The Importance of Culture

One of my favorite CEOs is Tony Hsieh of Zappos.com. He's implemented so many novel business practices (ex., all employees encouraged to use Twitter, pays new hires to quit to ensure that they REALLY want to work in Zappos, publishes an un-censored Zappos culture book, etc.) and yet remains down-to-earth. So when he recently recommended at an Entrepreneurs' Organization conference that everyone read Tribal Leadership, I made sure to listen. Hsieh is so passionate about this book that he gives away a free audio download version on the Zappos.com website.

The book relies, in part, on two premises. First, 70 percent of all business strategies fail and, second, that culture always trumps strategy. So if culture beats out strategy, then businesses should be more focused on improving their culture rather than engaging in team-building exercises or devising new strategies. 

Authors Dave Logan, John King and Halee Fischer-Wright then go on to explain the five types of cultures, and their respective cores values, moods and themes.

What I really liked about the book is the easy-to-understand way it explains how the five different tribe models work, and the language used in each tribe to help you identify its stage. 

The authors explain that most companies are in Stage Three, also known as the useful stage. In this stage you have a hub and spoke organization with the hub giving orders and the spokes obeying. While effective, it can be stressful and lead to employee burn-out. It requires the hub to be a control freak, and is limited in that the hub can only "supervise" a certain number of spokes. 

The authors build a strong case for moving your organization to Stage Four, the important stage. In this stage, there is no one team member through which everything must run. You have a stable, more natural partnership where everyone is connected, and shares a common purpose. In this culture, work flows effortless and the group is “we-focused”. 

Given the book's focus on culture, it is no wonder that Hsieh is a big fan. In fact, Hsieh instituted a policy that 50 percent of Zappos.com's hiring and promoting decisions are based on how employees fit within the Zappos culture.

Having read the book, I still have questions about how to move my company from Stage Three to Four.  I am therefore glad that the New York Enterprise Report is bringing John King, one of Tribal Leadership's authors, to New York on September 13th for a keynote event.

Look for me in the front row!