Corporate Culture In Tough Economic Times

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This month, Engineered Notes has invited a guest Blogger to join the conversation. Michael Blondin is the Chief Operating Officer at Engineering at Engineered Software, Inc. and has nearly 15 years experience in business joining Engineered Software in 2005. Feel free to comment on this post or send your thoughts and suggestions to the blogger email, we will make sure he receives any and all of your feedback.

Corporate Culture In Tough Economic Times

If you’ve ever been involved in a failing business, you have a solid understanding of what it is like to work in an environment where your only goal is keeping yourself employed, while trying to find the quickest way to a more stable opportunity. Deadlines slip, focus is lost, and each person is looking out only for their own self-interest. I’ve been there - working for a small (50 person), growing, privately held technology company in 2001, who was days away from our IPO before the bubble burst, and the staff was cut in half over a sixth-month period. And this wasn’t some half-brained start-up, this was a solid company with 20 years of history of treating employees and customers the right way. What changed in that six-month period that brought the organization to its knees? The company’s corporate culture.

Fast forward almost 10 years and I find myself again working at a small (35 employee), growing, privately held technology company in the middle of a global economic meltdown. Only this time there is no panic, no loss of focus. Instead there is a deeper concentration, renewed focus, and a dedicated desire to grow out of the recession, not be swallowed up by it. How are we making this happen? By keeping a focus on maintaining our company culture – who we are, how we got here and how we will continue to succeed in the future.

Company culture is defined as the, ‘values and practices shared by a company’s employees’. A company’s culture can change over time, being influenced by a variety of factors. Some of this can be subtle, such as individual employees entering and leaving the company. Others can be overt, such moving office buildings to a new location where everything is new – it just makes people feel better about showing up to work. Company culture is most tested during times of high stress – the release of highly anticipated products, sharp changes in revenue (both positive and negative) and changes in leadership are a few examples.

What, as leader of an organization, can you do to continue to promote a positive company culture during times of high stress (such as the current economic situation)? Here are a few keys:

Communication: Positive, negative or indifferent, employees want to know the state of the business. For a publicly held company there is all kinds of information available through SEC reports and other required financial documents. In a privately held organization, this information is much more difficult to come by for employees. Therefore, honest and straightforward communication is key. If you need to cut costs to lower expenses, fine, but tell employees why. You may find that employees come up with ways to cost cut on their own to pitch-in on reducing expenses. If a new product is failing to meet expectations, let them know. Of course, don’t forget to communicate those positive product roll-outs that meet or exceed expectations as well.

Focus: The biggest issue for the company that I worked for in 2001 is that we completely lost the focus of why the business had been successful for 20 years. Management kept coming up with new ideas for ways to drive revenue – so many ideas  that sales people didn’t know what they should be selling, marketing didn’t know where to spend dollars and product development wasn’t sure of which products to be concentrating on. Here at ESI we have kept focus on the task at hand – continuing to develop and grow our core products - while expanding our product offerings in a measured and controlled manner. The key is that we have never taken our eyes off of the development of our core products. They are what brought us here, and they will be what continues to sustain us in the future.

Customer Support: At the end of the day, it is the customer who puts money into the bank account that pays our bills. If the quality of customer support and interactions decline, years of goodwill and trust can be gone in an instant. Companies looking to save a few dollars by outsourcing development and support have found this out the hard way, with unsatisfied customers. The problem with an unsatisfied customer is that they will look elsewhere for products in the future. At ESI we have remained dedicated to the end user – which continues to lead to happy customers. And happy customers leads to the continuation of a positive corporate culture as employees feel good about their products and the company they work for.

Employee involvement and empowerment: Nothing is more rewarding than watching an invested employee (or group of employees) who feel empowered to get things accomplished showing off the work they have completed. We have a general strategy at ESI to hire good people, give them the proper training and support, then stay out of there way as they get the job done.  By keeping employees happy in this manner we have maintained an extremely low turnover rate – which leads to a stable company culture where employees know they will be treated fairly, both when things are going well and when the sales are more challenging to come by.

As the economic slowdown continues through its third year across the globe, I know that ESI is going to emerge as a stronger organization as we work to grow through this recession. How is that? We have kept our company culture in tact – by openly communicating with employees, maintaining focus on what we do well and our goals to expand, providing top notch support of customers and keeping our employees involved and empowered.

As we grow, I look forward to the coming challenges of maintaining our company culture as we expand our employee numbers, customer base, products sold and markets served.

Now it’s time to hear from you. Have you survived a company who's corporate culture was destructive to the longevity of the company? Better yet, have you worked for (or still work for) an organization that has such a positive, energetic corporate culture that it's worthy of an award? Let us know! Please feel free to share your experiences, or opinions on this blog entry or any other subject that is of interest. Email blogger@eng-software.com