Blog

First things first. Your company’s culture is ultimately built not on what you say, but what you do.

And, more important, by what you don’t do. What you permit. What you accept. What you allow. What you let people get away with. What you, as an owner or leader, let yourself get away with.

Take, for example, promotion decisions. Maybe you let a supervisor promote the candidate he likes rather than the best candidate. While you disagree, you think, “Well, it’s his department, so it should be his decision,” and let it go. Or maybe you let a supervisor promote the easygoing employee with lesser skills over a more skilled yet occasionally abrasive employee. While you disagree, you think, “Well, I don’t want to be seen as rewarding that behavior,” especially since it’s behavior you haven’t tried to address, and you let it go.

Everyone notices, of course. Few things get more attention than promotion decisions. And what happens?

A survey of more than 400,000 people conducted by the research and consulting firm Great Place to Work found that when employees feel promotion decisions are managed effectively, they are more than two times as likely to give extra effort at work. When employees feel promotion decisions are managed effectively, they are more than five times as likely to feel the people making those decisions act — not just specific to promotions, but generally as well — with integrity.

As a result, at those companies employee turnover rates tend to be half that of other businesses in the same industry. Productivity, innovation, and growth metrics also tend to be higher. At public companies, stock returns tend to be nearly three times the market average.

Add it all up, and one seemingly minor leadership aspect can create a significant major positive — or, as in the examples above, negative — impact on how a business operates.

Granted, you didn’t need research to tell you that.

Work for a boss who promotes their buddies, and you’ll focus on managing your boss. Work for a boss who promotes based on seniority, and you’ll coast along while you wait for your turn. Productivity, quality, innovation, teamwork — all the things you say you want, that you say are cultural values, take a back seat.

All because you let yourself get away with using poor — or lazy — criteria for making promotion decisions.

If productivity drives your business, promote people who excel at getting the right things done, and who excel at working with and through other people to get the right things done. That will become your culture. If teamwork drives your business, promote people who excel at collaborating, creating effective formal and informal teams, and helping others build the short- and long-term networks that help them succeed. That will become your culture.

The same is true for what a boss of mine once called errors of leadership omission: failing to act when you should have. When I worked on the shop floor, our supervisor let an operator get away with shipping subpar-quality work because the job was already late. We all saw it — and even though quality was supposed to be most important, we all instantly shifted to a meet-ship-dates-first mentality.

More generally?

• Let the salesperson who generates a disproportionate share of revenue get away with using their perceived status to treat other employees poorly and you permit a culture lacking in dignity and respect.
• Let people take credit for the ideas and even the work of others, and you permit a culture focused on the ability to manage up.
• Let the voice highest on the hierarchy win and you permit a culture that values the source of opinion more than the quality of opinion — which naturally stifles the creativity, engagement, and inclusion you say your culture values.

Want to know how to change a company’s culture? First take hard look at the behaviors and values you encourage.

Then take an even harder look at the behaviors and values you allow.