In this post, we’ll explain all you need to know about business culture, defining exactly what it is, why culture is king, how to create a successful culture and more.
What Is Culture?
Culture is the DNA of a business based around a set of beliefs and values that people consistently follow. It is a business’ identity that serves as an internal compass, guiding the behaviour of everyone connected.
Thus, everything your business does is an extension of your culture, beginning with how you treat your employees and ending with how you treat your customers.
Why Culture Is King
Culture is the single most powerful force driving your business’ performance and your only truly sustainable competitive advantage.
Culture shapes the attitudes and behaviours of both its employees internally and its customers externally. Anyone can copy your products. Anyone can copy your systems. No-one can copy your culture because it is the very fabric and heartbeat of who you are and what you stand for.
We see the impact of culture in all areas of life, from successful sports teams to thriving families. However, culture is no more prevalent and important than inside successful businesses. In fact, according to a Harvard study of over two hundred companys, a strong culture increases net income by an extraordinary 765% over a ten-year period.
How To Create A Highly Successful Culture
In his book The Culture Code, Daniel Coyle reveals how, through his research, he identified three universal skills that are necessary to create a highly successful culture which tap into the power of our social instincts. They are: Build Safety, Share Vulnerability and Establish Purpose. These three skills work like a hierarchy, each one building on top of the other.
Safety communicates the message “We are safely connected here.” Vulnerability communicates the message “We share risk here.” Purpose communicates the message “We know which direction to move here.” Therefore, three characteristics that summarise the ultimate in group performance are cohesiveness, cooperativeness and agility.
Below we’ll unpack each of the skills in more detail.
1) Build Safety
Safety is the basic foundation on which a highly successful culture is built upon.
As far as our brain is concerned, rejection equals death. Why? Because for our ancient ancestors, rejection from a group meant isolation and isolation ultimately meant death. In order to overcome this biological survival mechanism, the most successful companys install a feeling of safety by consistently incorporating what are known as belonging cues.
Belonging cues are behaviours that initiate safe connection. Their function is to answer the ancient ever-present question glowing in our brains: Am I safe here? Belonging cues include proximity, eye contact, turn taking, attention, body language, tone of voice and whether everyone talks to everyone else in the group. These cues convey a single message: You are safe here.
As Daniel Coyle explains, building safety “is about dialling in to small, subtle moments and delivering targeted signals at key points.”
To build safety, Coyle recommends the following:
- Overcommunicate listening.
- Communicate your fallibility.
- Embrace negative feedback.
- Overdo thank-yous.
- Hire diligently.
- Zero tolerance for bad behaviour.
- Create safe, interaction-rich spaces.
- Ensure everyone has a voice.
- Embrace fun.
Once you have created a sense of connection and belonging through building safety you must share vulnerability.
2) Share Vulnerability
Vulnerability is what a highly successful culture uses to translate connections into trust and cooperation.
Our brains are constantly scanning our environment and calculating whether we can trust and bond with the people around us. What determines whether we can trust someone is vulnerability.
Trusting cooperation is created via what Coyle refers to as a ‘vulnerability loop’ which he describes as ‘a shared exchange of openness’. Vulnerability loops follow the same five steps:
- Person A sends a signal of vulnerability.
- Person B detects the signal.
- Person B responds by signalling their own vulnerability.
- Person A detects the signal.
- A norm is established and connection and trust increase.
Exchanges of vulnerability, which most people tend to avoid, are the pathway through which trusting cooperation is built.
To encourage vulnerability, Coyle recommends the following:
- Make sure leaders are vulnerable first and often.
- Overcommunicate expectations.
- Deliver negative news face-to-face.
- Embrace discomfort.
- Encourage participation.
Once you have created a sense of trust and cooperation through vulnerability you must establish your purpose.
3) Establish Purpose
Purpose is what a highly successful culture uses to drive everyone’s focus towards a shared vision.
Highly successful cultures establish their purpose through relentlessly seeking ways to tell their story by creating what he refers to as high-purpose environments. High-purpose environments are filled with signals designed to create a link between the present reality and a future vision. They provide two simple messages: This is where we are and This is where we’re going. Stories, as Coyle puts it, “…are not just stories; they are the best invention ever created for delivering mental models that drive behaviour.”
Highly successful cultures focus on creating values, naming keystone behaviours and then flooding the environment with heuristics that link the two. More simply, purpose is created by generating a clear set of signals that link A) Where we are now to B) Where we want to be. Each heuristic functions as a small narrative that provides a vivid mental model for solving problems. Creating behaviour around a clear and simple set of values functions as a lighthouse, orienting behaviour and providing a path towards a shared vision.
To establish purpose, Coyle recommends the following:
- Identify and overcommunicate your mission.
- Identify, rank and overcommunicate your values.
- Share compelling stories.
- Build ownership.
- Use catchphrases and artefacts.
- Measure what really matters.
- Focus on bar-setting behaviours.
- Improve creative processes.
Culture is the identity of a business created by a set of beliefs and values that shape the behaviour of everyone connected. The secret to building a successful culture involves three skills: Building Safety, Sharing Vulnerability and Establishing Purpose.
Firstly, flooding the environment with signals of safety creates a sense of belonging and connection. Secondly, flooding the environment with signals of vulnerability creates a sense of trust and cooperation. Lastly, flooding the environment with signals of purpose creates direction and movement.
Seen through this lens, culture is ultimately about signalling because the human brain is incredibly acute at perceiving signals based on whether or not we are safe, whether or not we are being vulnerable and whether or not we are moving in the same direction. Therefore, when you improve your signals, you improve your culture.