Culture is a Capability

A culture defines the normal way people behave in a particular group. It provides the cues, boundaries, guidelines and encouragement that help individual members of a group know what’s right and what’s wrong. Culture guides decisions that result in actions. The best way to understand a culture is to pay attention to actual behavior and evidence created by the people of that particular group. It’s also great to compare groups to discover similarities and differences in their cultures, which is what the field of Anthropology is all about.

In the context of a company, I often hear people say things like, “We have a winning culture here,” or “We’re building a culture of innovation,” or “Our culture is defined by our values”. These could all be true statements, but they are not useful as descriptions of their particular cultures.

To describe a culture, specific traits need to be identified (or “ways” that people interact) and evidence needs to be found proving that these “ways” are useful – or at least believed to be useful by the members of that particular group. If a company has a culture of innovation, what characteristics about their behavior demonstrate innovativeness and what artifacts of that behavior are cherished and celebrated as the outcomes of that behavior?

I’ve had the great privilege of working in some of the world’s most innovative companies (as defined by Fast Company magazine) including IDEO, Charles Schwab, Levi Strauss, and Hulu. Leaders at each company believe their cultures are a significant reason for their success. Having been a part of each of them, I can say that they are each distinctly different from the others. So while they may all have “winning” or “innovative” cultures, there is no common culture across them. Behaving one way at Levi Strauss could actually get you fired at Hulu and vice-versa.

To understand what is innovative at IDEO, you just have to listen to the stories they tell each other about great moments in the company’s history. In fact, so many people ask IDEO about their culture, nearly any person who works there can point to examples of their innovative behavior that resulted in breakthrough product designs like the first Apple mouse or the Crest Neat Squeeze toothpaste tube.

What every leader should know about culture is that it has to be defined, built and actively managed if you want it to help your business succeed. In most cases, culture should be defined in response to a business problem, not in advance of one. I don’t believe there’s such a thing as “the best” culture that could be built first and then applied to any business problem. So just like a supply chain for making shoes would be different than a supply chain for making cars, each culture should be constructed to address the unique challenges of the business at hand.

Culture should not necessarily be a reflection of the founder, CEO or executive team—although leaders must behave in accordance with the culture or it is unlikely that others will follow. Lip service to a value like customer service followed by actions that don’t treat customers well will not build a customer-centered culture. All of the advertising dollars in the world and videos of the CEO pronouncing that he personally cares for every customer who flies with them will not make airline customers feel treated with respect if they are dumped from flights for unexplained reasons. Culture is not a values statement or a manifesto. Culture is a capability that provides direction and support to every member of an organization in order to achieve a strategic objective.