Exploring the Power of Positive Organisational Culture
Over the last four years, we have increased our GPTW employee trust score at Codex by 10% and our annual revenue by over 18%. But in such challenging times for businesses across the globe, how have we achieved both successes in our organisation? It is simple – refocusing our organisational culture to actively engage and listen to our customers and employees.
And we are not the only organisation to see this correlation between employee engagement and profitability, with a recent study by McKinsey finding that organisational culture is the most significant predictor of success.
If you have ever thought about making subtle – or dare I say, drastic - changes to your company culture, I implore you to read on as I make a business case for why company values should be an essential consideration for all CEOs and business leaders. Plus, I will share some insights on how we developed our values at Codex, our learnings from the process, and some clearly defined steps on what you can do to start building a successful organisational culture today.
What is Organisational Culture?
Somewhere along the way, the definition of organisational culture has become wrongly synonymous with buying ping pong tables, beer kegs and free food. Likewise, company values have long been considered a concept reserved exclusively for Google, Apple, and similar tech giants with deep pockets.
However, I have learned that establishing a positive organisational culture has nothing to do with what employee extras you offer (although those are definite niceties) and everything to do with the company values and beliefs you set in your organisation.
Organisational culture in its correct form is defined as the collective ethos of an organisation, its shared values, goals, attitudes, and practices that characterise who they are, what they do, why they do it, and how they do it. Organisational culture revolves around how individuals feel about their work, the principles they uphold, the direction they envision the business taking, and the steps individuals can take to get there.
Why Organisational Culture Should be Important to Business Leaders
It is critical to have a robust organisational culture because when you look after your employees, they will naturally transfer their experience to the customers. Regardless of your company’s core beliefs, treating every person fairly and ensuring they know how much you regard them is a crucial part of developing a successful culture in any workplace.
On the other hand, poor organisational culture can negatively impact business performance and employee morale. Ultimately, organisations with poor, depleting workplace cultures are likelier to lose employees and customers.
In an era colloquially dubbed The Great Resignation - where employees are still quitting their jobs in record numbers - establishing a positive organisational culture can no longer be considered an optional requirement for companies but a business necessity. For one, the hidden costs of employee turnover can significantly impact an organisation’s profit and success and its overall morale and culture. So, if you are a CEO or business leader who has not done this already, I encourage you to prioritise setting your company values in 2023.
Need further proof that this is a valuable exercise? Here are some research findings and stats that substantiate this:
- 76% of Irish companies that have successfully created a positive culture are more than twice as likely to expect double-digit business growth.
- 79% of employees in companies with a positive organisational culture plan to stay in their jobs long-term.
- 71% of employees working in a positive culture feel it is okay to speak up if there is an issue, while 68% claim it is easy to get support when needed.
- 66% of employees have been empowered to share ideas in a positive organisational culture, with 60% finding collaboration easier.
This shows that leaders who reinforce company values create a culture where business thrives.
It must be said, however, that while creating a thriving organisational culture does start at the top, it is not the sole responsibility of the CEO. Everyone in the organisation, from the CEO to the newest intern, must embrace the organisation’s culture to succeed. It involves putting your underlying values into action. The business's responsibility is to guarantee that each employee knows the requirements and acts accordingly. Strong culture should naturally foster inquiry, respect, cooperation, and employee wellness.
Our Journey at Codex – Setting A New Tone
Since our inception in 1979, Codex has strived to be a customer-centric company that empowers our customers with innovative office solutions. And I am proud to say that we have done well delivering on this over the last 44 years. We have grown from a one-person operation to over 80 staff members and €33 million in turnover by staying true to our vision.
Our business has completely transformed as we have scaled over the years. We have made new acquisitions, heavily diversified our product range, expanded our customer base, and even tried our hand at some new ventures, some of which have been more successful than others. Although we have always had a clear vision (customer experience!) and a robust set of beliefs that drives our business forward, the company has never documented or communicated our values to the broader team.
