Richard Branson on Creating a Healthy Company Culture
Editor's Note: Entrepreneur Richard Branson regularly shares his business experience and advice with readers. Ask him a question and your query might be the inspiration for a future column.
Q. I am interested in starting a business with two of my close friends, and we already have a lot of ideas. When a company is run by a group of friends, what sort of atmosphere should it have? Should it be corporate or more informal? -- Guru Vignesh V., India
Starting a business is a stressful, demanding process. Working with family and friends can certainly be a great idea, since those bonds can help to relieve some of the strain.
Guru, it sounds like you and your friends are onto a good thing. You seem to have a healthy respect for each other, plenty of ideas and the courage to try them. So I think it’s wonderful and wise that you’re already thinking about your business’ culture -- carefully mapping this out is an important step in starting up a company.
It wasn’t one that our team thought about during Virgin’s early days -- we were simply lucky in this area. Anyone who has followed the Virgin story knows that our company culture has driven our success. As I’ve written in the past, our team inadvertently created Virgin while we were lolling around on beanbags at our first record shop in London. After the launch, the business’s finances were pretty tight -- at the end of each week, we’d have to figure out if we had earned enough money to pay the rent and the staff - but this didn’t bother us. We were having such a great time that we kept going, mostly because we just liked hanging out together. One of the last things on our minds was setting up a company, let alone a corporate culture.
Since we were happy, we treated our Virgin Records customers like they were part of the family. And since our customers loved their experience, they kept coming back for more. Before we knew it, we had opened more shops and we were selling more records. It was hard work, and we spent plenty of sleepless nights worrying about all kinds of business problems, but we kept at it because, again, we were enjoying what we were doing.
As Virgin grew, our “serious fun” approach became a driving force for our enterprise. We took our passion for our work and our idea that we could upend “business as usual” to change things for the better and applied them to creating better banks, trains, telecoms and airliners, plus a multitude of other diverse ventures around the world.
We are often asked how we have maintained this culture across the more than 300 companies that Virgin has started up. The answer: We make sure that every new company that joins the Virgin family fits within the brand’s ethos and personality, which includes a commitment to making a positive difference for the wider community and the planet. A cornerstone of our efforts to make a difference is our nonprofit, Virgin Unite, which supports enterprises with likeminded goals. As your company grows, you might consider this solution as well.
Of course, not all great corporate cultures come about by chance, as ours did. Most are the result of sustained and exemplary leadership. A great example is Herb Kelleher’s Southwest Airlines.
When Herb started working on his idea for the company in the 1960s, he realized that if his carrier was going to survive in the competitive airline industry, it would have to offer something more than lower fares. Over time, Southwest developed a reputation as a happy-go-lucky, fun company and an industry leader -- the airline’s friendly cabin crews have often been admired by competitors, and Southwest has been recognized as one of the best places to work in the United States, year after year. Herb had understood that if you hire people who are committed to delivering consistently excellent customer service, success is more likely to follow as powerful bonds are formed between employees and customers.
With these examples in mind, my advice for a startup like yours is to foster an inclusive, familylike atmosphere and a sense of playfulness, because your staff’s happiness will be critical to sustaining your company’s success.
It’s terrific that you and your friends already have the vision to recognize this. The famous management consultant and author Peter Drucker once pointed out that “culture eats strategy for breakfast.” Culture is one of the most underappreciated essentials in business: No matter how visionary, brilliant and far-reaching a leader’s strategy might be, it can all come undone if it is not fully supported by a strong and spirited corporate culture.
Good luck with your new business, Guru! Remember that a fun and inclusive atmosphere will make this journey you’re embarking on more enjoyable -- and much more likely to be successful.