Why are some companies extraordinary and others are not?

What is the difference between great, average and bad?

I have a hypothesis. That the difference between great companies and average companies is the size of the gap that exists between what they say and what they do.

Great Companies

Here is what Apple CEO, Tim Cook said about the company shortly after Steve Job’s passing:

“We believe that we are on the face of the earth to make great products and that’s not changing.

We are constantly focusing on innovating.

We believe in the simple not the complex.

We believe that we need to own and control the primary technologies behind the products that we make, and participate only in markets where we can make a significant contribution.

We believe in saying no to thousands of projects, so that we can really focus on the few that are truly important and meaningful to us.

We believe in deep collaboration and cross-pollination of our groups, which allow us to innovate in a way that others cannot.

And frankly, we don’t settle for anything less than excellence in every group in the company, and we have the self-honesty to admit when we’re wrong and the courage to change.

And I think regardless of who is in what job those values are so embedded in this company that Apple will do extremely well.”

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If you’re an Apple customer, you can’t argue with the fact that this isn’t lip service. Apple does indeed create great products, they do consistently focus on innovation, they do make the complex simple, they do participate in markets where they can make a significant contribution, they do control the tech behind the products, they do say no so that they can focus, they do collaborate internally, they don’t settle for less than excellent. Even if you’re a detractor, you can’t argue with popularity. You could, but you’d be wrong. What’s interesting is that last sentence.

“Regardless of who is in what job those values are so embedded in this company that Apple will do extremely well.”

What Apple and other great companies get that average and horrendous companies don’t understand is that when you bend your beliefs by outwardly claiming one thing and then doing another is that this erodes culture. It undermines culture because when the leadership of a company bends their values, they don’t get embedded in their people and they too begin to buckle. This then creates an extremely flimsy foundation on which to build a world-changing company. People are, for now at least, are the company.

Average Companies

Most retailers are good examples of average, disposable companies. This week in the UK, ToysRUs and Maplin Electronics went into administration, and nobody aside from their employees will miss them. I‘ll buy toys from Amazon, and I guess I’ll get my electronics from there too.

Maplin’s USP was their staff and knowledge. They should have engaged in a programme which spoke to front-line employees about customer needs and identifies strengths so that they could adapt their business model.

I suspect that they would have discovered an opportunity to maximize the skills and expertise of their staff to run workshops and training programmes directly in store.

Apple has recently revamped their in-store workshop offering to focus more on lifestyle workshops such as “Music Lab: Developing Your Sound” which demonstrates how to produce music on iPad Pro. It is proving to be a big hit with customers looking to get more from their products.

Maplin could have used this model and skills to enable the “Maker” end of the customer spectrum with the skills and expertise to build their own Arduino projects or even design their own smart home. This would have provided a point of differentiation against buying online, maximized the skills of their frontline staff, made the stores a destination and encouraged customer loyalty.

It’s a shame that a brand who have often “bailed me out” when I have forgotten a charger or AV connector wasn’t bailed out themselves, but its a lesson to innovate or die.

But why would they? They don’t exist for a higher purpose other than to flog electronics from the buildings they occupy. Culturally, it likely wouldn’t have occurred them to do this because there’s nothing else they genuinely exist to do.

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Average companies are ones who have never professed to have a discernable set of values or belief system to live up to. They exist to sell other people’s products, don’t create anything and probably never will. This is fine — not every company can be a great company. Nor does every company need to be. I wouldn’t want to work there, and I’m sure they wouldn’t want me to.

Bad Companies

Average companies didn’t set out to change anything, so at least there’s nothing to erode. I’m kind of okay with average companies, they’ll come and go, but truly the worst organisations on the planet are those that claim one thing and do another.

There is nothing that chips away at morale, trust and passion faster than a company who profess something externally that it’s people internally simply don’t recognize.

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Glassdoor is an excellent place to find out the disconnect that exists between the external projection and internal reality of a company. They ranked the top 10 worst companies in the UK to work for on that list:

Companies are groups of people. The most exceptional companies know that saying something and living up to it breeds culture and retains good people who will make the right decisions for the organization.

The difference between average businesses and those that change the world is how vast the chasm between what the company says and what the company does.

We should all do a little more to close the gap.

CultureJacob Dutton