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A CEO's Main Focus Should Be Improving Company Culture Your product or service should never come first.

By Nadya Khoja Edited by Dan Bova

Opinions expressed by Entrepreneur contributors are their own.

Yuri_Arcurs | Getty Images

This article is included in Entrepreneur Voices on Company Culture, a new book containing insights from more than 20 contributors, entrepreneurs, and thought leaders.

Having a great company culture doesn't mean having ping-pong tables and free beer. Those are perks. And although many emerging startups boast benefits such as weekly outings, free lunches and "Scotch Fridays," these will not lead to the success and growth of your company.

Sure, these are nice benefits to have, but in the long run, they will just lead to a more complacent staff -- a group confused about what the actual values and goals of the business are.

Related: 5 Ingredients for a Successful Work Environment

What many CEOs and VPs struggle to accomplish is identifying what exactly "culture" means and why it's important. There are a few things you can do to start focusing on improving your culture and using it as a tool to boost productivity, find top talent and accelerate growth.

Identify your company's real values.

Core values are essentially a deeper look into the behaviors of a company, specifically the behaviors that lead to success. Jocelyn Goldfein of Zetta Venture Partners says your "culture is the behavior you reward and punish."

If you think about it, how often do new employees make their way into a company, already understanding the culture? Not often. It takes time for new hires to get their bearings and fit in. What do they do instead? They look around and try to mimic what other people are doing -- specifically what the top performers are doing.

Here is an exercise you can do during your next team meeting. Ask everyone what it takes to be successful at your company. Write down the responses. These are the behaviors that your business rewards, and in turn, the values you promote. Next, make a list of these values and ask your team to describe, using examples, what it means to demonstrate those values.

For example, Venngage has five main core values as demonstrated below:

Although the above fact sheet helps to describe what it is we look for in employees, it fails to address how to demonstrate each core value.

It's extremely important that your staff understands the how, which is why you must go through each value and ask your team how they would demonstrate it. For instance, when I asked the marketing team how to "own their jobs" as marketers, they came up with the following list. Owning your job means:

  • Staying on top of trends in the industry and hot topics
  • Knowing what strengths you bring to the team and capitalizing on that
  • Being open to learning new things
  • Taking accountability for your own actions
  • Being proactive/taking initiative
  • Presenting the company to others positively (brand evangelism)
  • Striving to become a thought leader
  • Staying on top of deadlines
  • Constantly working towards becoming a well-rounded marketer

The next question is figuring out how to get your employees to continuously embody those behaviors.

Related: How Restaurant CEO Cameron Mitchell Finds and Keeps Talent

Enforcing core values and culture.

In Gino Wickman's book, Traction: Get a Grip on Your Business, he talks about an evaluation process called The People Analyzer. This process is first and foremost designed to clarify whether or not you have the right person in the right seat. But the secondary purpose is to identify if the members on your team do in fact demonstrate the company's core values.

Here is what it looks like:

The scale is easy to follow; a minus sign means the person does not reflect that behavior, a positive sign means they do, and a positive and minus sign means that they kind of embody the value, but they aren't where they should be.

The strike system.

Every 30 days, use the people analyzer to "grade" each of your employees. If they are underperforming in a certain area, be sure that during your one-on-one, you bring up the issue. Let them know that you will check in again in 30 days. This is their first strike.

After another 30 days, if they are still underperforming, go over the issues once more during your one-on-one. What specifically are they doing wrong? Where are they falling short? Be specific. Then give them another 30 days to get up to speed. This is strike two.

If after another 30 days, the minus sign is still holding strong, it is unlikely that the employee will improve. This is the point when you should let them go. This is strike three.

Rewarding adherence to values.

Like I mentioned before, new employees -- or existing ones for that matter -- will mimic good behavior. If they see that one particular employee gets along well with the boss, that their opinions are always heard and that they are awarded exciting opportunities, others will try to follow their patterns.

But part of clarifying your culture, and helping others embody it, is by rewarding behaviors that reflect the culture. What we do is give "shoutouts" to A-players every week during our team meetings. For instance, if Alice took initiative to attend a meetup on growth marketing during the weekend, that is a prime example of demonstrating the core value of "continuous improvement."

Now John can see that she has been publicly praised, and he will try to replicate that exact behavior. This is just one way to draw attention to positive displays of company culture.

Envisioning the greater goal.

As a CEO, it goes without saying that you have an agenda -- a greater goal that you want to achieve. What is that goal? I'll tell you now that your goal should probably not be revenue driven. Revenue should be a side effect of hitting the goal.

Some might assume that a CEO's goal is the mission statement of the company, but this is not entirely accurate. The mission statement is the company goal, but your goal as a CEO needs to be more personal. There's a more pointed question that might lead you towards better understanding what that goal is -- how do you want to be remembered? What do you want the words on your tombstone to read?

Related: 10 Examples of Companies With Fantastic Cultures

It's important for you to figure out the answer to this, because it is what will guide the values that make up the culture of your company, and in turn, lead to your success.

Culture can make or break a company. Do not be the person who puts your product above your culture. Instead, focus on providing meaning to the work your employees do.

Nadya Khoja

Director of Marketing for Venngage infographics

Nadya is the Director of Marketing for Venngage infographics. When she is not writing about SEO, Content Marketing, Productivity and Business, she cooks dinner for strangers in apartment restaurant, Chez Lisgar.

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