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How to build an 'All In' corporate culture

Nancy Weil | April 30, 2012
In recent years, consultants Adrian Gostick and Chester Elton kept hearing the same lament from corporate clients: "It we can't get our culture right, nothing works."

In recent years, consultants Adrian Gostick and Chester Elton kept hearing the same lament from corporate clients: "It we can't get our culture right, nothing works."

The longtime partners and collaborators, who specialize in employee recognition, teamwork and culture, had long ago identified keys to building teams whose success could generate such strong momentum as to transform entire organizations. They wrote about those strategies in "The Orange Revolution," a follow-up to their bestseller "The Carrot Principle," which focused on how the best managers use recognition to keep employees motivated and dedicated. They backed their strategies with research involving hundreds of thousands of employees at a wide range of companies.

They have built an impressive file of corporate case studies that demonstrate the keys to workplace success. "Zappos is one we had written about before they were even cool," Gostick said in an interview. "The teams know exactly how to make the culture work for their team. There are some nuances, but the teams are part of a big, structured organization, and the culture is clear. The problem is that most of us find ourselves in places that aren't as clear. The team leaders think that the culture is defined, but it's just not. So what we find are these oases of culture and teams in sometimes dysfunctional organizations."

So, the two set out to pin down strategies for creating the sort of culture that demonstrably works the best. The result is their latest book, "All In: How the Best Managers Create a Culture of Belief and Drive Big Results." Published recently by Free Press, the book has hit the New York Times, Wall Street Journal and USA Today bestseller lists. In it, Gostick and Elton offer a seven-step road map for creating a successful culture, as well as a quiz to determine if a work culture is dysfunctional and a list of 52 ways to get employees to be "all in."

They worked with Towers Watson to analyze a 300,000-person study involving 25 high-performing companies, which helped them identify the traits of workplace cultures where employees believe in their leaders, but also understand and work for the company's mission, values and goals. Employees at such companies exhibit what Gostick and Elton call "the three Es": they are engaged, enabled and energized. Particularly notable is that the study was conducted during the height of the global recession and yet when financial data from a pool of 50 global companies was studied, those that displayed high levels of the three Es also had average annual operating margins of 27.4 percent.

The operating margin is the percentage of sales left after a company pays wages and for raw materials and other costs, and, as they note in their book, "operating margins above 27 percent are rare and worthy of exploration. They indicate efficiently run organizations, but also ones where customers are willing to pay a premium for their services." The Towers Watson study further found that the 27.4 percent annual average was nearly three times higher than the 9.9 percent achieved by companies found to have low employee engagement, and that companies identified as having high employee engagement came in at 14.3 percent. Clearly, the other two Es of enabling employees, in part by empowering them to make their own decisions, and finding ways to keep them energized, make an enormous difference.

 

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