LEADERSHIP, CULTURE AND THE BUSINESS CODE

At the heart of complexity lives simplicity.

Aligning a business, company, or team requires a clear and constant focus, continuous effort, and all the skills necessary to be a great leader today and tomorrow. Members of organizations and teams must be more engaged and committed than ever before. For this, they need as much information and development as their leaders do. Every member of every team or company has a role in ensuring that alignment exists.

The Business Code is a framework for alignment that can be applied to any organization or team, regardless of size. There are four elements to the Business Code: the customer, brand intention, culture, and leadership.

LEADERSHIP AND CULTURE

Among a leader’s many responsibilities, none is as powerful and integral to success as understanding culture. Therefore, the leader’s behavior must be in alignment with the culture’s expectations.

Without this, it is virtually impossible to create and lead an aligned organization or team. As complex as the study of leadership is, the most straightforward definition of leadership is influencing others to act. Leaders are responsible for acting in a manner that clearly conveys how the intention of the business is implemented and ultimately how the customer is treated.

To influence culture, leaders primarily do three things.

  • They role model acceptable behaviors, which define how individual and group success are achieved;
  • They reinforce what is acceptable and unacceptable behavior, and
  • They represent the reputation of the culture.

These basic aspects of aligned leadership are not to be taken lightly. The influence a leader has, formally and informally, can easily be undermined when a leader’s behavior is misaligned.

Aligning natural preferences to group strategies

Another aspect of a leader’s influence that is often overlooked is how well aligned the leader’s natural preference is to the strategies the group is undertaking. The way we behave comes from our psychological makeup and preferences. How we are wired directly impacts how we think strategically, as well as how we relate to the customer experience. This preference guides our beliefs about what, why, and how a product or service is offered and delivered to the customer.

The customer ultimately experiences the preferences of the leader. You don’t have to look hard to find examples. Just consider Henry Ford, Oprah Winfrey, Bill Gates, Indra Nooyi, Richard Branson, Steve Jobs, Warren Buffet, Steve Wynn, Walt Disney, and Mark Zuckerberg. Each demonstrates their personal preference in how they lead, as well as the market strategies and brand intentions they pursue.

STARBUCKS: AN EXAMPLE OF LEADERSHIP AND CULTURE

Consider the example of Howard Schultz, the CEO of Starbucks. Schultz believes that connecting to and caring for people is paramount to success. This not only extends to the strategies for how Starbucks engages its customers; it is also evident in the company’s human resource strategies.

Schultz was born and raised in the Bronx, New York, where his family lived in a housing project. He often refers to his father, who struggled in low-paying jobs and had little money, no health insurance, and no workers’ compensation insurance when he got hurt on the job. In Starbucks, Schultz set out to build a company in which employees would be respected and well cared for. While the company’s main goal was to serve a great cup of coffee and to connect and care for its customers, Schultz said he wanted to build a “company with a soul.”

Schultz’s values and preferences resulted in a set of practices that are uncommon in retail businesses. Employees working at least 20 hours per week receive comprehensive health coverage for themselves and their families, as do unmarried couples. Along with stock option plans, employees are given a great deal of personal responsibility and treated with the respect that Schultz thought his father deserved and hadn’t received. How employees are treated by supervisors and the benefits they receive result in high loyalty and lower turnover.

These innovations come from Schultz’s life experience and personal preferences.

They are evident in the company’s strategies, including, in the early stages of the company’s growth, never to franchise. This decision avoided any possible dilution of, or variations in, the company’s culture and assured consistency in how both customers and employees are treated. In the case of Schultz and Starbucks, the alignment of a leader to the company’s market strategy and culture is apparent. The influence of his leadership on the organization’s performance is difficult to debate, and his reputation as a leader is undeniable. In 2011, he was named Fortune Magazine’s Businessperson of the Year.

 

Edgar Papke is the co-author of Innovation By Design and author of True Alignment and The Elephant In The Boardroom. He helps leaders and their organizations align to create greater levels of innovation, performance, and fulfillment. He can be reached by email: edgar@edgarpapke.com

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