When it comes to running a small business, a lot of founders and leaders tend to get caught in the rollercoaster ride towards success. For most leaders, the story is straightforward enough – the company is a passion project, perhaps even their life’s work; a purpose to dedicate almost every waking moment to.
If you’re the founder of a small business, we’d like to remind you that while the company is all that to you, it’s simply a pitstop in everyone else’s careers…right from the moment you interview them, it’s down to you to get them to be passionate about your company’s growth too.
Here’s what Gary Vaynerchuck, CEO of VaynerMedia has to say on small business culture-
“The way to build great culture is not in words that are written on the wall, but in your actions. You have to make every one of your employees and team members understand that you care about them more than you want them to care about you.“
“I know that sounds impossible, but you can’t be crippled by the task. It’s tough. But, if you do it, you will build a great culture. If you do not, every day that you work will take you further and further away from that culture.”
The Importance of Great Small Business Culture
What is a great company culture, really?
The subject and the question are so relative, and so open to interpretation, that the answer almost always varies from company to company.
According to GPTW (Great Place to Work), however, the following six elements make for a positive work culture-
- A sense of community – where everyone sticks together through thick and thin
- Fairness – in terms of equal opportunity, equal pay, and equal recognition
- Trust in management – a leadership team that is credible, personable, and ethical
- Innovation – where everyone has a safe space to express their ideas
- Trust in each other – a place where employees are trusted to be responsible & accountable
- Caring – where the company shows employees how valued they are
Beyond these 6 aspects, we’d ask you to pose the question to yourself–
- What, to you, is a great place to work?
- What are the values you imagine your company culture embodies?
- What do you think will get your employees out of bed, excited to work and eager to grow with you?
Our recommendation- Now is a great time to pause reading and make a list, or even better – a mind map.
Because when you have a great culture, you-
- Raise team morale, and motivate everyone to give their 100%
- Increase productivity and efficiency
- See more teamwork and less workplace politics
- Reduce attrition and see long-term commitment
- Make way for employees to focus on outcomes and growth
The Link Between Great Small Business Culture & Growth
As a small business, your first priority is growth. So, you may look at work culture as a secondary priority – a good-to-have but not a must-have. We’re here to tell you that you can’t have sustained growth without great workplace culture!
This 2015 article by HBR states that “A positive workplace is more successful over time because it increases positive emotions and well-being. This, in turn, improves people’s relationships with each other and amplifies their abilities and their creativity.”
“It buffers against negative experiences such as stress, thus improving employees’ ability to bounce back from challenges and difficulties while bolstering their health. And, it attracts employees, making them more loyal to the leader and to the organization.”
“When organizations develop positive, virtuous cultures, they achieve significantly higher levels of organizational effectiveness — including financial performance, customer satisfaction, productivity, and employee engagement.”
There’s plenty of research to back this up as well. A book by Daniel Denison called ‘Corporate Culture & Organizational Effectiveness‘ published all the way back in 1990, outlines that aligned and engaged employees are essential to establishing an effective organizational culture and to improving performance in the organization.
So how does one build a great small company culture that promotes small business growth? Let’s get right down to it.
5 Tips for Building a Small Business Culture that Fosters Growth
Tip 1- Encourage a Growth Mindset
American psychologist Carol Dweck pioneered the concept of the growth mindset and fixed mindset. According to Dweck, a fixed mindset is a belief that our character, abilities, and talents are static – possessed in a fixed amount, which can’t really be changed.
A growth mindset, on the other hand, is the belief that our character, abilities, and talents can be developed through learning and persistence.
As you can imagine, your mindset sets the tone for how you set goals, work towards them and perceive successes and failures. People with growth mindsets are more likely to spring back from a failure to try again harder, and tend to look at learning as a continuous journey. That’s the kind of people you want working on your team.
When everyone in the company has a growth mindset, everyone collectively works towards desired business outcomes – and improves your chances of success.
Here are a few ways to encourage a growth mindset in your company:
1. Create a Feedback Loop
Instead of pressurizing with a performance review system, try to establish a continuous feedback loop within your company.
When managers work closely with their team members, providing feedback, holding one-on-one meetings, and setting goals together, it helps employees feel like the company is invested in their growth and truly wants them to do better…this, in turn, creates some amount of self-motivation towards growth too.