When I started as the CEO at Codex, I had ambitious growth goals that I knew I wanted the company to reach over the next 5-10 years. To achieve these goals, I saw a clear pathway to success. In my mind, it was not about ramping up our sales efforts but taking a step back and figuring out who we were as a company and how we wanted to run the business. To quote Simon Sinek, I felt we needed to start with the Why.
One of the first tasks I set out for myself in 2019 was to appoint a new Senior Management Team. We intended to ensure that our business and culture objectives aligned as we continue moving with the times and changing customer requirements. Once I was confident I had the right team in place, one of the big projects we set out to work on in late 2020 was to work together to develop our company values and objectives and, ultimately, figure out our why.
Once we had agreed on the approach we would take for this project, we brought on the team from Lean Disruptor, who ran several Design Sprint sessions to isolate the areas that we felt we were performing well in as a company and develop the skillsets we needed as a collective team to get us to achieve our long-term goals. This format helped us stay honest throughout the process and ensure that we matched the values that Codex started within the same place and futureproofing ourselves in line with our long-term objectives.
At this point, the SMT and I had isolated a list of potential company values in our brainstorming session and selected a core three that we wanted to embed into the organisational culture at Codex; we put it out to staff in an employee survey to help us choose the remaining two values.
Today, we have five core values that we currently run our business with - Customer First, Innovation, Integrity, Belonging and Ambition. These company values do not just exist on a piece of paper or a file buried deep in our SharePoint site; they have become the crux of who we are as a team, how we hire new staff members, and how we make our tough decisions in the day-to-day running of our business.
Codex has a customer-first ethos, meaning we will always prioritise your needs.
We like to push the envelope at Codex and love to find new and creative ways to solve our customer's challenges.
We do not believe in cutting corners at Codex; we believe in doing things correctly instead of quickly.
We are a family run business and value the connections we form with our customers.
We have worked hard for the success we have achieved, and continuous improvement is what drives our continued growth & development as a business.
From a 2021 GPTW poll, 33% of Irish employees said they knew their company had values but could not tell what they were. If that sounds familiar, here are a few tactics we have found helpful in fully incorporating our core values:
- We tie our company values to our annual company objectives.
- We refer to our company values in any communications sent to staff.
- We incorporate our values into our onboarding presentations for new staff.
- We send quarterly staff surveys to get a pulse on areas we can improve throughout the year.
- We rolled out staff recognition awards in 2022 to acknowledge staff members for excellently upholding the values.
- We have tied our quarterly company days to either a company value or an area of improvement that has come out of our annual GPTW survey.
While this exercise started at the top, one of the most important reasons this project succeeded is because it put the employees in the centre. These company values were not conceived in isolation but instead devised as a collective effort influenced by our employees and the entire organisation, so they were something that the whole team felt they had a stake in.
Some of the most significant company wins that we have seen during this time include:
- Growth in new categories – Furniture sales have increased by 300% since 2019.
- Engagement (and trust) of our staff – We ranked in the top 30 SME Great Place to Work businesses in 2022 with an average trust score of 78/100.
- Investment in the Irish market – over €20m of products and services bought in the local economy in 2022.
- Investment in technology and innovation – €2m invested in IT infrastructure and solutions in the last three years.
- Increased customer experience – 89% customer satisfaction score in 2022.
- Ongoing talent development – 16 internal staff movements since 2019.
- Increased staff involvement – 12% increase in 2022 in staff feeling involved in decision-making.
Our People is Where Our Culture Begins
Codex’s culture is centred around our vision and purpose – to help Irish workplaces power their people, productivity, and potential. We believe that integrity, honesty, and trust are central to our organisational culture and that all interactions with colleagues or customers are managed with the utmost respect and dignity.
As a leader, your vision and values are regularly tested by the company's and society’s dynamics. Managing an established family-owned business requires a significant commitment to the well-being of the business, customers, and various stakeholders.
We are planning for the next generation – and I truly believe that leading is about identifying and building a vision and values for the future. Each generation impacts the company's growth, and despite the challenges, we understand the benefits of doing things right.
