Creating Legendary Cultures

Twinkie Roasts, Door Desks and Sweeping the Shed

Celebrating a group of REI Anderson Award winners with a day of ocean kayaking and exploring Hope Island in Washington.

Hundreds of employees gather at the headquarters of a large Pacific Northwest retailer yelling, cheering and ringing cowbells.

Buses roll up to the sidewalk and employees walk out. They’ve traveled from all over the country, primarily from stores. They’re laughing. Some cry tears of joy.

This scene, an annual event at Seattle-based retailer REI, exemplifies what customer obsessed companies do. They create unique rituals and mechanisms to enable powerful and idiosyncratic cultures, in service of customers. They understand that culture is the most differentiating and powerful force in organizations when deeply aligned with their mission and purpose.

This is REI’s annual Anderson Awards, the highest honor an employee at the Seattle-based retailer can receive, named after Seattle climbers and founders Lloyd and Mary Anderson. For a week, headquarters employees stop normal activities to celebrate the Anderson Award winners by hiking, climbing, running, cycling and kayaking together. (And ringing cowbells!)

I was lucky enough to experience this celebration multiple times at REI. And I’ve been fortunate to work at other customer-obsessed companies and see what they do dramatically differently to build a customer-centric culture.

The rituals of these companies may seem odd. They roast twinkies outside in the cold of winter (REI). They work at wooden door desks to emphasize frugality (Amazon). They sweep the locker room after a match to reinforce humility (New Zealand’s All Blacks rugby team). When you interact with these organizations, you directly experience the unique culture they create.

(More on Amazon door desks here: How a door became a desk, and a symbol of Amazon - About Amazon Singapore)

Imagine this. A customer spills coffee on their pants on a flight from Seattle to DC. She is upset because she has an important meeting in DC.

When she arrives at Reagan Airport in DC, the site manager for the airline greets the customer as she walks off the plane. He has a team ready to help her get new pants. The flight attendant messaged ahead to DC, alerted the local team and they took action.

This real-life example was not scripted in a playbook. It is an example of customer-obsessed culture, an employee knowing their job is to do the right thing for the customer and that they will be supported in doing this. You cannot script every scenario a customer will face. At a customer obsessed company, employees know they can “call an audible” in service of the customer. The company will have their back.

In my time at Amazon (1999-2005), I saw many examples of this. In the early days of Amazon’s UK business, customer service agents would drive a package to a customer’s home when they got off work to avoid a missed promise.

In the US, I spent time working the night shift in an Amazon fulfillment center in December, along with hundreds of other headquarters employees, to ensure we delivered a great holiday experience. (Other HQ employees worked in customer service.) In my first winter, I was picking books for a customer shipment when I noticed that Jeff Bezos was a few feet away, busy picking a customer order himself!

Amazon eventually codified its unusual culture in a set of iconic and idiosyncratic leadership principles, which are core to how Amazon works two decades later. (Who We Are - Amazon's Leadership Principles | About Amazon) These may be the most well-known leadership principles in corporate America. For a great read on Amazon’s culture, the best reference is Working Backwards: Bryar Colin & Carr: 9781529033847: Amazon.com: Books.

We’ve all experienced these cultures as customers. Recently, my wife and I celebrated a milestone anniversary at the Fairmont Kea Lani in Maui. We told an employee about our anniversary. Over and over again that week, hotel employees surprised and delighted us by celebrating our anniversary in fun ways.

Many companies have a set of cultural values and leadership principles that include customer-centricity. But often these values aren’t operationalized via rituals, mechanisms and behaviors. The greatest companies do this in a way that sets them apart. It’s an obsession deeply ingrained via operating mechanisms in a way that can seem idiosyncratic and even weird to outsiders.

There are many examples: Disney, Southwest Airlines, Netflix, Stripe, Nordstrom, the Golden State Warriors, Ritz Carlton. Each has a unique culture that supports its customer value proposition.

These are some simple and effective ways I’ve seen companies create culture:

·       They operationalize customer-centricity by building it into job descriptions, interview questions, performance reviews and reward systems. If you interview at Amazon, for example, each interviewer will be assigned a leadership principle. As the applicant, you may write an essay on one of them.