2. Encourage Vulnerability
When no one’s ready to admit they’re wrong or don’t know something, there’s no natural environment for learning. As a leader, freely admit when you don’t know something and look at it as a learning opportunity, so your employees feel free to be vulnerable too.
This creates an environment of trust, and the feeling that everyone is there to support each other and learn from each other.
3. Train Your Mid-Level Leaders to Recognize a Growth Mindset
You may not be able to closely interact with all employees every day, certainly not enough to know their mindset – this is where mid-level managers play such an important role.
Consider them your gatekeepers in ensuring that the company mantra of having a growth mindset is strong in their team members. If someone’s feeling stagnated or stuck, they’ll be the first to know and help.
Tip 2- Focus on Continuous Learning
Small business culture is usually all about personal and professional growth. In fact, the reason why most people prefer to work with large conglomerates rather than small businesses is the learning and development opportunities (and organizational stability).
While the growth mindset is more about being internally-motivated to learn at every opportunity, you need to also create a learning & development program that will help your employees advance in their careers.
It’s a win-win situation: employees feel motivated, they feel like you care about their growth and careers, and they apply all the learnings back to your company, creating growth and advancement for you.
Investing in the advancement of your employees = the advancement of your company.
A few avenues of continuous learning include-
- Internal training sessions– team-level and company-wide
- External training sessions– led by experts within the field
- Online courses/MOOCs– from platforms such as Coursera or EdX
- A book club– choosing one business book in a relevant area
- Peer training– where employees share learnings with their colleague
When implementing a Learning & Development program, we recommend-
1. Getting Everyone Involved
If it’s just you and HR doing all the planning, everyone else won’t really feel like sticking with the execution. With an L&D program, one of your biggest hurdles is going to be getting people to stick with it enthusiastically.
It’s easier to do that when they’re invested in it from the beginning. Send surveys to choose courses, create a core committee of mid-management leaders, or perhaps a core committee of learning champions from different teams.
2. Going Down to Individual-level Planning
Different employees – even at the same level – have different areas of growth. One way to map out everyone’s strengths and areas of learning is to create a competency matrix, and then map everyone’s current competencies against it. This will highlight the gaps and different areas of growth down to the individual level. This will also feel more personal for your employees!
3. Planning Based on High-level Goals
Once you’ve identified company goals, you can easily use the competency matrix (Download the Template) to identify the courses that employees should be taking. Keeping your L&D program in line with business goals helps the company grow in one direction, toward a larger vision.
4. Creating Accountability
Set up check-ins along the way, reward people for completing the program successfully, and observe the impact on daily executed work. The goal of a Learning & Development program is to help employees upskill and raise the collective competency, so while you may not be able to objectively measure impact, you can observe the quality of work.
Tip 3- Encourage Experimentation
Failure is not the opposite of success; it’s part of success. – Arianna Huffington
A lot of leaders advocate experimentation as a stepping stone to small business growth. The idea being that if you aren’t trying to find newer, better ways to get greater outcomes, you’re stagnating while everyone else rushes ahead of you.
Experimentation also leads to unexpected outcomes – you never know where you’ll find success. When we recommend experimentation, we recommend it at every level, as in intrinsic part of your culture.
- Bring experimentation into your marketing – A/B testing different approaches to campaigns
- Bring experimentation into sales – creating test and control groups out of different cohorts
- You can even bring experimentation into the way you hold meetings – identifying more productive techniques and approaches.
In order to make experimentation a part of your work culture, you need to take care of a few things first:
1. Make “Experimentation” Part of Your Company Values
Encourage the belief that trying, testing and failing is a great way to do business. Consider it a value when you’re hiring people, and consider it a value when you think about whether your employees are in sync with your culture. For it to work, it needs to be deeply ingrained – people need to be ready to try something new, fail and get up to try something else.
2. Make Time for it
Experimentation & innovation doesn’t happen in a culture that’s rushed for time and focused on performance. Innovation takes place after employees have been given the opportunity and time to fail a few times and keep trying anyway.
