What is company culture?
Despite how obsessed the startup world is with company culture, there’s no singular definition we can all turn to. But while it’s difficult to put a dictionary definition on company culture, there are really two parts to it: Philosophical and practical.
On a philosophical level, company culture is the intangible atmosphere of your company. Some people call it the “personality” or the “glue that holds everyone together” or even the “soul.” It’s as much a feeling — of belonging, of shared purpose, even of similar ways of dress — as it is an aspiration for the entire company to contribute to.
“The truth is that culture – on its own – is not the thing that will bring you success in whatever way you may define it for yourself and your team,” Adii Pienaar, founder of Conversio, says. “Building a successful business requires many different things to work well. Culture is, however, the pulse that influences every one of those things.”
On a practical level, company culture is formed around common goals, values, expectations, mission, and the physical work environment. Everything from hiring choices to dress code the type of software you choose to use can contribute to company culture.
But don’t fall into the easy trap of thinking that “company culture” means “foosball tables and in-office kegs.” While those things may be a party of a company’s culture, they’re by no means all it takes. Here’s a close look at what else companies need to build a great — or terrible — company culture.
Examples of great company culture
Google consistently tops every list for great company culture, and for a good reason. While the company has been satirized for all of the stereotypical tech startup reasons — free food, foosball tables, nap pods, and an office full of expensive dogs immediately come to mind — employees insist that they love Google’s company culture for deeper reasons.
Employees aspire to Google’s mission to “organize the world’s information and make it universally accessible and useful,” seeing their work as impactful and important in the larger world. They’re also some of the most ambitious and self-driven people in the world, which is a difficult group to keep engaged and interested over the long term. But Google manages to do it.
And, of course, that free food and those nap pods certainly don’t hurt, either.
Hubspot has been famous for their great company culture for about as long as we’ve been using the term “company culture.” They’ve even created an entire slide deck on how to follow their lead and with tips like “Whether you like it or not, you're going to have a culture. Why not make it one you love?” and “HubSpot has a no-door policy, where everyone has access to anyone in the company,” you can see why.
Another cool thing about Hubspot’s company culture is that it’s spread over a wide geographical area. The company — which has 1,960 employees in offices around the world — believes not only that happy employees do the best work, but also that there’s no need to punch a time clock or to report to a regular office in order to produce great work.
If it sounds revolutionary, that’s because it is. And it’s also not for everyone, which is a good lesson when you’re working on building your own company culture. Just as your product isn’t for everyone, neither should your company culture be! Establish your company culture, find and recruit the people who best fit, and you’re much more likely to be successful.
Zappos founder Tony Hsieh has been redefining how offices — and company culture — work since before almost anyone else. Between being one of the first companies to embrace the open office plan to buying part of Las Vegas, it can seem like Zappos’ is constantly making the news. I mean, Hsieh literally wrote the book on employee happiness.
One interesting part of the Zappos company culture — and something that’s probably more important than an open office plan, which recent studies show aren’t as great as we thought they were — is the fact that it’s constantly evolving. Three years ago, when Hsieh suspected that his company’s growth was interfering with the company culture he took so much pride in, he did a total revamp.
And, once again, the new company culture didn’t work for everyone. Hsieh, however, took that into account, offering buyouts to anyone who wanted to leave. Eighteen percent of his employees took the buyout and another 11 percent left afterward, with no buyout. But the company is more profitable than ever and, after the adjustment, Hsieh will more likely than not find that his remaining employees (and future employees) do fit the new company culture.
4. Warby Parker
If you’re not yet convinced that great company culture is as good for your company as it is for your employees, then look no further than Warby Parker to be convinced. Any startup that’s ever had the privilege of scaling can tell you how difficult it is to maintain employee satisfaction and company culture, but Warby Parker managed to not only do it but do it fast: They grew to more than 1,400 in eight years.
Some of the pillars of Warby Parker’s company culture include focusing on team unity and a focus on peer-to-peer guidance and training. They also rally all employees around a common mission, which is providing one pair of glasses to a person in need for every pair that they sell. Keeping a common mission in mind — whether your startup is specifically mission-driven or not — is essential to fostering great company culture.
Examples of bad company culture
While tech companies have led the way in innovation around company culture in the past two decades, it’s not all healthy employees smiling at each other over free, ethically sourced coffee. The greater world first became aware that all wasn’t right at the ride-sharing giant when Susan Fowler, a former Uber employee, wrote a public post about sexual harassment and discrimination she experienced during her time there. Once that initial dam broke, it all came spilling out.
The headline for an article in The New York Times called the Uber company culture “aggressive and unrestrained.” The article itself goes on to describe a company that prizes “meritocracy” and “hustlin’” over team work or caring for each other. It’s in that environment — where results were often prized over anything — that the type of harassment Fowler described was able to thrive.
But, some people say, that ruthless culture is what got Uber to where it is today — a company worth billions of dollars that has a firm grasp on the ride-sharing market. And while it’s undeniable that Uber is a success, its IPO actually illustrates how allowing toxicity to thrive can hurt a company’s financial prospects in the long run.
