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Financial Planning > UHNW Client Services > Family Office News

Culture Management

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Every company has a unique culture. Compare GE to Nordstrom, Southwest Airlines to Fidelity, or The Ritz to Microsoft. Each is an example of an organization that has used its distinctive culture to drive an agenda. Why should you care about culture? Let’s begin by reviewing what organizational culture is.

Culture is a system of learned behaviors that originate when individuals react and adapt to their surroundings. The reactions and adaptations of the people in an organization–collectively and over time–form the organization’s culture. Culture includes the ideas, attitudes, assumptions, beliefs, values, norms, traditions, and behaviors that individuals in an organization share.

Who should care about culture? You should. Culture has a significant impact on the way individuals approach work every day. Historically, small business owners like investment advisors and financial planners may have ignored a concept like “corporate culture,” thinking it applied only to Fortune 500 companies. But attention to culture isn’t just for big companies. The more accurate question you should ask yourself is not whether your organization has culture, but rather whether you know what the culture of your organization is and how to use it to drive your company’s agenda. There is no doubt that the culture of the workplace affects productivity, customer loyalty, efficiency, and ultimately profitability. So if you haven’t paid attention to your culture in the past, it’s time to start.

By contrast, smart financial professionals are attuned to noticing the culture and values of their clients. In her June 2006 column for Investment Advisor, “Listening to Margaret Mead,” Susan Hirshman referenced five archetypes of millionaire clients: thrillionaire (who grab life by the horns), coolionaires (who are fond of expressing themselves), realionaires (“Be yourself”), wellionaires (who strive to achieve a life in balance), and willionaires (primarily interested in wealth preservation). Hirshman notes that while everyone is unique and generalizations are dangerous, these types of affluent people do share many characteristics and these archetypes can help us to understand the “why” behind a client’s decision making.

Just as paying attention to a client’s values supports the financial planning process, paying attention to culture helps develop a productive and satisfying workplace.

Do Your Own Dig

Assessing the culture of your organization requires you to go on an “archeological dig” to collect the artifacts that tell you about your culture. If you don’t happen to be an archeologist, a simplified approach is to recall the childhood admonition to Stop, Look, and Listen. Like a small child at the train tracks, stop to look at and listen to what goes on. You can learn a tremendous amount simply by awakening your senses. Next, upgrade your observational skills. Have you ever gone on a nature walk with a professional guide? While most of us see a tree, the professional observer notices the color, texture, and smell of the bark; how frequently branches separate; if leaves are parallel or alternate; and much more. With sharpened observational skills, here are some things to note as you begin your archeological dig.

The Physical Plant

Is your office rented space in an office building or an executive suite complete with support service? Is it a condo or a house? How clean is it? Are furniture and accessories up to date or worn? How welcoming or professional does the office feel when you enter?

Look at the walls in the public areas and in offices and cubicles. Are bulletin boards filled with charts, facts, and figures? Pictures of the family? Reminders to recycle or to turn off the lights? Mementos from an event? Signed lithographs?

The Dress “Code”

Is the organization buttoned up or casual? How professional, fashionable, comfortable, or revealing do people dress? Is the dress code articulated? Does it change on certain days? Do employees comply?

Background Sound

What do you hear when you listen to the organization? Are people talking to one another, collaborating on projects, meeting in conference rooms? Do you hear laughter? Is the day filled with conversations with clients? Is the tone of voice used on the phone with clients the same as that used for internal interactions? Or is there white noise or keyboard clicks coming from employees as they interact silently with technology? Is music allowed? If so, what kind is played?

Social Interaction

What is the level of social interaction among employees outside of work? Is it constant? Reserved for significant activities? Or do employees socialize only at company events? What do people do at lunchtime? Do they bag lunch or go out; eat separately or together? Or is there a tendency to work through lunch? How much horseplay or practical joking is tolerated or invited?

Work Ethic

When does work get done? Are there more productive and less productive times? Is work after hours tolerated, encouraged, or expected? Is the work ethic consistent among employees or is there a wide range of what is acceptable?

Teamwork Vs. Independence

Do employees collaborate or compete? Is there so much teamwork that no single person is accountable?

Standards of Performance

How high is the bar set for work performed? Is it always high, or does it depend upon what the project is and/or who it is for?

Pet Projects

Which tasks or projects get drawn out and in which does everyone love to participate?

Rules of Conduct

Are there stated rules of the firm–such as how the phone is answered or number of rings allowed before it is picked up? Is sending personal e-mail via the company computer or surfing the Web for non-work-related information allowed? Are rules in writing? Are the rules followed, and if they aren’t, what happens?


Does the organization celebrate individual events and company success, or are there no celebrations at all? How, when, and where do celebrations occur?

Client Orientation

What attitude do customers display to you and to your staff? Are they submissive, respectful, arrogant, rude? What can customers get away with and does it depend on the quantity of investments with the firm?

Culture and the Owner’s Values

There is another major factor that influences company culture. In small organizations, it is common for culture to unconsciously spring from the values of the owner. One key step in assessing your organization’s culture is to take a look at yourself. This list will help you get started with this self assessment:

- Do you delegate? What kind of work is delegated–the serious projects or administrative details?

