ADVANCED TIP
Building a Corporate Culture

Gary Abram, co-founder and managing partner of Kansas City-based H-Cap International, a management consulting company in Kansas City, Mo., discusses corporate culture and its value in retaining employees.

Q: Define corporate culture?

Abram: Every company’s got one. It’s an aggregation of the values and vision and the direction that a company has. Its vibes or pulse emanate from the seat of power, so in real estate, it’s the broker or manager who is typically the tone-setter. Corporate culture also has something to do with the relationships within a company and how we communicate with one another. Within cultures, there are subcultures—departmental cultures, for instance.

Q: What’s the importance of an organization’s culture to its retention efforts?

Abram: There’s a direct correlation between employee satisfaction and retention. No one wants to stay in toxic corporate culture unless they are the ones making it toxic. One of the keys to building a good culture is picking the right workers. If you don’t chose the right people, the culture will never get there. You can’t build a positive culture with people who are chronically dissatisfied and toxic.

Q: Is it possible for a real estate company to have a so-so culture and still service clients well?

Abram: It’s hard to be bi-polar—internally be one thing and externally be another thing. It gets to be transparent. If you have an organization that’s really dysfunctional internally—where culture is that of command and control and there’s not a high level of satisfaction—there’s some bleed-out to the public that’s reflected in how staff and salespeople handle customers. If it’s screwed up on the inside, the customer pays the price.

Q: How do you know if your culture is in trouble?

Abram: The big measuring stick is employee turnover. If people aren’t staying and are voting with their feet, there’s probably a problem in the culture. Looking at oneself is pretty hard; most everyone is good at self-deception and that extends to companies. Sometimes you hire an outsider who challenges your assumptions, asks hard questions of employees and customers, and gives a dose of reality. It’s only through a wake-up call that something changes.

Q: How do you change a culture?

Abram: First, find out what the culture is really like. That’s not easy to do because most leaders are delusional. They see the culture the way they want it to be, not necessarily the way it is. Our company uses the OCI (Organizational, Cultural Inventory) by Human Synergistics International to look at things in terms of: Do you have a humanistic, dependent, or political culture? What’s the prevailing spirit? How do people come together and relate to one another? Awareness is curative—the starting point. If you want to change a culture, you need to know the starting point.

Q: Then what?

Abram: You could have a long tedious way to go if the culture is sick. You may have the wrong people in the wrong leadership roles. First, decide where you want your company to go. For example, I have a client with an 80-year legacy of hands-on, micromanagement at the top level. As a result, the company lacks creative middle managers and is underperforming. The CEO wanted to encourage the company’s middle managers to take more initiative, but when you’ve had all those years of a dependent culture, it’s hard to get to change the old habits and push decision-making down. This sort of corporate change involves both the culture—being more open to ideas from all levels of the company—and the structure—giving middle managers more power.

ADVANCED TIP: Consider establishing a profit-sharing plan to help retain top associates. Distribution can be based on several formulas, including length of service or the percentage of the profits salespeople bring in. What’s nice is that the plan helps salespeople gain an appreciation of the cost of running a real estate company and have a vested interest in reducing overhead and helping new salespeople succeed and become profitable.

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