Behind the Headlines
Middle-market execs see corporate culture as key to growth
Week of March 25, 2019
Corporate culture is very important to middle-market executives, who on average spend about a quarter of their time on it.
That’s one of the key findings of “High Performance Culture,” a new report from National Center for the Middle Market. The report, based on online responses from 400 executive-level leaders from middle market businesses across a range of industries and geographies, also found that a defined, established culture is associated with much faster rates of revenue growth than an unclear one.
Nearly all those surveyed matched their company’s culture with one of seven different types: customer-centric, innovative and creative, risk-averse, great place to work, continuous improvement, technically oriented and highly efficient.
In terms of annual revenue, companies where culture focuses on innovation and creativity grew the fastest (by 9.4%), followed by those with technically oriented (9%), continuous improvement (8.8%) and great-place-to-work (8.7%) cultures. Companies with risk averse cultures grew the slowest, at 4.0%, and their leaders believe the culture is a turn-off for potential customers and employees.
“Culture may be defined many ways, but I like to say it’s the invisible person in the room guiding behavior when the boss isn’t there,” said Tom Stewart, the Center’s executive director.
“Culture is very important for scaling a business and middle-market executives are paying a lot of attention to it,” he said. “At the fastest growing companies, they spend even more time on culture.”
Mr. Stewart acknowledges that the study solely reflects executives’ views, not those of employees — whose views of a company’s culture often differs sharply from those running the business. “
Currently, the Center is running a beta test on an assessment tool that measures employee views of corporate culture,” Mr. Stewart said. “We encourage as many people as possible to take the survey so that we can assemble more data in this very important area.”