Part 4 in the video series. Subscribe for email alerts when more videos are posted.
More from this series:
Creating Corporate Culture – Part 1
Creating Corporate Culture – Part 2
Creating Corporate Culture – Part 3
John Assaraf sat down with Steven Cox, CEO of TakeLessons.com, to discuss what it means to create and maintain a thriving corporate culture. In this interview, Cox defines corporate culture, outlines steps entrepreneurs can take to define their company’s culture and shows how a strong culture can translate into other great gains for any organization.
Assaraf: As Steven was talking, I was thinking of Barbra Streisand’s song, “People who need people are the luckiest people in the world.”
Cox: John’s been taking voice lessons with us.
A: No I have not! I’m just trying to make you laugh a little bit. So let me ask you all a question so we can get a little feedback loop going. Do you all agree that it’s all about people, it’s all about making a difference? Making a profit is good, but the number one focus is creating a culture and company with people who love and value what you value as well.
Kristen, what’s some feedback from our group here?
Kristen: They’re all agreeing with what you said. Business should be more about the people. We don’t have any questions as of yet. I assume we’ll get some.
Great, let’s keep going.
C: Sometimes I’m asked, this seems like a lot of soft, feel-good stuff, how do you balance the necessity to produce profit with focusing on people and producing a culture that people want to be a part of. I’m a finance guy by trade and that’s what I studied in school so I want to give you some data, not from me, it’s actually from people a lot smarter than me, that backs up what we’re talking about and what we’re saying here.
Two professors from a little university called Harvard, which you’ve probably heard of, have completed an 11 year study on the effects of how people are using culture within public companies. These aren’t private companies; you can actually get results and know what the financials and what the revenue growth of these corporations are. They divided companies into a weak culture group, where the value of culture has not been emphasized whatsoever, it’s kind of just roughshod, do whatever you want. Then there’s a strong culture, and there’s four main divisions along the way. So they took a look at the bottom percentage with a weak culture and then they looked at companies with a strong emphasis on culture. They were completely blown away by the differences between those types of corporations. The companies with a strong emphasis on culture had expanded their workforce by fivefold of the people with weak culture. More important, or just as important, the revenue growth was exponential and the stock price was 900%. It’s unbelievable. And yes, there are other factors probably associated with this, but this is a data point that without a doubt makes a huge, huge difference.
The bottom line is that if you can get the alignment of your people with your mission and your vision and your values, you create a force, a force that’s unstoppable because you’re all marching in the same direction. Whether that is two people, four people, 400, 4,000, the rules are still consistent. Culture helps everyone get on the same page and march in the same direction.
Another study, there’s a group called Dennison Consulting, they’re based out of Canada as well as in Switzerland, and they’ve also completed many many studies on this and they look at financial data. Companies that have focused more on their culture and developing out with clear indicators of what we stand for versus companies that have no indications of these, and this isn’t just something they hang on a wall and say “these are our corporate values”. Enron had those. This is something where they went in and studied and queried the employees and said, does this corporation live the value system that they say? For those that do, the return on assets is unbelievable compared to the bottom group. The sales growth, again, is unbelievable. These are absolute key factors in what drives a company. It’s undeniable. We’ve experienced that just in our own business as well.
More from this series:
Creating Corporate Culture – Praxis Now Interview Part 1