How important is organisational culture in a digital world?

I encountered the below great example on how a CEO builds culture by getting his hands dirty. But first let me develop some arguments on how I view the importance of culture in today’s fast and digital world.

“Culture is important to keep employees and to beat competitors”

In today’s fast environment and changing customer preferences you cannot operate a company without CSR thinking, sense of purpose and constant monitoring of the customer experience. Add to this mix the culture. The culture is becoming more and more important to be able to keep strong employees and to develop your business.

Make no mistake about it – the top management sets a company’s culture. The most influential people in a company will affect the culture. Companies with a strong and healthy culture are doing extremely well. Usually these companies have their founders still active (IKEA, H&M, Amazon).

Personally I have worked in different type of companies. All of them try to cultivate a certain culture but it is extremely hard. A culture is according to me based on:

·       Top managements way of thinking,

·       The questions they ask,

·       The way they think about the organisation,

·       The way they genuinely care for people and the way they give a purpose of where the company is heading.

In a fast and digital world culture is more important than ever. In Sweden we have an extremely hot job market within IT and people can change jobs on a weekly basis. In my company we have had a few great years but eventually reached a plateau. During this time the culture has changed. As you hit the wall the culture needs to absorb the effect so you wont loose your employees. We all know that the brightest disappear first. Some people say that tomorrow’s organisation will only exist for a couple of years, until the needs have changed or are fulfilled by others in a better way. I come to think of Tom the navigation company that was replaced by the Maps function in our mobiles. The mobiles and the two main platforms, Android and Apple can with a few moves kill a whole market. It helps that they have strong financial muscles but their strong culture helps to constantly advance.

Anyhow, if you are among the top management and reading this keep in mind that you are the one responsible to set the culture. Now to the wonderful story I found on the net:

“Culture is set by top manangement”

As a CEO of a huge company, you often get out of touch with your workers- all you see are results. Here’s a good story to highlight the point:

The CEO of a manufacturing company I worked for some time back visited our division for a “peptalk” type speech since the company was doing so well. He was trying to talk everyone and everything up, but noticed he wasn’t getting the expected response. At the time, we were all being forced to work 60+ hour weeks + and mandatory weekends to keep up with customer demands. We were all exhausted, fed up, and even though we were getting overtime, we felt like we were getting screwed (the factory was hot and involved a lot of physical labor). 

Our CEO, who happened to be a genuinely nice and caring guy, happened to see a woman with wet eyes during the speech. He cut things short, then asked her point blank “We’re surrounded by good news and you look so sad…can I see you in a few minutes?”

The lady’s name was Julie, and it was rumored she was about to be fired due to attendance. She was a single mom, and because we worked so much she had a hard time finding people to watch her kids, resulting in her being late or absent. She got called in to the manager’s office that morning, and by her response, we think she finally got the boot.

The CEO called us all into the meeting room again later that day (which was unusual), and wow—the law got laid down. He announced he was going to stay in town for two weeks and personally go through every employee’s records (there were over 250 of us!), and his office door would be wide open to anyone that would like to talk to him. He also said that nobody at his company would ever be disciplined over a family issue, and immediate changes would be forthcoming.

Julie came back to the crowd with a huge smile, so I assume things were straightened out. In that two weeks the CEO was there, plans were made for on-site daycare, weekly employee lunches, and temp workers were brought in to get our workhours down to the 40-50 hour range. Weekends were made volunteer only, and we all ended up getting $1000 bonus checks. We were all shocked, and it boosted morale like nothing else.

Driving a reputation: Brands & Donald Trump & Hillary Clinton

Working in a highly recognized brand once reputation is extremely important from many aspects. A positive brand helps drive sales. A negative hinders your sales.

It strikes me how similar this is in todays elections in the USA. People say that they do not like any of the candidates since their reputation is bad. Even though they feel that they have no choice. A bit like companies in various segments of the market especially markets with oligopoly (like banks, oil companies, etc).

In our case we partly sell due to the lack of alternative. The lack of competition. The question is how long will this hold. As soon as something better comes along you are done. The same thing is in politics. When something or someone comes along that is perceived as better as a political party you will not be able to react. Reaction has to start when you are the fatest cat around not when you already start loosing weight.

So the learning for any company out there is to get your innovation engine going. It can never stop especially in todays fast environment. Setup your organization accordingly. Get specialist, work with the culture but everything begins with asking the right questions.

The management bullshit books

Anyone who has read business administration at the university can testify the vast amount of management books one has to read in able to pass the courses. My reflections after working for a few years I can say they are all full off bullshit. Pardon my language but the models and theories presented in these books are so complicated that I think you have no use of them in real life.

I just read a book about the secret of companies that excel in business and it brought me back to my academic years. This book was trying to identify the main factors for successful companies. To make a long story short you the time one can say it is a mixture of management style, strategy, right focus and a bit of luck.

From my experience what most of these books teach us is common sense. The absolutely most important thing for successful companies, according to my opinion, is to understand what your are good at and why. When you understand this you have the core of your success. Building on this will excel you to long-term happiness. You can illustrate it like an onion. The core is where you start thereafter you need to build layers around the core. Many companies do the mistake to start things far away from the core, which is a real gamble.

