This article first appeared in CityAM.
What determines whether a business will be successful? Some would say that it’s all about the product or the idea. Others might think it’s down to strategy and execution.
While these things are important, competitors can — and often will — catch up.
The only long-term advantage a business has, the only truly defensible strategy, is its culture. But what exactly is work culture?
Culture is not what a company claims loudly about itself. It’s about how its people behave.
The big six energy companies are perfect examples. Their websites talk endlessly about trust and putting customers first, but a quick look at Trustpilot will give you a very different picture.
Rather than grand claims, culture is about the little things. It’s the actions of every single person, every single day.
The chief executive is the starting point for corporate culture, acting as the ultimate role model. Take the Enron scandal as an example. With a chief executive motivated by short-term financial gain, a toxic culture was born. Had the culture been more customer-focused, Enron may have continued to prosper.
With that said, it’s increasingly difficult to maintain culture as a business grows. So I think of the chief executive as being an antibody against cultural decline.
In the early days of a business, it’s relatively easy to set the tone. You might have a team of 20 people all working together in one room. The sense of shared purpose will be clear and your customers are, naturally, your sole focus. This gives you an edge over your larger rivals.
Fast forward a few years and, if things go well, you might find yourself running a company of 1,000 people across different offices, cities, and perhaps even continents. When it gets to that point, it’s unlikely that you will have met all of your colleagues.
You may sense that not everyone cares about the customer like they used to, and the competitive advantage starts to slip away.
As chief executive, it’s your job to minimise this cultural decline. Hiring is one area where you can make a difference. But chances are that you’ll get it wrong sometimes.
I belatedly learned that you can teach functional ability, but you can’t teach cultural fit. And a bad cultural fit can really damage what you’ve built.
By contrast, when you find people who live and breathe your culture, you should do everything you can to keep hold of them.
If you are the chief antibody, these people are your deputies. Make your company a great place to work, where people can thrive and are rewarded for their loyalty. And don’t be afraid to do things differently.
As an example, after eight years’ service at Octopus, we offer a paid sabbatical and commission a portrait as any character the staff member chooses. I feature alongside my co-founder Chris in Grant Wood’s American Gothic. It’s as weird as it sounds. Although my personal favourite is Paul, one of our managing directors, who opted to be portrayed as the Queen. He will do anything for a bit of attention.
When you get the culture right, the pay-off is huge.
My favourite story is from a colleague in our investment business. David was on the phone to a customer and offered to send him a brochure, but the customer said he was blind, so told David not to worry. That night, David went home and recorded himself reading the entire brochure, then sent it to the customer the following day. No one told David to do it, he just did it because it was the right thing to do.
Building and protecting a culture that creates moments like this is fundamental to my role as chief executive. It’s why I get up and come to work every morning.