How To Create Great Culture In Your Small Business

Gallup reported in their most recent engagement survey that employees are feeling increasingly detached from their employers. While large companies have been talking about the relationship between culture and performance for decades, small businesses often fail to think about it as a driver. According to the SBA, small business accounts for almost half of all private sector employees and the vast majority of business as a whole, implying that most businesses in the U.S. have yet to embrace culture as a driver.

If culture drives performance and employee engagement is an indicator of successful culture, then the small business that fails to create a company culture that drives engagement is most likely leaving cash on the table. Creating a strong positive culture isn’t as hard or as costly as you might think, however. It does require intentionality, consistency, and patience to see the result, in your people and on your bottom line.

Develop Core Values That Tell Your Story

This is more than words that you print and hang on the walls around the office. While visual reminders are helpful, memorable, meaningful core values start with a story. If you’ve never created core values for your business, try this exercise. Bring everyone together and ask them to each share two stories. The first story should be one where they were excited about something that happened and were really proud that they worked for the company. The second story should be one where they were disappointed or maybe even considered leaving the company because of what happened. Once everyone has shared their stories and explained why they were impactful to them, group the stories together based on what they have in common. Ideally, there should be 3-5 groups. From there, ask the group to brainstorm memorable words or phrases that capture the value and then finally, pick the best positive story from the group and use it to bring that word or phrase to life.

Once the words and the stories are decided, develop opportunities to educate on them, reinforce their importance in key decisions, and recognize examples where employees bring them to life. This is most valuable when the actions reinforce the meaning and behaviors behind the values in a timely way – early and often is best.

Implement Policies That Are Aligned With Your Culture

Policies is where the rubber meets the road. If you define behavioral norms that are designed to underpin your culture but then fail to codify sanctions and rewards, then your values will lack meaning and will have a negative impact on employee engagement. By way of example, this article from Justworks offers several company policies that positively reinforce a family friendly company culture. While some of these policies may well be out of reach for the small business, creating a behavioral norm where it’s ok to talk about family issues like caring for an elderly parent or going to parent teacher conferences creates psychological safety, greater opportunities for connection at work, and costs nothing to implement. Similarly, a policy around flexible work arrangements is inexpensive to implement and demonstrates that you’re walking the walk as well as talking the talk.

On the other hand, companies that talk about values and fail to create policies that support them are destined to a future of higher employer turnover, lower performance and a slow slide into workplace toxicity. Again, as an example, think about the company that talks about a culture of innovation, teamwork and collaboration and then creates a performance review process that only runs once a year and is used as an opportunity for the manager to enumerate everything that went wrong under the guise of honest feedback and growth opportunities. That negative feedback coupled with a process that is directly tied to salary increases creates anxiety, especially among more junior professionals, and as a result, employees are more likely to search for a new job.

If I have limited resources, what can I do right now?

Honestly, it’s easier than you might think. Start with a conversation around values. In this article on culture in remote organizations, Caitlin Weiser offers suggestions that apply to any small business. Talk about what kind of company you want to be. Also share the current operational and financial limitations up front and your desire to build on your policy and benefit structure as you grow. The conversation itself has value because it gives your people agency. It sets the tone and shows them that they can come to you with issues as they arise. Depending on where the business is at the time, you might not be in a financial position to do something about it but you’ll know that it’s something to address later, and can prioritize accordingly.