3. Encourage Collective Responsibility
For successful experimentation, people need to work together as a team, and more importantly, different teams need to work together seamlessly. Working in silos, putting your head down and getting down to it, and keeping data to yourself just doesn’t work.
Before you make experimentation part of your culture, figure out how to break down any metaphorical walls with the help of your mid-level managers.
Tip 4- Create ‘Leaders as Coaches’ Within the Company
As a small business owner, you may have a business coach that helps you work towards being your personal and professional best. As a coachee, one of the most productive outcomes you can create is to mentor your direct reports and help them, in turn, become coaches for their reports. Creating this coaching culture within the company creates a growth mindset, provides tools for growth and creates accountability.
A Gallup report on re-engineering performance management outlines the cycle of coaching with 3 elements (read it in detail for a great guideline to navigating the cycle!)-
The report suggests that when these 3 elements are ‘strengths-based’ and ‘engagement-focused’, performance development truly comes into play.
It states, “Strengths-based coaching teaches managers to understand how employees are innately wired to think and what they naturally do best on the job. Engagement-focused coaching teaches managers to understand employees’ performance needs and barriers to success.”
“Only through an appreciation of both who employees are as people and what they need to be engaged can a manager effectively coach them to be their best.”
Here’s how to teach your reports to provide strengths-based and engagement-focused coaching-
- They need to focus on each team member’s strengths – The idea behind strength-based coaching is that strengths should be encouraged and honed, and weaknesses should be managed.
- They need to radiate positivity – The role of the leader-as-a-coach in strengths-based training is to spend review meetings focused on right vs what’s wrong, and to address weaknesses with a plan.
- They should use employee strengths to improve engagement – The more one is good at something, the more they want to learn and be engaged – it’s human nature. Leaders-as-coaches should leverage this to create new avenues for growth & accountability.
A great place to get started is to get your leaders-as-coaches to run a feedback survey or a tool-based assessment to identify areas of strengths and weaknesses for all employees!
Tips 5- Hire the Right People
We’ve saved the best for the last. Hiring isn’t just about filling a requirement. When you hire someone, skill and experience is only part of the consideration – the more important part, if you ask us, is whether that person fits into your culture (or the culture you’re trying to create).
You can help people upskill and get better at their jobs, but you can’t really change their beliefs and personalities – if they don’t fit into your culture, it’s not just that they’re a bad fit for you, your company is a bad fit for them.
Eventually, that’s going to lead to all kinds of problems such as extreme dissent, workplace politics and ultimately, higher attrition rates.
Allow us to share some tips for hiring the right people for your small business culture-
1. Hire with Clarity
Before your HR team goes looking up potential candidates, the hiring manager needs to have complete clarity about the kind of professional they need on the team. Do they need someone senior or junior? What skills/attributes are must-haves? What traits and beliefs are must-haves for them to fit into your culture? The more clarity you have, the easier it is to hire the right person.
2. Use the Right Channels
You can’t pin all your hiring hopes on one channel. The talent you’re looking for is probably present across a number of places, so you need to be too. We recommend job portals, social media, your website, educational institutes and, most effectively, word of mouth.
3. Have a Hiring Process
Think about how many rounds of interviews you’ll have, what the evaluation parameters should be, and create a standardized feedback/evaluation form for the interviewers to fill. Make sure you also think through details such as assignments to be given out, maximum turnaround times, etc., so you can create a smoother process for both, the hiring manager as well as the prospective employee.
4. Verify the Information You Get
You don’t need to take the prospect’s word for everything they say – that’s what background checks are for. Have your Talent Acquisition or HR team vet claims made by the prospective employee but getting in touch with the given references.
5. Use Tools Where Needed
Culture assessment tools are a great idea to determine whether each prospective candidate is a good fit for your company. We’d leave the culture assessment test early on in the hiring process, so it can help you quickly shortlist a more ideal pool of candidates.
We’d like to wrap up by pointing out that while we listed out the 5 practices, we’ve personally vetted, there are many cultural best practices for small business growth.
Like we said earlier in this post, it should all begin from the small business culture you envision your company to have. Once you have enough clarity, there are plenty of guidelines to get you there!
If you know any other effective tips to cultivate a small business culture that fosters growth, we’re all ears (or eyes, as the case may be). Please reach out to us in the comments section below!