Reading corporate culture from the outside

Culture eats strategy for breakfast, runs the aphorism. It also projectile vomits employees who don’t fit in. In a survey conducted earlier this year by Flexjobs, an employment site, culture was the most common reason people gave for quitting. And it matters more than high wages. A study published last year by Jason Sockin of the University of Pennsylvania found that workers rated things like respectfulness, work-life balance and morale as more important to job satisfaction than pay.

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The problem is that culture can be very hard to fathom from the outside. It resides in quotidian interactions between colleagues and in the hidden threads that bind decisions on everything from promotions to product development. You need to be inside an organisation to really understand it. But more sunlight is getting in. Firms are doing more to signal what they stand for. Jobseekers have new ways to peer inside firms. So do investors, who share their interest in evaluating corporate culture.

Offices are places where culture can be transmitted osmotically. Now that more workers are remote, firms increasingly write down their values. Qualtrics, a software firm, may not believe in grammar but it does believe in Transparent, All in, Customer obsessed, One team and Scrappy. Justworks, an hr technology firm, subscribes to Camaraderie, Openness, Grit, Integrity and Simplicity. Lists like these can turn blandness into an art form, and are overly determined by what will create an acronym. They may not reflect what actually happens inside the company. Plenty of firms are characterised by Cluelessness, Rancour, Amateurism, Skiving and Stupidity, but you won’t find that on the website.

But companies that codify their values are at least thinking about them. And their choices can offer meaningful clues. Kraken, a cryptocurrency exchange, sets out its beliefs in ten “Tentaclemandments”. You need to see only that one word to know whether this is the workplace for you or whether you would rather be hurled into an active volcano.

Updates can also be instructive. In “ReCulturing”, a new book, Melissa Daimler lays out some of the changes that Dara Khosrowshahi made when he became ceo of Uber in 2017. The values of the previous regime, which included “Superpumped” and “Always be Hustlin’”, were overhauled for something a little less hormonal. The change from “Meritocracy and toe-stepping” to “We value ideas over hierarchy” told people something useful about the aspirations of the new leadership team.

Culture is increasingly readable in other ways, too. Since the pandemic, firms’ policies on remote working have given outsiders greater clarity on how employers view issues like work-life balance. Under increasing pressure from employees to take stances, companies are likelier to offer opinions on political and social issues. Others go the other way: Coinbase, another crypto firm, has made it clear that it won’t tolerate employee activism on subjects unrelated to its core mission. That’s information, too.

Windows on cultural norms are being opened by regulators, who are pushing for greater disclosure about firms’ workforces. Candidates seem to value this kind of information: a working paper published earlier this year by Jung Ho Choi of Stanford Graduate School of Business and his co-authors found that clickthrough rates for job postings rose for firms with higher diversity scores.

The behaviour of ceos used to be directly visible only to a limited number of people. Now bosses are everywhere, tweeting, posting and making stilted videos. In a recent survey by Brunswick Group, a pr firm, 82% of respondents said they would research the boss’s social-media accounts if they were considering joining a new firm. Even earnings calls offer insights. Academics at Columbia Business School and Harvard Business School have found that managers who invite colleagues to respond to analysts’ questions on these calls are more likely to work in firms that have more cohesive leadership teams.

Employee-review sites like Glassdoor are another source of insight. These sites can be distorted by embittered ex-workers. But, says Kevin Oakes of the Institute for Corporate Productivity, a research outfit, they are also likely to contain “slivers of truth”. And all these slivers add up. There is no substitute for being at a firm day in, day out, if you want to understand what it is really like. But the outlines of corporate culture are more discernible than ever. That ought to lead to fewer cases of indigestion.

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Read more from Bartleby, our columnist on management and work:
Beach reads for business folk (Jul 2nd)
Why managers deserve more understanding (Jun 25th)
Work, the wasted years (Jun 16th)

This article appeared in the Business section of the print edition under the headline “How to read corporate culture”

From the July 9th 2022 edition

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