Entrepreneurial advice: Why start-ups should prioritise culture over their bottom line

26 May 2021 - 13:10 By Ian Fuhr
For 10 years, Ian Fuhr personally inducted every new Sorbet employee, saying that understanding your customers and how you make them feel is the most important concept to get across.
For 10 years, Ian Fuhr personally inducted every new Sorbet employee, saying that understanding your customers and how you make them feel is the most important concept to get across.
Image: Supplied

Experienced SA entrepreneur Ian Fuhr, who now trains executives on the importance of organisational culture, shares his advice.

When I launched Sorbet in 2004, I had a culture framework I had spent decades designing and testing, learning as I went along. The result was that I had a very clear idea around the type of culture I wanted to champion, and I started implementing it from the moment we launched.

I believe our culture was responsible for our growth, and why Sorbet became the largest and most successful beauty salon chain in Africa 10 years later. It was our key differentiator.

Over the years, I’ve become known as a culture champion. In many respects, I believe culture is the single most defining factor in the success of a business. Which is why I’m consistently approached and asked a single question: How do I fix my culture?

Laying the right foundations for success

Here’s the problem. Start-ups are generally about inception and survival. Entrepreneurs spot a gap in the market or a problem they want to solve, and they build as they go.

Start-ups are characterised by entrepreneurs wearing many hats — accountant, sales, marketing, product development, receptionist and cleaning staff.

As the business gains traction and some cash starts flowing in (and the business owner can no longer do everything themselves), employees are brought on board. The business grows organically, and the culture takes on a life of its own.

That’s often where things start to go wrong because at some point, the business becomes big enough that clients begin to not only expect excellent customer service, but a predictable and consistent experience, which is only possible if every employee understands the purpose of the business and shares the same vision and values. In other words, there needs to be a strong, unified culture that binds everyone in the organisation together.

Unfortunately, by the time many business owners realise this, there already is a culture in place — it’s just not the culture they envisaged (if they took the time to think about what they wanted their company culture to be in the first place, that is). Instead, it has grown organically, warts and all.

It’s been influenced by great employees, but also by the bad apples.

Your Reason for Being should only ever be about your customers and how you make them feel.

Not only do the foundations of a strong culture need to be put in place, but the existing culture must be dismantled, and old bad habits must be unlearned, which complicates matters enormously.

Never too early to focus on culture

You don’t need to have 500 employees before you start worrying about your culture. You don’t even need 30 employees. You can be a one person business looking forward to finally hiring another sales rep to support you.

The first ingredient to any successful business culture is understanding your Reason for Being, and this is something you should be focusing on from the moment you launch.

Your Reason for Being asks one fundamental question: “Why does my company exist?”

Too many business leaders think the answer to this question is to make money, or a profit, or even a return on investment. The focus is on making sales and growing the bottom line.

But if that’s all you’re focusing on, where do your clients fit in? And since it’s unlikely your employees will really care about growing your bottom line for you, where does it leave them?

Let’s be crystal clear. Your Reason for Being can never be about you or the company, or the shareholders, or the stakeholders, and it’s definitely not about the money.

Your Reason for Being should only ever be about your customers and how you make them feel.

Making money will be your reward, but it can’t be the reason you exist.

I’m not saying profits are not important. They are critical to the sustainability and growth of any business, particularly start-ups. All that I’m suggesting is that we understand the sequence of our priorities, service before reward, and that when we do, the foundations of a strong culture will already be in place as the business grows.

Understanding your Reason for Being at Sorbet, for example, we first had to understand why people came to beauty salons. The answer to this was not as simple as it seemed.

On the surface, logic told us that our guests, (as we called them) came to have beauty treatments and buy skincare products, but we needed to look beyond that and see a much bigger picture. The real reason people go to beauty salons is to feel better about themselves. They want to leave feeling better than they did when they arrived.

In essence, we were not selling treatments and products. We were selling a feeling. At Sorbet, our Reason for Being was, therefore, “touching people’s lives”.

This was the foundation of our culture — a deep desire to touch people’s lives and to serve them. It was our purpose.

For 10 years I personally inducted every new employee, and this was the most important concept I needed to get across. This was how we created a unique business culture.

Making money will be your reward, but it can’t be the reason you exist.

This culture enabled us to achieve the most challenging of all our objectives: to create a relatively consistent level of personalised service across a chain of 225 stores.

From the outset, I was told this was an unachievable objective and was the reason a multi-unit beauty salon brand had never been established in SA.

I’m here to tell you that nothing is impossible if you can build a community of people who dedicate themselves to a powerful Reason for Being. We proved this.

Getting the basics right

Clearly, culture is not a perfect science. Anything that requires human endeavour is vulnerable to the frailties and inconsistencies of individuality.

Humans are the most inconsistent creatures on earth, so to get 100% buy-in to any philosophy is not a realistic objective. There will always be those who do not believe what we believe, who do not see the power of placing service before self-interest and who will always take more than they give. As a result, there are bound to be some service failures along the way and some disappointed clients.

But, let me leave you with this thought: At Sorbet, our guest complaints amounted to less than 0.01% of our total treatments. Bearing in mind that, at the time I left, Sorbet was performing more than 400,000 beauty treatments per month, our complaint factor was insignificant.

Don’t wait for your business to grow before building a strong culture. Put the right foundations in place as early as you can and use your culture to leverage growth.

 

  • Fuhr is the founder of Sorbet and The Hatch Institute, a personal and business leadership coaching company

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