fit,” but rather seeks to find a “culture add.” This means they’re hiring people for the whole human being they are and the personal stories they carry with them, not just their work experience and skillset. The current Chief People & Culture officer of Patagonia leaned into this in my interview with her saying that “stories and communities are a big part of the culture here… we want to create a richer and more expansive story.”
2. Supporting and understanding employees holistically
Treating employees as human beings means providing for them holistically. Speaking with the Palo Alto store leader, he shared: “we’re in the business to save our home planet. But you can’t focus on saving the planet if you’re worried about providing for yourself first.” That’s why an important implication of this ambitious goal is that the company provides many employee benefits including health coverage that is more comprehensive than most other companies, which alleviates one’s personal financial burdens.
Moreover, Patagonia was one of the first companies to have an on-site childcare center for working parents. This is the visible lever that the company pulled, which drives the invisible norms around the corporate environment. The company writes: “The presence of children playing in the yard or having lunch with their parents in the cafeteria helps keep the company atmosphere more familial than corporate.” By taking care of their employees’ needs, Patagonians can focus their time and energy on the mission, in the presence of people who care for them.
The Palo Alto’s retail team also performs a daily ritual that helps them care for each other: during each morning stand-up, they share a point of gratitude, a goal, and a blocker. This is similar to a rose-bud-thorn exercise. The store leader says that this ritual is very humanizing because “people experience good and bad days,” but they can work better together when they know what’s going on.
The People & Culture team also performs a ritual called one-community hour, where they come together each month to discuss a topic. For example, in March, they focused on Women’s History Month and were able to share personal experiences and stories of women who inspire them. The visible practice breeds a space for openness and vulnerability, which has invisible effects on how the team understands and supports each other.
3. Fostering a culture of co-creation through joint decision-making
Another aspect that is “bottom-up” rather than “top-down” is the way that the company makes decisions. Every year, each store commits 1% of their sales (regardless of profit) in grants to local grassroots organizations. Each store also gets to independently decide which non-profits they want to donate to. They even put out a small bucket in the store to collect recommendations from customers.
This places a lot of agency in each store to create their decision-making process. For the Palo Alto store, everyone fills out a rubric based on a number of criteria to help each person think about how the non-profit fits with their company values, and then they open the floor for discussion. The decision is usually made by reaching a consensus; this democratic format gives agency to each individual regardless of their seniority.
In addition, each store determines how they want to use their Previously Used Products, or PUPs, worn products that customers give back to the store. The Patagonia store in Palo Alto teamed up with the store in New York to donate the extra clothes to the humanitarian crisis in Gaza. By opening up gray areas for each store to make decisions, it empowers everyone to be involved in the mission of saving planet Earth. The bottom-up nature of decision-making also levels the playing field for all employees to participate equally.
Another way that Patagonia fosters an open and leveled culture of collaboration is how they architect their physical office spaces. The office features open spaces with few physical barriers. The Chief People & Culture Officer says that this eradicates any sense of hierarchy or status between coworkers, which reinforces that they are working together towards a common goal.
4. Engaging and educating the community through grassroots efforts
Finally, Patagonia puts a lot of effort into engaging with the community through education. When grant season comes around, they will invite nonprofits in the local community to table in the store and raise awareness for their cause. For example, the Wild Oyster project recently had a tabling event in the Palo Alto store for people to learn about the impact of oysters in restoring the ocean’s ecosystem.
Moreover, there are many events that invite the community to join in the effort to save planet Earth such as a beach clean-up at Half Moon Bay, which was advertised on their chalkboard.
Throughout the store, there are also infographics around the products, such as the one pictured below, that educate the customer on the origins of the material and their sourcing practices.
Each Patagonia also has a repair station for people to fix their clothes; by encouraging people to repair their clothes, whether that be a broken zipper or patching a hole, it reduces waste and natural resources involved in producing new clothes.
Part 3: Analysis
In an organization, drivers and inhibitors push and pull at an equilibrium, which produces a certain kind of culture in the company. Some examples of driving forces are motivation, incentives, and goals. Some examples of inhibiting forces are limited resources, fear, and lack of job security. Rituals are able to disrupt this equilibrium by amplifying drivers or reducing inhibitors.