·       They create unique and memorable rituals to celebrate employees who provide exceptional service to customers, like REI’s Anderson Awards or Alaska Airlines’ Legends award. They make these employees the heroes of the organization.

·       They defy conventional thinking and legacy practices around management, performance reviews and working. One example is Jeff Bezos banning power point at Amazon or celebration of failure. These companies do things that seem odd to outsiders.

·       They ensure all employees remain connected to the customer. They do not rely solely on proxies such as NPS, CSAT or surveys. Employees listen to customer service calls. Or they regularly meet or serve customers. Some companies hire their customers, such as USAA (veterans), REI (outdoors people).

·       They know that their customer-facing employees are their product and their brand. They create a culture where these employees are celebrated, empowered and enabled.

·       Their HR departments are not primarily custodians of compliance and generic transactions. HR is an enabler and creator of culture.

Leaders model the culture in these organizations.

In my time at Alaska Airlines, I saw how the CEO flew coach and served coffee to customers on flights, not for optics but because it’s what customer-centric leaders do. Regularly he would meet with frequent fliers to thank them and hear their candid feedback about how we could do better. You know you are at a customer-centric company when leaders are regularly in the field meeting with customers.

At REI, I had the privilege of working with the leader of their industry leading outdoor experiences business. He routinely spent time on the trail with guides, cleaning tents, scrubbing dishes and serving food to customers.

These cultures are not guaranteed and can be lost. They must be maintained via intentional focus. As an example, Jeff Bezos uses the phrase “Day 1” to describe the culture and mindset Amazon must maintain. Bezos wrote in Amazon’s 2016 shareholder letter:

“Staying in Day 1 requires you to experiment patiently, accept failures, plant seeds, protect saplings, and double down when you see customer delight. A customer-obsessed culture best creates the conditions where all of that can happen.” (Jeff Bezos' 2016 Letter to Amazon Shareholders)

According to Bezos, there is a significant risk to losing Day 1 culture: “Day 2 culture is stasis. Followed by irrelevance. Followed by excruciating, painful decline. Followed by death.”

It raises the question of whether, at 1.5M employees, Amazon can maintain this culture. And, more broadly, when a company loses its distinctive culture, can it regain it?

I believe in some cases it can. I worked at Microsoft at a time when it suffered a cultural malaise that was reflected in a lack of innovation in key areas, such as search, mobile devices and cloud.

CEO Satya Nadella reversed that and the company is thriving. He captures this cultural transformation in his book Hit Refresh (Amazon.com: Hit Refresh: The Quest to Rediscover Microsoft's Soul and Imagine a Better Future for Everyone eBook : Nadella, Satya, Shaw, Greg, Nichols, Jill Tracie, Gates, Bill: Kindle Store).

In short, customer-obsessed companies have unique and idiosyncratic cultures. They do things that might seem downright weird to outsiders. They create culture intentionally through mechanisms and rituals. First and foremost, leaders model them every day.

For those of you seeking to create a customer-obsessed culture in your organization, some questions to consider:

·       Is customer-centricity intentionally built into your culture via durable rituals and mechanisms?

·       Is your company culture uninspired or is it distinctive and even peculiar (in a good way)?

·       Do your leaders regularly and visibly model these values?

Book List:

·       The Disney Way (Amazon.com: The Disney Way:Harnessing the Management Secrets of Disney in Your Company, Third Edition eBook : Capodagli, Bill, Jackson, Lynn: Kindle Sto)re

·       No Rules, Rules about Netflix culture (Amazon.com: No Rules Rules: Netflix and the Culture of Reinvention eBook : Hastings, Reed, Meyer, Erin: Kindle Store)

·       The Nordstrom Way (Amazon.com: The Nordstrom Way to Customer Experience Excellence: Creating a Values-Driven Service Culture eBook : Spector, Robert, Reeves, breAnne O.: Kindle Store)

·       Nuts, about Southwest Airlines unique history and culture (Nuts!: Southwest Airlines' Crazy Recipe for Business and Personal Success: Freiberg, Kevin, Freiberg, Jackie: 9780767901840: Amazon.com: Books)

·       What You Do is Who You Are (Amazon.com: What You Do Is Who You Are: How to Create Your Business Culture eBook : Horowitz, Ben, Gates, Henry Louis: Kindle Store)