Culture Wins

1. Culture Wins: It's the Ultimate Differentiator

Culture trumps your business idea. Culture trumps your strategic plan. Culture even trumps the competency of your team.

More than strategy. In today's business landscape, culture is the ultimate competitive advantage. It surpasses the importance of a brilliant business idea, a well-crafted strategic plan, and even the individual skills of team members. A strong, positive culture fosters collaboration, innovation, and employee engagement, leading to greater success.

Culture eats strategy. Peter Drucker's famous quote, "Culture eats strategy for breakfast," highlights the power of culture. A talented team with a great strategy can fail if the culture is toxic. Conversely, a team with a strong, healthy culture can overcome challenges and achieve great things, even with a less-than-perfect strategy.

Culture is the glue. Culture is the glue that holds a company together, especially during times of change. In an era of rapid technological advancements and evolving business models, a strong culture provides stability and helps employees adapt to new challenges. It is the foundation upon which a successful and sustainable business is built.

2. Know Your "Why": Purpose Drives Culture

Thinking about culture starts with figuring out why you’re doing something.

Purpose before values. Before defining cultural values, a company must first define its purpose. What is the reason behind its existence? What does it bring to the world? If the company disappeared tomorrow, would it matter? This "why" serves as the foundation for a strong and authentic culture.

HubSpot's example. Companies like HubSpot understand the importance of purpose. Their employees know they are not just coders or IT specialists; they are changing the way sales and marketing are done and ending cold-calling. This shared purpose creates a strong and palpable culture.

Communicate the "why." CEOs must clearly communicate the company's "why" throughout the organization. If you ask an employee why they are there, doing what they are doing, what would the answer be? The message has to be clearly communicated throughout the ranks before you can start working on your culture.

3. Define "Your Kind of Crazy": Embrace Uniqueness

When we’re functioning at our very best, what do we do that’s common to our organization but uncommon in traditional companies?

What makes you different? To define a company's culture, it's essential to identify what makes it unique. What are the behaviors, customs, and mannerisms that are common to the team but uncommon to other teams? This "kind of crazy" is what sets the company apart and attracts like-minded individuals.

Vanderbloemen's values. At Vanderbloemen Search Group, "ridiculous responsiveness" and "wow-making excellence" are two examples of values that define their unique culture. These values are not generic; they are specific, memorable, and reflect the company's commitment to exceptional service.

North Point Ministries. North Point Ministries took a whole year to go through the process of sending out surveys, bringing leaders together to look at the responses, and collaborating to determine the church’s values. Questions and comments went up and down the pipeline between the employees, management, and senior leadership. For a church that size, that’s exactly how it needed to be done.

4. Culture Starts at the Top: Leadership Sets the Tone

If the people at the top don’t embody a healthy culture, your people won’t trust them, and your mission and vision statements will be irrelevant.

Lead by example. A company's culture starts with its leadership. If the leaders don't embody the values they espouse, the culture will be hollow and ineffective. Employees will emulate the behavior of their leaders, so it's crucial for leaders to "walk the talk."

Transparency builds trust. Transparency is essential for building trust between leaders and employees. Just as Heinz used transparent packaging to build trust with its customers, leaders must be transparent with their employees, sharing information and being open about the company's challenges and successes.

Look at the top five. The easiest way to figure out a company’s culture is by looking at the top five people in the organization. Do they follow a basic code of human decency and treat others the same way they want to be treated? Do they like their job? If you’re not seeing it at the top, then there’s a problem.

5. Combat Culture Leaks: Proactive Maintenance is Key

As you add people to your team, you’re increasing the chances of leaks, and perhaps adding to the number of leaks you already have.

Culture leaks defined. A culture leak occurs when someone behaves in a way that contradicts the values of a company. These leaks can be subtle, but if left unchecked, they can erode the foundation of the culture and lead to significant problems.

Formalize culture-enhancing activities. One way to maintain culture is by formalizing culture-enhancing activities. Define a budget and create a cultural calendar. Unless you commit more time and resources to your culture, there is no guarantee it will remain intact.

HubSpot's approach. HubSpot realized it needed to really work on its culture during the time leading up to its initial public offering (IPO). They foresaw an inevitable disruption and potential culture leak and took action to prevent it. When your company is growing and you get to a new level of compensation and size, people will be tempted to leave, but culture can be one of the main reasons they decide to stay.

6. Hire for Culture: Fit Over Skills

No matter how competent people are, if they don’t fit our culture, they will end up hurting our company.

Character, competency, chemistry, culture. When hiring, prioritize character, competency, chemistry, and culture. Character and a natural inclination to follow the Golden Rule are basic to someone’s ability to adopt the kind of culture you’re probably trying to cultivate in your workplace. Hire people who are trustworthy. Then look for people who are a strong culture fit. Most of the time, competencies can be taught but culture cannot.

Avoid surprises. Being upfront about your company’s culture can prevent you from making mistakes. For example, a highly talented young man applied for a controller position at my company. He had all the right skills on his résumé, but we did a good enough job explaining our kind of crazy to him on the front end that he was able to recognize he wasn’t a good fit for our team.