- When do you arrive for work and when do you leave? Are you consistently at work before or after employees, or is the opposite the case?

- How quickly or slowly do you make decisions? How much data or input do you collect before making a decision? Is employee input sought frequently, occasionally, or never?

- Do you have formal staff meetings at predefined times and with a written agenda, or do you get together casually whenever you decide and wing it?

- Do you bury or encourage conflict? Are conflicts resolved and used to improve, or does conflict linger indefinitely?

- Do you actively look for ways to develop your staff? Do you pay for development and give employees time off for development, or do you discourage such efforts?

- Do you tolerate mediocre or poor performance? Do you wait for poor performers to quit or do you help them exit?

- What do you measure? The top line, the bottom line, AUM, employee turnover, number of new clients, margins, customer satisfaction, customer loyalty?

- What is your dominant time horizon? Do you focus on this day, month, year, or decade? How does this impact the way you position your organization with customers and employees?

- What kind of work do you do first and on what do you procrastinate?

- Which clients are you most and least anxious to meet with? Why? What comments do you make about clients to your staff?

- What do you spend money on? Technology, marketing, staff, consultants, d?(C)cor?

Your personal and organization-wide archeological dig will provide innumerable details.

Taken together, these details paint a fairly accurate picture of your organization’s culture.

To group details into themes, write each detail on a sticky note and post it on a wall. Then, move the stickies around to create clusters of similar messages about company culture. The point of the exercise is to understand what culture you’ve got now versus the culture you want. Along the way, you will also discover how well your own behavior matches the behavior you would display in the kind of organization you say you want.

Examples of Culture

You may discover your organization has a strong culture of efficiency. You measure the turnaround on paperwork; you document processes to aid efficiency and employees follow them; you terminate employees for being too slow. At the end of each business day, every desk is left neat–with no outstanding papers, forms, or printouts in view. But you might find the culture of efficiency is so strong that it overshadows everything else, including accuracy.

Or you may find that everyone in your office, including you, focuses on being nice to one another and to clients. You may hear banter back and forth throughout the day, as employees chat with one another and with customers. Turnover may be extremely low and client retention may be high. The office may be perceived by everyone as friendly. But it may also have very high overhead and low profitability.

Another example is that the office prides itself on customer service. Everyone bends over backward for clients. Customer service is the driver that influences how fast and accurately work is done. But employees feel like slaves and turnover is high.

You may find your culture is too laid back and informal–bordering on unprofessional. Rules and structure may be absent and the company may be overly comfortable. The organization has historically recognized individual contributions, but, for the organization to thrive, fostering teamwork instead of individual accomplishments may be the essential next step.

Don’t be surprised to find good and bad things about your culture. More than likely you will find that while a particular cultural value is what you want, it may need to be enhanced or reduced.

There is no one good or bad, right or wrong, culture. But with greater awareness of what your culture is, you can assess if you need to refine what you’ve already got.

Changing Culture

If you determine that your current corporate culture is not what you want, for whatever reason, here are some action steps to help you change it:

Articulate the culture you do want. Make the effort to find exactly the right words to define and describe what the desired culture is and why it is important.

Share the words with everyone. Discuss the goal with employees. Come up with examples to help employees develop their own mental picture of what is most important. This is not a one-shot event. To change culture, the desired state must be articulated, rearticulated, and emphasized repeatedly.

Decide on three to five important and specific changes to make. These must be implemented over time. Introduce these changes to everyone in your organization. Explain them and why they are critical to everyone.

Lead the way with your own behavior and attitudes, and be sure you model the changes you want made in the organization.

Pay attention to the impact each change is having on the culture to be sure the desired effect is taking shape. Better yet, measure what is changing.

Acknowledge positive change. When you see examples of the desired culture, share it with others and recognize those involved. Problem-solve around barriers to the change.

Be patient. Encourage the entire organization to be patient. It’s not a simple thing to change an organization’s culture–and it certainly doesn’t happen overnight.

In time, hire employees that embrace the culture you want and compensate those who perform in compliance with the values. On the other hand, consider that employees who can’t get with the plan may not have a future role in your organization.

Culture as Leverage

The financial professional is constantly busy–taking client calls, following the market, keeping informed about new products and compliance requirements, and facing the increasing challenges involved in running a profitable business. Do you also now have to worry about something as esoteric as culture?

Absolutely not. If “worrying” about culture is your perception, you may be better off forgetting about it. But personnel make up the largest component of overhead in this industry. So you may want to implement a right-sized cultural assessment project for a small business environment by taking a few half days throughout the year to stop, look, and listen.

By attending to culture, you can leverage your time and talent. The culture you create can positively affect each moment of each day for every employee and client. You might just decide that a focus on culture is not one more thing to worry about, but rather an untapped opportunity to take advantage of.

Joni Youngwirth is vp of practice management at Commonwealth Financial Network in Waltham, Massachusetts, and can be reached at [email protected].


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