Company culture is something of a catchphrase in the industry these days. Everyone, including many of our contributors, seems to agree that whether your company culture is strong or weak, it influences employees' behavior and all of their day-to-day decisions.

Mark Robert Halper

How strong is that influence? That's the subject of a recent article in the Harvard Business Review (May 2005). The authors, Thomas Kell and Gregory T. Carrott, are both senior partners at Heidrick & Struggles, whose Executive Assessment Practice recently analyzed thousands of executives in more than 100 corporations.

One conclusion was that company culture affects employee leadership styles more than any other aspect of their job. In fact, when it comes to leadership style (defined as how people learn, deduce, envision, engage, and execute), the study found that employees working for the same company, regardless of their jobs, were 30% more likely to show similar leadership styles than people doing the same jobs but working at different companies.

“Consider, for example, an American engineer employed by Honda,” Kell and Carrott write. “The fact that she works for Honda tells you more about her leadership competencies than the fact that she is an engineer or that she labors in the auto industry or that she is American. What's more, her competencies will probably more closely resemble those of a Japanese comptroller at Honda than those of an American engineer at Ford.”

The subjects of this study were employees of large corporations, and I can't say for sure that results would be as dramatic for small remodeling companies. But the basic conclusion — that company culture is the strongest influence on employee behavior —has far-reaching consequences for remodelers of all sizes.

Most obviously, it affects hiring decisions. Every time you hire for attitude and train aptitude, you are reinforcing your company culture, good or bad. On the flip side, you may also experience less tolerance for employees whose styles diverge from the norm. That means you may not get as much diversity of opinion on policy issues or be able to expand as easily into new markets.

When it comes to leadership positions, it may also affect whether you hire from within or from outside your company. Kell and Carrott note that it's possible to change your company's culture, but that the best strategy for doing so is to “continually [hire] people who represent the direction you are headed.”

Peer Review The strength of company culture also suggests, in a back-door kind of way, why peer review groups are so valuable for remodelers. By interacting with other companies, you encounter diverse company cultures. The variety of leadership styles provides the kind of insight into your strengths and weaknesses that are difficult to see just by looking inward. After all, when you're looking to your own employees for insight, what you see is your company culture reflected back at you.

The kind of diversity you experience in a peer review group is also present in industry associations. And it's part of the attraction of industry events, like our Remodeling Show or our Leadership Conference. Exchanging ideas with remodelers who have the same problems as you do helps you to break out of ineffective patterns of thought and behavior. Without the diversity of opinion and experience, your company culture would tend continually to reinforce itself.

I'm all for systems and standardization, and for building a company culture. But it's worth keeping in mind that the coin has two sides. Today's market puts a premium on the ability to adapt and change. Is your company culture moving you forward or holding you back?
Editorial Director