Chapter 3: The Real American Idol Part 8
In the last post, I used the McKinsey 7S model to explain the importance of shared company values to corporate culture. Tom Peters’ book “In Search of Excellence” introduced the 7S model to the broader business community when it was first published in 1982. Peters argues (as do many others) that strong company values give a competitive business advantage. The top companies “create broad, uplifting, shared culture,” which allows them to “ extract extraordinary contributions from very large numbers of people” because they share “ a sense of highly valued purpose.[i]” In other words, when people really believe in what they are doing, they work harder.
This rings true for me. People I interviewed felt that working in the Biotech industry is “motivating in itself” because of the direct connection to improving human health. I was, however, surprised to learn that people in the computer industry find “solving customer problems” to be an analogous type of motivation.
When people described their best work experiences, often they pointed to a time when everyone in the company was aligned around a clear set of goals. Notice the emotion-laden words as a research VP describes her best work experiences.
There were stages in my job where I loved my work. I would get in early, I would stay late, I thoroughly enjoyed it. I thought I was making a contribution and it all felt right to me. I thought about what made it good. I was really clear in my scientific heart we had strengths to address what we were going after. What I knew as my training as a scientist, and the company had resources that really felt like we were aligned with the goals of the company.
Shared values have an additional benefit on the practical level – they facilitate decision making. According to Peters, the Excellent companies did not need detailed procedures because “people way down the line know what they are supposed to do in most situations because the handful of guiding values is crystal clear.” In contrast, Peters sites the difficulty of making decisions at a large company put together by a series of mergers. “The top people are inundated with trivia because there are no cultural norms.” Underperforming companies like this can also have a strong culture, but the focus tends to be on politics or “the numbers,” rather than on people or products.[ii] Peters argues that these companies do not have strong values. I disagree – there are strong values, but the values are pointed in a different direction.
What differentiates the values of the companies classified as Excellent when compared to the lower performing companies? The Excellent companies put people first.
[i] In Search Of Excellence: Lessons From America’s Best-Run Companies. Thomas J Peters and Robert H. Waterman Jr. Harper and Row (1982) p. 51.
[ii] In Search Of Excellence: Lessons From America’s Best-Run Companies. Thomas J Peters and Robert H. Waterman Jr. Harper and Row (1982) p. 76.