That fact is illustrated in Uber’s IPO filing, where they acknowledge that the company’s by-then well-publicized toxic company culture is a risk that investors should take into consideration. “Our workplace culture and forward-leaning approach created significant operational and cultural challenges that have in the past harmed, and may in the future continue to harm, our business results and financial condition,” they wrote. “A failure to rehabilitate our brand and reputation will cause our business to suffer.”
While it’s common for tech startups to almost deify their founders (think of the reverence for “Zuck” at Facebook), it’s not always a great move. The case of Uber also illustrates the potential danger of building an entire company culture around one charismatic leader. Travis Kalanick is, by almost all accounts, a volatile, aggressive megalomaniac. He built Uber in his image — and his image isn’t good.
Amazon is an interesting case when it comes to company culture. On one hand, employees use terms like “bruising,” “relentless,” and “churn and burn” to describe their experiences there. On the other hand, Amazon is one of the most successful companies in the world, propelling Jeff Bezos into the very top echelon of the world’s richest people.
And some employees actually love that fast-paced, brutal environment. So is Amazon an example of great company — or terrible company culture?
The short answer is: Both? For many, many people the culture at Amazon won’t be a good fit. There are absolutely more people in this world who prefer team work and a company bring-your-dog-to-work policy over a place that tells you to “climb the wall” when you hit it.
“Most of the existing rhetoric on culture says all companies should have managers who are nice and friendly and treat their employees like family,” Denise Lee Yohn writes in Quartz. “The common notion is that every workplace should be nurturing, encouraging, and inclusive. That’s simply wrong.”
Yohn’s point is one well taken: Different people respond to and like different environments. And in that perspective, Amazon’s company culture is a resounding success. It’d just be hard — if not impossible — for most of us to swallow.
3. Forever 21
Unlike the rest of the companies on this list, Forever 21 isn’t a tech company. But that doesn’t mean that startups can’t learn from their mistakes.
Famous for ripping off independent artists and contributing to the fast fashion culture of waste, Forever 21 is also a really crappy place to work. They’ve been sued by their own employees multiple times and their CEO has a measly 30 percent approval rating. They also don’t provide adequate benefits and reportedly force employees to stay in the stores through their lunch breaks and long after their shifts end.
Lessons to bring into your startup’s’ company culture
So what can you learn from these company cultures? Let’s take a look at the biggest lessons you can pull from them.
1. Remember that your company is not for everyone.
One thing that comes up again and again is that a strong company culture means it’s not for everyone. In fact, if you try to appeal to everyone, you’ll more likely end up appealing to no one. So focus on creating the type of company that you’d like to work at — and that you think people would like to work at with you — and be clear about what that is.
HubSpot knows this. Zappos knows this. Even Amazon knows this.
If people aren’t a good fit? Let them go. Both they and your company will be better for it.
2. Create a common goal.
If there’s one thing humans like to rally around, it’s a common goal. What’s your startup’s goal? Is it mission-driven? Are you focused more on revenue? Do you want to change your client’s lives? Drill down on a big picture goal that your employees can latch on to if you want to keep talented people engaged.
3. Be explicit about your expectations, before hiring.
Once you’ve established what your company culture is, be clear to communicate it to all potential new hires, so they can decide whether or not they want to be a part of it. If you’re not explicit — and honest — about your company culture before hiring, how can you expect people to fit in once they’re hired?
4. If you’re going to be intense, don’t forget other ethical concerns.
While Amazon is an example of a company culture that’s intense and grueling with great results, Uber is an example of how a similar type of culture can hurt a company in the long run. That’s because Uber’s CEO Travis Kalanick didn’t make sure that other ethics were upheld, outside of GROW GROW GROW. Amazon’s Jeff Bezos, on the other hand, has created at least an image of relentlessness with a focus on betterment.
Both companies, of course, have their negatives. And some would argue that the negatives vastly outweigh the positives. But it’s worth considering the fact that “company culture” doesn’t always have to equate to a coddling, friendly environment.
5. Company culture should evolve.
Take a page from Tony Hsieh’s book and be willing to change course, if needed. Just like personal relationships, company cultures can and should evolve. Be open to that evolution and be prepared to the upheaval that can accompany it, if you want your startup to be around for the long haul.
Want to know more about company culture?
Still trying to figure out how to build the best company culture for your startup? Check out theses resources from the vast community of Startups.com member and experts.
What Is Company Culture?From 3 Employees to 300: How We Preserved Our Company CultureConversio On How To Build a Great Company Culture9https://www.startups.com/library/expert-advice/how-to-build-great-company-culture-conversio)The Seven Culture Mistakes That Startups Make
- Respect and fairness.
- Trust and integrity.
- Growth mindset.
- Employee engagement and opportunities for advancement.
- Communication and transparency.
Good or Bad Company Culture Definition
A healthy culture is characterized by positive employee engagement, high performance and leaders who live their values and hold employees accountable for doing the same. A bad company culture definition is just the opposite.
A bad company culture breeds presenteeism, burnout and high turnover. While these may sound a bit like buzzwords, they're poisonous symptoms of poor company culture - and it's essential that every CEO, founder and manager actively avoid them.