Posted: 28/04/2014 3:06:06 PM by
The business culture of a company is simply the way they go about their business. It reflects the true values and priorities to which the company works. It is how they make and implement their business decisions.
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In most businesses the culture is formed around the personalities of the business founders. In the majority of organisations the culture is not designed or structured, but just left to grow organically. In every case it is the leaders in the business that shape the culture.
“The way things are done around here” is much more powerful than what is written in a policy and procedures manual. It is the things that are usually unwritten and unspoken. It is the underlying values, communication style, and priorities that are repeatedly displayed through the behaviours and interactions of the people in the business.
This is important because the performance of any organisation will always be driven by those behaviours and interactions. An organisations reputation gives an insight into the culture within it.
I will confidently predict that the organisations leading the Corporate Reputation Index have a company culture that has not been left to chance. The culture will have been engineered based on clarity of a business purpose and values to support that purpose. It has been a key part of their success. Their reputation is strong because, in most cases, the things they do, why they do them, and the way they do them, completely align. I will also confidently predict that their financial performance is higher than their industry peers.
According to Marketing Magazine the companies that suffered losses of corporate reputation in 2014 compared to previous years included two Australian icons; GM Holden, and Qantas. Both companies have faced difficult decisions in the past year, but that alone is not the reason for their loss of reputation. For example, Toyota has also made the decision to end local vehicle production, but they remain in the top 5 in the 2014 ranking.
It is likely that people viewed the Holden “we’re here to stay’ advertising campaign as highly cynical. Equally, the Qantas announcement to cut Australian jobs goes against their “spirit of Australia” tagline. There are inconsistencies between why they exist, what they’ve said, and what they’ve done. Their behaviours and interactions have not supported their brand values.
We see companies spend huge amounts of money on advertising and marketing. Yet too often we also see that investment undermined by a culture that is incompatible with the marketing and advertising messages. This dissolves reputation and destroys business value.