Many factors influence the profitability levels of a company. In this case, the potential impact of a single element is of interest: the company culture. For many companies, improving profitability consists of sweating the shirt, dedicating more hours of daily work, putting a prize on productivity, implementing a performance evaluation system, etc., somewhat traumatic paths for any organization. To achieve this superior profitability and do it in a healthy way, you must lead rationally: use new techniques and tools for teamwork, lower levels of responsibility and decision, share information and implement management systems for improvements and recognition.
This rationality is built from the foundations of the organization: the shared values that it promotes, the Mission and Vision, are issues without which it is difficult to design and transmit policies and strategies to others. These, in turn, will serve to align attitudes, behaviors, and clearly and precisely guide the people who make up the organization, towards the achievement of objectives. In practice, a short questionnaire can give an idea of what is done:
In almost every company there are managers of Finance, Purchasing, Production, HR, etc. But who is responsible for:
- Evaluate, develop and distribute the creative potential?
- Knowledge management?
- Develop a leadership system capable of harnessing people's ideas to produce small improvements every day?
- Know the development needs of each person in the company?
- Evaluate if the necessary "players" are in the right place to win this difficult game?
- Determine the necessary skills for the above?
Also:
- Is time and the appropriate place allotted to address the inherent problems of the job and their solutions?
- Is the work environment measured, and is something done to improve it?
- Are the organizational culture and leadership system capable of fluidly allowing and promoting all of the above?
And regarding personnel:
- Does each of them know what is expected of him?
- Is it explained what it is for and the importance of the result of what it does?
- Are you informed about the results of your process?
- If there is a deviation in the process, can you and know what to do to correct it? Are you trained for that?
- Are the achievements of the objectives recognized by the company?
Implementing these changes implies a new role for directors, managers, supervisors, and employees. From giving orders to attend, from saving to sharing information, from demanding to educate and from operating a machine to managing a process. This is demonstrated by excellent global companies, which produce good results for their shareholders, even in times of crisis, as well as keeping their staff motivated. An equation difficult to achieve, but possible.
It is worth mentioning, even if very briefly, the conclusions of the research studies carried out over 11 years by professors Kotter and Heskett of the Harvard University Business School in more than 200 companies, about the relationship between business culture and profitability:
1) Culture has important repercussions on long-term profitability, in those companies that emphasize key management factors such as customers, shareholders and employees, and in leadership development at all levels.
2) It is highly probable that the culture of the companies will be, in the next 10 years, the most important factor among those that determine their success or failure.
3) Although they resist it, the cultures of the companies can be modified so that they become a factor that enhances profitability. It takes time and the presence of strong leadership.
The aspects covered are not more important and more durable than profitability, simply, it is what determines it.
