Thursday, November 17, 2011

Corporate culture; what does it say about your company?

Christopher Ramey

Culture at a company (corporate culture) is generally developed through the actions of management.  Employees then follow their lead.  “The boss did it this way so it must be the right way.” I share this obvious observation because sometimes leaders do things that ultimately reflect poorly on the company.  This is particularly so during difficult times.

One of the benefits of working with dozens of companies outside the flooring industry is the opportunity to understand their corporate standards and culture by observation.  I recently spoke at a convention for a couple hundred people.  The food was acceptable as you would expect; but the room was dirty and hideous.  The company chose this room because it was the least expensive room available.  The room was so remote and old that most of us didn’t even know that wing of the well-known property existed.  We sat in a dirty room that communicated the company’s own low standards while the corporate president spoke glowingly about their commitment to standards and growth.  It was another sales meeting where I was hired to present a motivation and informative presentation on selling to the affluent.  No small task when my feet kept sticking to the very old carpet.  They saved a few dollars but undermined the reason for the meeting.   

I recently reached out to an executive at one of the big three carpet manufacturers.  He called me back within 24 work hours.  He then continued to return my call until we connected.  I assume because he is a high level leader that his professionalism reflects their corporate culture.  I was impressed.  On the other hand, I recently called a mid-level executive at another major flooring manufacturer three times.  I also emailed him.  He never responded.  I need not mention the organization as I understand from colleagues that everyone in the industry will know the company to which I refer.  I have also been informed that arrogance and dislike for their customers is part of their corporate culture. It shows.

I worked at a company where the CEO set the standard that executives would return phone calls within 24 hours – regardless of who it was calling.  It was his own personal standard that he, as one of the leaders of the organization, believed to be important.  It was part of the culture.  

In college I was writing a report on Jerry Della Femina.  A little background: in the 1970’s Jerry Della Femina was an icon in the marketing and advertising industry.  His book “From those Wonderful Folks Who Brought You Pearl Harbor” was a staple on my dresser for years.  Unlike the other students writing reports on other advertising agencies, I called Mr. Della Femina on the phone to interview him.  Shockingly, he took my call!  Once I got over the fact that he swore more than my fraternity brothers, he taught me that helping college students was part of his culture.  It’s become part of my culture too.  And, I’ve been one of Della Femina’s followers ever since.        

Arnold Kahn, from Crystal Tree Carpet & Flooring in Palm Beach Gardens, tells the story about a salesperson who increased the price on a product because he could.  Arnold corrected the salesperson and then credited the customer.  After all, it was his company’s customer.  I mention this because I recently needed flooring for one of my clients who opened an office on Palm Beach.  I called Arnold who sent me pictures from a cell phone.  Within five minutes the client chose one of two products and ordered by phone.  The cost for the carpet was ~$7.00/square foot – not inexpensive.  Price was never an issue because I already understood Arnold’s culture.  I was buying Arnold’s established culture of integrity.  I didn’t need to ask about price.        

I recently worked closely with an organization of affluent homeowners.  The merchants in the community can become a sponsor of the organization for $250.  Not one retail merchant is a sponsor of this organization comprised of their best prospects.  The retailers will advertise and support their own business association, but miss the opportunity to support what really matters to their clients and best prospects. 
The moral of these stories is simple.  Leaders create their culture.  Regardless of what you say; your real feelings are transparent and are imitated by those around you.  It becomes clear when you don’t like your customers, as well as when you value your customers.

What about your company?  Are your employees emulating your actions?  Are they making short-sighted decisions because they’re following your lead to maximize profits rather than your future?  
Which leads to my final question.  Are you marketing and communicating your price or your culture?  And which do you believe really matters?


This post is an extract of Chris Ramey's upcoming book "Ramey's Rules of Retail."

Chris Ramey is president of Affluent Insights and a member of the Floor Covering Institute.

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