Evaluating our strengths as a company over the past forty years of business while futureproofing where we would like to go and what skills we need to get there has created a very much employee-oriented environment at Codex.
Codex has achieved a lot because of our employees and the culture they have fostered. The great benefits and a fun and dedicated workplace to making customers happy all fit in with Codex’s approach to organisational culture. We encourage creative thinking in the workplace. We celebrate innovative and diverse thinking. We recognise that everyone plays a part in delivering an excellent customer experience.
What I Learned Fostering a Thriving Organisational Culture
Since becoming CEO, I have faced many challenges, including a mammoth ERP migration, COVID-19, and ongoing supply chain challenges. If there is one thing I have learned along the way, it is that usually, every challenge comes with an opportunity, but before you get there, you sometimes must make a tough decision. Whenever I face a complex scenario or dilemma, I ask myself, “am I staying true to our values?”
This feeds into our always-learning philosophy. And for me, as the CEO, it is no different. Restructuring our organisational culture proved a vast learning curve for me. One that taught me that our values should always lead our strategy rather than the other way around. Our values should always answer the ‘Why.’
It is also about accepting that things take time. Cultural change does not happen overnight but requires a continuous and collaborative effort. Finally, and the most critical learning point, creating a positive organisational culture is not about starting at the top down but putting employees at the centre.
Organisational culture is a business’s number one asset. Once your strategy and culture are aligned, it increases the likelihood that your organisation will produce steady and attractive profitability and growth results. Your employees’ energy and self-assurance are indicators of such a culture. They have every right to be proud of the outcomes of their work. A great workplace culture improves employee engagement, the working environment, and how well an organisation represents its objective.
How You Can Get Started in Your Own Company
Positive organisational culture is one of the few sources of long-term competitive advantage still available to organisations today. And while cultural change can be daunting for any organisation, it is possible. It just takes time. Successful leaders stop looking at culture with frustration; instead, they use it as a critical management tool through strategic leadership development, professional growth programmes, and training opportunities.
Firstly, leaders need to understand the culture that prevails within their organisation. They can then specify a desirable target culture to work towards that involves everyone from the top down. From this, they can grasp the fundamental processes of organisational design, leadership alignment, organisational discourse, and ambition articulation.
The following are some of the steps we took when we first started looking into the culture here at Codex and could prove very beneficial for your organisation also:
- Get your team behind it – Make sure your Executive team is on board and believes in this project, as they will be the primary drivers of its success.
- Decide the process – Outline who will be involved, the key timelines, and the steps required to execute the project.
- Evaluate honestly – Brainstorm what your company is doing well and highlight the skillsets you need to achieve your long-term goals. Commit to being honest, critical, and forthcoming at this stage.
- Get feedback from staff in your organisation – You are more likely to get buy-in if the larger team feel they have had an opportunity to contribute their thoughts and have a say in setting this new tone.
- Accept the temporary disruption – Introducing new values may bring a new way of doing business. Sometimes, this may mean you decline opportunities if they don’t align with your values.
- Make sure your core values exist outside of a sheet of paper – They should ideally be reinforced in everything you do (i.e., role definitions, performance management and professional development plans).
- Incorporate your values into your recruitment processes and onboarding documents – When looking for talent, you choose candidates that closely align with your core values.
While the above may seem time-consuming, building, growing, and living your company values is one of the most worthwhile exercises you can carry out, having seen the impact this has had on our organisational culture. The benefits we have found include an increasingly diverse array of service offerings and vigorous growth, to name a few.
In the end, if you have successfully established an environment where employees feel excited about coming into the office, feel a sense of purpose about the work they are carrying out, and feel they have a high level of work-life harmony, then you are doing things right.
Check out how Codex continues to embrace organisational culture through Our Values.
If you have any questions on anything discussed in this blog or want to know more about Codex's journey to a positive organisational culture, connect with me on LinkedIn!
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