“Why Culture is so Important to Small Business Success”

Dave Schoenbeck

The simple fact is, a carefully cultivated culture is one of the most important components of success for a small business. Many businesses have amazing business models. Many businesses have brilliant strategic plans. Very few have the combination of a business model, strategic plan and a compelling culture. When the three are combined, success is almost guaranteed. I remember reading a great quote “culture eats strategy for lunch”. I believe that this is true and here are a couple of examples to prove my point.

Tony Hsieh, the founder and CEO of Zappos.com, is an inspirational leader that understands why culture is important to small business success. A few years ago I had the opportunity to visit their ecommerce headquarters in Las Vegas and it was amazing. Every associate that I met was a walking and talking billboard for the company. They spoke of their personal development program, the extended recruiting and orientation program for new people, and their personal belief in the mission of the company. I saw their real-time key performance indicators publicly displayed for all to view. I saw their personally customized workspaces. I saw their learning library. I saw and heard conversations with customers that was friendly and helpful beyond my expectations. I felt a unique vibe from all that I met that was genuine. Zappos has a great business model and a great strategy but they have an amazing culture that will propel their small business success for years.

When I graduated from college I went to work for midwestern regional drugstore retail chain that had aspirations to become a national powerhouse. The products that we sold were widely available from many other retailers so the points of differentiation was exceptional service, a wider assortment of products, and real estate convenience. In the end, our service advantage was the real difference and it was developed over years of fostering an incredible depth of managerial talent. The leadership of our company was exceptionally careful to hire skilled and passionate people and invested in their development by frequent rotation through different functional jobs. Our executives were long tenured experts that truly cared about their people and investing in the success of the next generation leaders. There was very little voluntary turnover because we believed in the company, the leadership, the mission, and the future. The middle and frontline management of this business became powerful emissary’s for the style and techniques of satisfying the customer. The culture was pervasive, palpable, and lasted over 60 years. Even today, retired executives stay active in mentoring their younger students and luckily I am one of them. The customer and associate culture was clearly the difference in our small business success and I have been permanently shaped by that experience.

Why Culture is so Important to Small Business Success

If you want to fully develop your small business culture, consider this list of ideas:

Hire only people who fit: Understand what the success profile is for your employees. Clearly define their needed skills, capabilities, and most importantly what their beliefs should be. Those beliefs should be in concert with the body of your team and will ensure your small business success.

Reinforce with cultural touchstones: Develop rituals, events, and processes that consistently reinforce the mission and values of your business culture.

Shared belief alignment: Write out your mission, vision, and rules of the game for your team. You must work hard to keep everyone aligned to the culture that you have dreamed.

Clearly define expectations: Your team will conform and endorse your cultural expectations if they are clear, well defined, and are frequently reinforced. Small business success revolves around your team understanding what you expect for your culture.

Trust and empower: Empowered employees leverage the power of your culture. Think about the power of your entire team if they all treat your clients the way you would.

Lead by example: The CEO/Owner is the chief cultural officer. You set the tone and you have the best chance to ensure that others will follow your lead.

Include everyone: Culture spreads when everyone is informed, involved, and held accountable for driving it forward.

Keep it small: As your business grows, do everything possible to keep your business small. Said another way, remember how impactful and efficient it was to communicate when your team was small. Break down your bigger teams so that you can have one-on-one cultural connections with smaller teams.

I have had the fortune of working for decades in several outstanding businesses with great cultures. I have learned from masterful, powerful, leaders that understood that their business competitive advantage started with a tenacious devotion to nurturing a culture that lives beyond the physical presence of the founders. A strong culture can hollow-out a unique place in the market that creates and drives market share, sales, and profits.

So at the beginning of this article I asked the question…”why is culture so important to small business success?”. It is really pretty simple. Without a strong culture in your business, you will probably not prosper. To me, that should be a powerful incentive for you to invest in doing whatever you can to redefine and improve your culture today.

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