Understanding your core is in many ways harder that people think. Usually it sits with the founder of the company and when he leaves there is a real risk of loosing this insight if he has not passed on this knowledge. For example Steve Jobs understood this and tried to pass it on to Tim Cook. The founder of IKEA is planning to retire and has tried for many years to build a culture, which reflect his values. Let us see to whom he will pass it on to, his sons?

Leading people is not easy, but it is also much harder if you do not understand why you have succeeded.

Leading and developing a digital team

I have had the priviledge to attend one of the beter leadership training courses in Sweden. This training course is rather famous in Sweden and is called UGL (Utveckling Grupp Ledarskap). UGL was developed by the swedish military to teach sergants and other decission makers how to understand group dynamics and how to get the most out of your team. After attending this course I have started seeing my team with different eyes.

My reflections touches mainly the power of dynamics between team members and the importance of having a clear path as a leader.
Since the digital space is fast paced and demands your team members to constantly upgrade their competence this puts a lot of stress on you as a team member and leader to be clear, precise and basically all over the place. I also think that a digital manager have to constantly be updated on the general develpment. For example you need to know how mobile affects your business model and how social media is evolving and what all this means for your team and resources.

There are a couple of ways to respond to this as a leader but the most important is seing your collegues as chess pieces. I mean that in the most positive way. As the digital space evolve you want to be strategically placed correctly. Move you team in the right direction. This is of course easier said than done but when you get the thinking you will be in a very good place.

3 takeaways – Working in a non digital company

So, would you say that you work in a digital company? I have now had experience with purely digital companies and non digital companies. With purely digital I mean companies that their entire business model is born in the digital world, like Spotify or Zalando.

There is a big difference working for purely digital companies and companies that try to get into the digital space. As we devolp our digital presence I have found three key difference between the two business models.

  1. Digital businesses are rigged to be digital. Nondigtal have to transform themselves which is a major task. To transform your business is probably one of the hardest parts. Ask Nokia or Kodak. Both giants in their fields with extremely bright people in the organisation but both of them did not manage to transform themselves into the digtial space. To throw money on consultants and technology is not enough which brings me to my next point.
  2. Digital businesses have digital leadership. The leadership have vast knowledge in the power of the technology and the pitfalls. Non digital companies struggle to understand how to take full advantage of technology. The digital landscape is constantly change and the pace is picking up. This means you need to invest heavily in technology and people.
  3. Fast and smart. The bigger the company the more complex everything is and this slows you down. But in the same time if you put your main platform in place you can rigg yourself to be a leader in the market instead of follower. You have to be smart enough to see the major trends consumer adopt. Facebook, Google and Apple are extremly good at this although they are hugh companies with hugh organisations. Non digital organistations have a much slower development cycle since their business has been ”slow”.

Of course digital businesses come and go, so being in the forefront is not a guarantee to survive. A lot also depends on timing but one thing is for sure. The digitalisation of our society touches all businesses, even lotteries.

My experience with mobile phone and tablet optimization

The mobile is a big thing. Let me rephrase it. It is a huge thing. On our swedish Postcodelottery site the traffic from mobile phones and tablets have reached the 50% mark.

This upward trend is a challenge for all of us that work with digital channels since it affects everything from how your design process is to how the technology should be implemented. We are far from cracking the mobile landscape but we are working on it. Currently we are focusing a lot of making things mobile optimized. Our landing page, our sales funnel, our navigation and so on.

Approximately a years ago we launched our responsive site which was a step in the right direction but in all honesty it was done a bit hasty. Now that w have reached the 50% mark a more comprehensive approach needs to be taken. We need to fix stuff so it runs smoothly on mobile devices. A few months ago we did our first mobile only AB test. We tested a mobile friendly landing page vs a non mobile friendly. Unfortunately the test result was inconclusive which is interesting in itself although I cannot draw to many conclusions from just one test.

The second big mobile optimized test was our sales funnel. While changing the plattform we took the oppurtunity to make it more mobile friendly. AB testing a sales funnel is always a sensitive business, but it was done with great care. Unfortunately the results were still inconclusive. In other words the old non mobile friendly sales flow was as good as the mobile friendly. Strange but it can probably be exlained by the super attractie offer we had – no matter how hard you make it for the users they want the offer so they will push through your sales funnel.

So my take on mobile is still shaping. I can see that the trend is more and mobile and the more companies offer a mobile friendly experience the higher the customer expectation will be. To sum it up my key learnings from mobile so far are:

  • Depending on how you do your marketing will determine your mobile traffic volume. The more emails you send out the more mobile traffic.
  • Mobile screen real estate is extremely valuable so you need to prioritize hard which makes it a struggle especially if you have multiple products/services.
  • AB testing for mobile is more complicated than for computers and you need to consider several key factors such as different screen sizes, operating sytems etc.
  • Going forward responsive sites it the future but my limited AB test have so far not given me numbers to support that decission.
  • The big success with mobile optimization will probably come when we develop our mobile offerings further, so the value to the users are more clear.

What are your thoughts?