Organizational culture and a better bottom line: Putting the horse before the cart

by Gale Martin, Director of Marketing, S. Dale High Center for Family Business

Is everyone in your family business
contributing to the bottom line?

Our breakfast seminar presenter on March 17, Sam Davis of The Davis Group, has an important message for family business leaders:

Want better performance? A stronger bottom line? More operational efficiency? Put the horse BEFORE the cart. Pay close attention to your organizational culture! 

Culture and performance are inextricably interwoven. Yet, the relationship is complicated. Just how can executives to capitalize on this relationship.

Defining culture in a business organization
Organizational culture includes group behaviors, styles of interaction, and perceived attitudes towards customers, co-workers, vendors, and shareholders. Organizational culture is tied to common values--whatever a company's values might be (positive or negative; weak or strong). You yourself may have observed the culture of an organization if you found a company to comprise hardworking, friendly, professional, and/or ethical employees. Hostile, lazy, unethical employees are products of organizational culture, too--don't forget.

Culture is powerful. It influences the priorities set by the organization. If a company has a reputation for being customer focused, innovative, efficient, economical, forming strong alliances, and empowering employees, it's because those values were "driven into the shop floor."

How to shape your organizational culture
Culture building starts at the top. Perhaps a company's culture reflects the values of the founding generation. It takes time and energy to perpetuate that same set of values across multiple generations. But if done effectively and consistently, over time companies develop ways of conducting business and treating employees. Think behavioral science. What you encourage, what you reward, are the behaviors that continue. So, you need to pay attention to the culture you're creating in your family business. Step back and observe whether you are encouraging a climate that compliments or countermands the values on which the family business was founded.

The power of a strong business culture
A strong, positive company culture enables employees to better align their goals with business goals and can motivate them to higher levels of performance. Shared values make people feel good about the places where they work. A strong company culture can create a climate of empowerment, decisiveness, learning attitude, and team work.

Those who have worked hard to drive their values into their business know that a strong organizational culture is the real driver for superior performance and a source of competitive advantage that competitors will be hard-pressed to emulate.

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Sam Davis, The Davis Group

If you want to learn more about the relationship between your company culture and your bottom line, then plan on attending "Your Values and Your Bottom Line," the next breakfast seminar offered by the S. Dale High Center for Family Business, on March 17 at Elizabethtown College.