By Ian Fuhr, Founder of The Hatch Institute
Johannesburg – South African companies continue to battle the COVID-19 storm and retrenchments, short weeks, and reduced salaries are widespread as businesses attempt to cut costs to stop the bleeding.
Here’s the biggest problem with these survival tactics. The traditional focus on the bottom line and cost-cutting wasn’t working before this pandemic, and COVID-19 has shone a spotlight on the inequalities of our country. If we continue down this path, it will be a race to the bottom. Businesses might survive in the short-term, but the long-term impact of high unemployment rates will erode corporate consumer bases and result in wide-spread unrest.
Instead of focusing on the bottom line, I believe businesses can make a real difference to our economy, country and society as a whole. This change begins with culture-driven leaders who believe that ‘cultureneering’, or focusing on culture first and foremost in an organisation, is the only way to build a future-fit business that is adaptable and able to deliver exceptional customer service. Bear in mind that the customer experience will never be better than the employee experience. The simple reason for this is that you cannot expect people to look after your customers if they don’t have a sense of belonging or feel cared for themselves. And customer service is critical. It builds customer loyalty, which directly increases revenue without requiring costs to be trimmed (or people or salaries to be cut).
Future leaders that are able to navigate the challenges we are all facing will also require a new set of skills that can handle the complexities of our socio, economic and political landscape, which has been devastated by COVID-19.
Culture-focused versus fixating on the bottom line
A bottom-line focus puts profits before people. Culture-focused businesses, on the other hand, always put people before profits. When you focus on profits alone, your perception of people changes – they become cost burdens, instead of value-adding assets. When people are listed as expenses on the income statement, they do not feel inspired to achieve the goals of the company – they see themselves as not very different to any other overhead that can be trimmed or cut when necessary. Culture does not only help the bottom line. Culture is the bottom line!
Commitment, loyalty and customer service will slip fast and furiously when your people don’t have a reason to believe in you, the leadership team, the business or in your purpose.
Everyone has been through an incredibly stressful few months, and we aren’t out of the woods yet. If you really want to build a future-proof business that can navigate this storm, a good starting point is to remind everyone why they come to work – if it’s just for a salary, even now when things are so uncertain, that’s not enough. People come to work to serve the needs and wants of their customers. If they serve them well, the money will follow. Service should always come before rewards and people before profit.
Culture-driven leaders are those that earn the moral authority to lead and have the skills to ‘cultureneer’ their businesses. This means they know how to create a strong culture of service in a diverse and sometimes polarised workforce.
From a leadership perspective, there are a number of things that you can do to earn the moral authority to lead. First, show genuine concern for the well-being of everyone in your organisation. Show a commitment to their development and growth, and create a place of safety where people can speak up if they have any problems or grievances without fear of retaliation.
People need to know that the company is concerned about their physical, mental and financial wellbeing.
In particular, work hard on all the socio-political and diversity elements of the company to make sure that no polarisation or discrimination exists. In the South African context, good race relations and diversity inclusion form an important part of any business culture.
Linking purpose to culture to create service-focused teams
Culture always begins with purpose. We call this the reason for being. Everyone in the organisation, starting from the top, needs to be crystal clear about why the company exists, why we are here, and why we come to work every day. The answers to these questions should always begin and end with meeting and exceeding the needs of the customer – purpose can never be about money because money is the result or reward of achieving your purpose. Everything and everyone should be aligned with your purpose. It should become your guiding light for every decision that gets made.
As the leadership team, it’s your job to instil that purpose throughout the organisation through your core values. However, you cannot state values and then not live by them. You must practice them. Consistency is key – if you are not consistent, you will not win the hearts, minds and respect of your people. If you say one thing and do another, you won’t earn the moral authority to lead and your people won’t follow you. It’s that simple.
In an uncertain COVID-19 world, people are looking for stability and reasons to believe. The culture you build and the consistent message that you share will help them find a sense of belonging, inclusion and common purpose. People naturally want to make a contribution to others and having the right culture of service gives them that ability. The key is to link what they do on a day-to-day basis to a larger purpose.
For example, if someone is on a production line, show them the bigger picture. Who is the customer? What problem are they helping to solve or what joy are they bringing because of the important role they play?
We all need a purpose in our lives, now more than ever.
I’m hopeful that this is the beginning of the next world – a world in which business takes on a more human face. Business leaders have a financial and moral obligation to uplift the people of this country. A narrow focus on profit won’t achieve that, but a culture that puts people first can.