Patagonia’s rituals aim to disrupt the equilibrium by giving their employees safety and security in their job through tangible practices like superior healthcare benefits and onsite daycare services. This fosters a self which can focus on enjoying their job and finding meaning in the work that they do. Each team I interviewed also has their own practices of caring for one another whether that be through a morning stand-up or monthly community time to discuss things outside of their immediate work. This paints a picture of the employee as a holistic human being and gives people an understanding of each other outside of their job title.
Furthermore, rituals such as annual meetings to decide on the grantees allow the employees to co-create policy and reduce the sense of hierarchy, an inhibitor that could stifle individual creativity. This decentralization of power gives agency to the individual without the need for top-down management, and it allows individuals to take ownership of their decisions so that everyone can play a role in advancing the mission.
Lastly, the physical spaces invite people to collaborate. Architected environments like open office spaces reduce physical (and invisible) barriers between people so that they can communicate freely. The use of chalkboards as mutable surfaces throughout the store allows the staff to get creative, customize messages, update content regularly so there is novelty every time customers visit the store. These chalkboards and stations make the retail store space highly interactive, inviting the customer to join in their cause.
Recommendations
From my analysis, there are a number of lessons that like-minded organizations can learn from Patagonia’s culture model. First, start from the individual. People are the heart of the company, and Patagonia shows that investing in the happiness and wellbeing of employees — building an onsite daycare to help working parents and paying for better healthcare — pays off in the long-run. Another part of caring for employees is giving them space to discuss things outside of work through rose-bud-thorn or topic-based activities. Work is only one part of a person; there are many other parts such as one’s hobbies, challenges, and passions.
Second, create more gray areas for others to fill in the blank. As a company expands and develops sub-teams, executive management shouldn’t need to be involved in every decision nor define how each team should operate. Instead, they could leave intentional spaces of ambiguity to empower each team to make decisions and do their part in advancing the mission. Finally, explore creative uses of physical space. Removing physical barriers between people can dramatically increase collaboration. Temporal surfaces like whiteboards or chalkboards are a low-cost, high-value way to provide purpose-driven messaging to customers.
Although Patagonia is an exemplar of well-designed organizational culture, they also have opportunities to lean into parts of the employee journey such as the onboarding step. Currently, employees undergo a standard process where they watch required videos and read about the history and mission of the company. Since Patagonia focuses heavily on creating an environment that feels like a family, they could have a ritual of celebrating someone’s first day with cake like celebrating a birthday and they could also have visible artifacts — like leaves on a tree — to symbolize the number of years they’ve been at Patagonia, similar to the Lego blocks that Notion employees have. Teams can also celebrate these anniversaries together.
Parts of Patagonia’s culture are produced organically so there are a number of rituals unique to each team. But, what if the manager is not self-motivated? How could we “activate” those teams? One ritual to help motivate teams is to give employees physical or digital badges, similar to Trailblazer ranks in Salesforce, for completing “culture goals.” Examples of these could be “going on a hike with a coworker” and “giving a PUP (Previously Used Product) away to someone in need.” When they complete each goal, they can post a photo or message of how they completed the goal that everyone else in the company can view. This promotes sharing of rituals between teams, which can inspire others who are not as self-motivated. Collecting badges as a token also leans into Patagonians’ innate sense of adventure and love for exploring the outdoors.
Conclusion
From Patagonia, we see an example of culture design done early and done right, so much so that the culture from 30 years ago still persists to this day. Here are a few key takeaways from this case study:
- Hire people who believe the mission and care for them like they’re your own family — this allows mission-driven people thrive and use their energy towards positive change
- Embrace the “gray areas” that give teams and individuals autonomy to make decisions that contribute to the mission
- Think about how people interact with physical space and objects — get creative with what you have in the office space to create touchpoints for co-creation
At the end of the day, if you’re on a mission to save planet Earth, it comes with making ambitious culture plays. Patagonia created a culture for themselves that has weathered storms and from leadership to retail staff, they continue to place a heavy emphasis on designing culture that is aligned with their common goal.
