As someone who has written quite a bit about small business ethics, there is a trend that I find to be quite encouraging. Entrepreneurs are paying a lot more attention to the cultures they create in their businesses.
The culture of a business defines and shapes how a company’s owners and employees act, think, and feel as they go about their work. Culture sets the behavioral expectations and ethical standards in a company. It guides how employees are expected to interact with each other, with customers, with suppliers, and so forth.
Businesses with well-developed cultures tend to have a stronger sense of ethical awareness among their employees. All things being equal, these companies are also are more successful than those that do not intentionally build a strong culture.
So how should an entrepreneur go about building a strong culture in a business?
Creating a culture should be treated just like the development systems, policies and procedures, and structure. It should be tied to the growth of the business.
As you are getting ready to launch your business, make sure to list your most important core values. For example, these might include values such as honesty, openness, or fairness. These values will serve as the core for the ethical standards in your business.
Next, write down a few things that you will commit to doing day-to-day to bring these values to life in your business. It could be related to how you will work with employees, how you will treat customers, or how you will balance work and family. Keep this list handy to remind yourself of what you have committed to do to shape the early culture.
As you begin to hire employees, use your core values to shape some of the questions you ask candidates in the interview. Develop open-ended questions that will require them to show you their values. Don’t ask leading questions that give away what you want to learn about them. Hiring people whose values are consistent with yours is as important as the skills and experience they bring to the job.
As your business grows, integrate your values and ethics into your policies, procedures, employee manuals, and so forth. Talk about your core values often. Use them in the language you use to coach and train employees. Include a discussion of your values in every meeting and build it into your decision-making processes.
If your business grows large, recognize that an important function of being the CEO of your business is to ensure that your culture is sustained over time. Develop formal codes of ethics based on your core values and hold your team and the employees they supervise accountable to these standards. Communicate your values through your words and actions.
However, I need to add a word of caution about culture. As important as a strong culture is to a business, it needs to be put in perspective. Many entrepreneurs mistakenly treat culture as the most important aspect of their business. It is not.
Building a desired culture cannot be put ahead of ensuring the sustainability of the business through meeting a need in the market. As Milton Friedman said, “The business of business is business.”
If an entrepreneur does not run a financial sound business, it does not matter how cool and attractive the culture is because the business will not survive.
As you grow and build your business, remember that building a culture is not the end goal of your business. Culture should be used to govern the means by which you and your employees pursue the financial and market goals you have established for your business.