SCORE

By Roger Robinson, Ph.D. Certified Score Mentor

Can an intangible like a company’s culture make a difference in your business? Tough question, right? After all what is culture? Can it impact your company’s bottom line?

Culture first gained a foothold in business through Peters and Waterman’s “In Search of Excellence”. They identified culture as an organization’s strong and sustaining systems of beliefs. Perhaps a simpler way to think about culture is in terms of how an organization makes choices, develops it values, its ethics how it trains, recognizes and rewards its associates, its spirit, and not to be overlooked, how it treats its clients and customers. More simply put, culture is the ideology of the organization.

Clearly this concept sounds good, but does it really mater? Given the nature of various industries, proof is hard to come by. But perhaps there are lessons to be learned. Consider the airline industry. Given high capitol costs of entry and modernization, low profitability, high competiveness, it is not very attractive by Wall Street standards. Especially when compared with the high tech arena. From the point of view of the customer there are many alternatives, loyalty is low and decisions are easy to make.

Company Culture Example from the Airlines

It is hard to be different in the airline industry. Yet one company has been able to differentiate itself from all others – Southwest. Yes, it does feature lower costs and no baggage fees, but it has the lowest operating costs in this industry. Their service is perceived as extraordinary, their on-time ratings are excellent. They have fewer complaints filed against them then any other airline.

The thing that differentiates Southwest from their competitors is their culture – Southwest is a fun place to work and for many a fun airline to fly! They have very low employee turnover. Productivity is high. Pilots have been known to help with luggage ad turnaround if needed. Employees are involved, empowered and rewarded for their performance and innovation. Their culture has made them the most consistent profit performer in this mature, difficult industry. The lesson, focus on the attitude of your associates, how they interact not just with clients and customers, but with each other. What really matters is how you train, treat, trust them, recognize and reward them – how you value them. AS Herb Kelleher, former Southwest CEO, noted in the Wall Street Journal, “You have to recognize that people are still most important. How you treat them determines how they treat people on the outside.” YES, for virtually all organizations culture counts.

About the Author(s)

Roger S. Robinson (1927-2019)

Over a period of 50 years, following the Navy, Roger created and successfully operated a multi-unit entertainment, recreation enterprise in Michigan. During this time frame he was responsible for the entire organization including such activities as strategic planning, marketing, finances, personnel, etc. 

Certified SCORE Mentor, Instructor, Greater Phoenix SCORE