The most expensive hire. The most expensive hire you will ever make is hiring the wrong person. If you don’t assess people’s ability to fit your culture, it doesn’t matter how wonderful their résumés look or how competent they are; sooner or later, they will become cancerous to your team.

7. Onboard for Culture: Infuse Values from Day One

Organizations with a standard onboarding process experience 54 percent greater new hire productivity and 50 percent greater new hire retention.

Culture before day one. The cultural initiation into a company should begin even before the new employee's first day. At Vanderbloemen Search Group, new hires are required to complete a course on financial responsibility before they start, demonstrating their commitment to the company's values.

The culture funnel. The culture funnel is a system that delivers a massive cultural infusion from the get-go. Much like a sales funnel, it simultaneously educates and engages people so they feel more informed about, and comfortable with, our company.

Personality tests. Personality tests can be a valuable tool for onboarding, helping new hires understand their communication styles and how to best interact with their colleagues. However, these tests should not be used to make hiring decisions.

8. Live the Culture: It's a Lifestyle, Not a Task

Culture is working when employees say, “This is how our framily functions.”

Ownership of culture. Culture is working when employees take ownership of it, referring to the company as "we" rather than "they." This sense of ownership fosters a strong sense of community and shared purpose.

Core value spotlight. At every Ritz-Carlton shift change, every single day—and it doesn’t matter whether the shift change is happening in the kitchen with the sous-chef and pastry chef, or it’s the beginning of the CEO’s or CFO’s day—the small teams of people who work directly together have a daily huddle. These are ten-minute, stand-up meetings where they take time to recognize each other as people and say, “Hey, it’s Sarah’s birthday” or, “It’s Ben’s work anniversary.” Then they have a Gold Standard spotlight.

Nonwork time. Google requires managers to spend 15 percent of their time with their people outside of the workplace. Managers are encouraged to take people to lunch and have activities outside the office with their teams.

9. The Culture Whip: A Dedicated Guardian

Culture matters enough to put a focus here. In fact, it matters enough to put personnel dollars here.

Dedicated role. To ensure that culture is a priority, it's essential to have a dedicated person responsible for driving and guarding it. This "culture whip" is responsible for planning events, communicating values, and ensuring that the culture permeates everything the company does.

Close to the ground. The culture whip needs to be close to what’s going on. That person needs to be close to what’s going on. Someone who’s in the trenches is going to have a better sense of what works and doesn’t work for a culture.

Budget for culture. If you don’t make it someone’s job to drive the culture, it won’t happen. You can’t expect people to volunteer their time on top of all their other job responsibilities, and if you expect people to do it in their free time, you will have a very long wait. People are busy. If you’re serious about building and maintaining a strong company culture, I strongly advise you to create a position for it.

10. Tie Compensation to Culture: Reward Values

If you compensate people based solely on hitting their sales numbers or other goals, you’re encouraging bad behavior.

Beyond performance. Compensating employees solely based on performance can incentivize unethical behavior and undermine the company's values. It's essential to tie compensation to culture, rewarding employees who embody the company's values and contribute to a positive work environment.

Cultural scoreboard. At Vanderbloemen Search Group, bonuses are based on company growth, team performance, individual goals, and a "cultural scoreboard." This ensures that employees are not only achieving results but also living out the company's values.

Culture trumps performance. Culture trumps performance. You can sometimes fake performance, but you can’t fake culture, at least not for more than a couple of weeks. Sooner or later—usually sooner—culture is exposed, and it reflects who you really are. It’s a direct extension of who you are, and company culture is a direct extension of what the company does.

11. Cultural Endings: Graceful Exits

The most common piece of advice I’ve given people is, “Hire slowly, fire quickly.”

Firing is never easy. Ending someone’s relationship with your company affects his or her family, future, self-confidence, and much more. Such a decision should be weighed considerably. Sometimes there’s a significant problem and the determination to let the person go is easy, but the actual firing process never is.

Be clear about the problem. When someone on your team is just getting by, but the work is not so subpar to warrant firing, the first question to ask yourself is, “How is the person doing on company culture?” If there’s a cultural red flag, be clear about the problem and your intentions.

Protect the culture. If people don’t improve and you have to let them go, be clear about the reason, too: You are protecting the culture of the company.

12. Agility is Key: Adapt to Change

If you aren’t agile, you’ll be left behind.

Constant change. In today's rapidly evolving business landscape, agility is essential for survival. Companies must be able to adapt to new technologies, changing market conditions, and evolving employee expectations.

Culture must bend. While the core values of a company should remain constant, the way those values are expressed and lived out may need to evolve over time. A rigid culture that is unable to adapt will eventually become irrelevant.

Agility in action. Agility—being able to pivot, move, and shift with the rapid changes—will allow your culture to bend, swerve, and survive. If you aren’t agile, you’ll be left behind.

Last updated: February 26, 2025