The workplace culture matters

Introduction

Studying the best practices of continuous improvements (Kaizen, Lean) and product development approaches (Design Thinking, Google’s Sprint Method…) I resulted in that to make these really ground-breaking practices working an organization should have a certain culture. Creating a flexible and innovative organizational culture never been an easy task. Each of us moves daily through numerous cultural environments, from the local community, church, to business organization or school. No doubt the connection to those cultures, either inspires the best within us or reduces us to average. The central idea of this article is just to draw readers' attention to the actual value of organizational culture where employees take responsibility for results and moving away from bureaucratic traditions where mechanical approaches dominate.

“Culture eats strategy for breakfast” — Peter Drucker

By this quote famous management consultant and writer Peter Drucker didn’t mean that strategy is insignificant — rather that great and inspiring culture is a doubtless route to organizational success.

A great culture is like stone made an arch bridge and poor culture is like a hanging bridge strung together with fraying ropes. Let’s review 5 examples of extraordinary working environments: Toyota, Valve, Netflix, Spotify, Google.

Toyota: Continuous Improvements and People’s Respect

Toyota Motor Corporation has become one of the most successful companies in the world today. The company is proud of the fact that its management principles are different from those taught B-schools because its management tools matter less than its mindset.

“Something is wrong if workers do not look around each day, find things that are tedious or boring, and then rewrite the procedures. Even last month’s manual should be out of date.” — Taiichi Ohno, former Toyota executive vice president

The Toyota Way is a framework that defines the fundamental values and business methods all the employees should apply in every aspect of their day-to-day work, at every level of the company, worldwide. The Toyota Way is built on two pillars: Continuous Improvement, which takes in the concepts of Challenge, Kaizen and Genchi Genbutsu, and Respect for People, which embraces Respect and Teamwork.

1. Challenge. Every business or technical challenge is approached with creativity and courage.
2. Kaizen. (“good change” (Kai = change, Zen = good) is a strategy where employees at all levels of a company work together proactively to achieve regular, continuous improvements to the business process.
3. Genchi Genbutsu. (“going to the source”) — is about checking all the facts, so you can be sure you have the right information you need to make a good decision.
4. Respect. In our relationships with our colleagues and with others, it is important everyone is respected both for what they contribute and who they are. That includes their ideas and their cultural and personal beliefs.
5. Teamwork. Every member of a team is given the opportunity to do their best and the accountability to achieve results.

What is so unique about Toyota’s corporate culture: nothing is ever seen as a status quo; there are continuous efforts to improve which result in small, often imperceptible, changes over time. To some observers, the company has become insufferable.

Valve: Manager-less workplace

What does the workplace of the Creative Economy of the 21st Century look like? Valve is a good example of it. The game developer owns a management system called the “flatland” where there are no bosses, or managers, not even the founder/president. This idea stems from their hiring process; if you are hiring the best and the brightest, why would you devalue them by forcing them to sit at a desk and do what they are told to do. There are no job titles at Valve, just people who want to work hard and produce high-quality content.

“A fearless adventure in knowing what to do when no one’s there telling you what to do.” — quote from the Valve’s handbook for new employees.

To understand more about Valve’s culture it is worth to look at their Handbook for New Employees, also there is a quick video below.

What is so unique about Valve’s corporate culture: when creative people have freedom, it creates the opportunity to liberate their talents and creativity, instead of waiting around to be instructed. Otherwise, this work is not for those who prefer to work in a traditional environment or for organizations focused on maximizing shareholder value.

Spotify: Self-made engineering culture

Spotify is one of the fastest-growing tech start-ups and another good example of the unique working culture. Founded in 2008 Spotify rapidly expanded to a company that currently employs 2,600 employees worldwide.

“Fail Fast. Learn Fast. Improve Fast.” — Spotify Engineering Culture

Spotify is known across the globe for its unique organizational structure and engineering culture. Spotify uses “squads”, “tribes”, “alliances and guilds” to run its business. To know more here is the video below:

What is so unique about Spotify’s corporate culture: to grow fast, to attract the right people to foster innovation and agility Spotify actually created own engineering subculture. It provides own people with lots of responsibilities and trust. It’s okay and safe to fail, but you have to learn from it.

Netflix: The Radical Transparency

The philosophy of “radical transparency” to spread out through the Netflix company. Netflix’s CEO, Reed Hastings, has implemented the practices of “involvement everyone in debates about Netflix’s path, from pricing policy to the look of Netflix’s logo,”.

“The best managers figure out how to get great outcomes by setting the appropriate context, rather than by trying to control their people.” — Reed Hastings, CEO, Netflix

Also, Netflix implemented own feedback loop providing own employees with ongoing opportunities for improvement. To know more about Netflix’s culture have a look at the presentation that leads the viewer through the seven aspects of Netflix’s culture:

What is so unique about Netflix's corporate culture: the culture of constant feedback that pushes one to the extreme openness ensuring high performance of all employees. Netflix has succeeded not only in implementing a high-performing culture, but also in successfully retaining top talent.

Google: Teams oriented culture

Over the years, Google has acquired a lot of companies and integrated so many brilliant teams into own ecosystem. Intellectual and cultural diversity is deeply embedded in Google’s DNA. Actually, the company spent millions trying to better understand it’s own people. One of the company’s most interesting initiative is Project Aristotle, it gathered several of Google’s best and smartest to help the organization codify the secrets to own team effectiveness.

“We want to understand what works here rather than what worked at any other organization.” — Laszlo Bock, former Senior Vice President of People Operations at Google.

The project resulted that there are five key dynamics that set successful teams apart from other teams at Google:

What is so unique about Google’s corporate culture: Google’s corporate culture is in the diversity of smart people and their ideas. It strictly uses data and analytics to make the most accurate people management decisions that they could make. People's operations (HR function) are where science and human resources intersect. Obviously, it’s what keeps Google a top-performing company.

Conclusion

Bringing the best practices of continuous improvements and product thinking to the business requires an advanced working culture. The cases described above are active examples of extremely successful organizations with ground-breaking cultures. The most innovative cultures are rarely comfortable they can only guarantee the adventure. Definitely, pushing business and technology boundaries breeds discomfort. Each of the mentioned successful companies has its own vision of working culture:

• Toyota: Continuous process improvements and people efforts recognition;
• Valve: Ultimate freedom culture for creative people to realize their potential;
• Spotify: Re-engineered organizational structure and innovative software development approaches;
• Netflix: Radical transparency environment and shared decision making;
• Google: Culture built on quantitative analytics and team diversity.

“ Customers will never love a company until the employees love it first” — Simon Sinek, Author of Start with Why