What is (good) company culture?

Culture is a hot topic these days – if your young company does not have a culture then it’s not a cool startup right? Well let’s just stop right there. A business culture is not optional – it’s not something that you may or may not have – it is there whether you noticed or not. The question is do you know your culture and are you being intentional about reinforcing it every day?

Let’s look at this from another angle for a minute and consider what a culture is not:

  • it is not having a games machine, pool table or table tennis league
  • it is not dressing down on a Friday or having a casual dress code
  • it is not having flexible working hours or a short week
  • it is not painting the walls a bright colour or replacing your walls with glass
  • it is not providing breakfast, lunch and dinner in the office
  • it is also not installing a beer fridge
  • most of all it is not writing values or behaviours on the office wall!

Before I get angry comments let me clarify – a company with a good culture may have many of those things – but they don’t define the culture.

With that out of the way, let’s consider what does make up a company’s culture. As with culture outside the office place it can be described as the way that people behave and communicate – it’s the conventions by which any group agrees to collaborate and probably incorporates shared interests of some sort. So you see, culture exists whether or not we intend it to – without careful consideration it will become the sum of the personalities people you have hired.

A Wall Street trading company may have a culture of wealth aggregation, a charity organisation probably focuses on improving the lives of a segment of society. The culture within your company may reflect the work you do or it may not. Your culture may have a social pub-each-evening focus or your office may be 9 to 5 desk workers – neither of which are defined by your industry or product offering. So if it is such a vague concept that seems to be influenced from every angle then how can it be shaped?

They say that culture comes from the top, and most of the time that is true. Company leaders behave in a certain manner – they exhibit values or behaviours that the rest of the company adopt over time. Those in the business first hire everyone that follows and they probably pick people that share their values. If, however, the team is purposeful about it’s culture – sharing an understanding about what drives them or communicating a set of values then the culture will follow. What you (as a company leader especially) must remember is that you need to live these values and exhibit the culture that you wish to see in the company. Otherwise it’s just another example of leadership delusion or an exercise in futility. Be inspired by other’s successful cultures of course, but make it your own.

Remember that great company culture is worth defending – it could be why many of your team come to work each day.

How can we ensure fair salaries when growing?

As any company, especially a young one, grows it will have times when budgets are tight and times when they are not, people will likely be recruited in cycles and you will probably want to hire people from a great many different backgrounds. With that in mind how can you strive for fair salaries for everyone in the business?

This breaks down into a few different areas – I will try to cover:

  1. Paying everyone the best you can
  2. Don’t let the savvy negotiator get paid higher than anyone else
  3. Keep salaries fair over time

Paying the best you can

At the beginning you may not have much money and early staffing may be impossible at market rates. Or you may be in a situation where budgets are tight and it’s not possible to pay as well as you would like. Either way be open about it – discuss the reasons with your team and with recruits when explaining how you worked out the offer.

There has been criticism recently about offering non-cash benefits in lieu of salary – and maybe the point is valid. If you are clear about what you can, and can’t, pay and communicate it clearly I don’t see the problem. If you intend to up salaries say so and if you don’t then say that – it’s all part of recruiting staff that fit the culture you are creating.

Don’t flex your budget for good negotiators

Not everyone likes to negotiate on salary – some like to be valued rather than drive a deal. Others may just not be good at negotiating, and after all that’s not why you’re hiring them (maybe this would help with the gender pay gap?).

The underlying principle here is that everyone should be paid fairly – based on the value they bring to the company. To achieve this it’s important to use an interview to gauge the applicant’s relevant skills and experience to determine where in your pay scale they will fit. It may not always be possible to get this right but being able to explain your working will be valuable.

It’s common when explaining this method for an enquiring mind to comment: “Aha! But that means you should sometimes offer a salary above a candidate’s expectations!” That’s absolutely true. Sometimes an individual has undervalued themselves or perhaps they have only worked at companies that have lower salaries – whatever the reason it’s a pleasure to rectify 🙂

Review salaries regularly and fairly

Everyone knows that salaries need to be reviewed on a regular basis to reflect new skills, additional responsibilities, inflation and perhaps company success. However this is traditionally tied to annual reviews which pose the following challenges:

  • Staff may be less candid about negative comments if they think it could affect their remuneration.
  • Depending on the time of year or funding cycle some staff may get lucky where others could be reviewed at a less profitable time.

Therefore I prefer to review all salaries at the same time either annually or more often. By reviewing all salaries at once you are sure that the funding landscape affects everyone equally and no one is left behind. The flip side of disconnecting from the personal review process is that it may be harder to reflect individual progress but this can be avoided with ongoing objectives and learning which seems like a positive approach anyhow.

Always be fair

Hopefully these are some useful thoughts about keeping pay fair whilst not sinking the company. If you have any other thoughts on this please comment below.