Patagonia Case Study - Harsha Narravula
Patagonia has a unique culture when compared to other corporate companies. They seem to simplify their values around 3 key cultural elements, caring about environment through corporate responsibility and furnishing profits by producing high quality and innovate products. These values were not just a marketing campaign but were well established/ visible throughout the company through visual artifacts, communication and pursuing business strategy in line with the values. It is these strong values that have set the company apart from competition and helped the company during economic down turns (values create identity, Lencioni, Pg6). These corporate values were so strong and dominant that it affected day to day business (Concept of core values, Lencioni, Pg6). Top level management, CEO’s and board members were hired in line with the culture and shared the same values that have existed. Deviation from the values sometimes has resulted in rapid turnover of top level management. This strong culture stemmed from its founder Yvon Chouinard establishing strong set of values that had initially worked well for the company (Strong Culture,
Greenberg, 371).

Due to the continued success, these values permeated through the company even

without Yvon being involved in a formal position (Organizational memory, Greenberg, Pg 375).
As stated above the corporate responsibility to environment is a core value that the company practices. The described values above have been and continually influence the employee and management decisions on business strategy (Values influence strategy, Lencioni, Pg7) . There was a clear direction from management that corporate responsibility was as important as profit. This was indicated in several decisions taken by management. Choosing from less environmentally damaging dye to reducing packaging, environment has been in the forefront of all decisions taken by the company. For example, removing anti-odor chemicals from their clothing line due to its health and environmental effects. Although the market for anti-odor clothing was growing at the time, Patagonia clearly in keeping with their values let go of market share concerning these

Patagonia Case Study - Harsha Narravula products. There were several other numerous examples to illustrate the continued responsibility towards the environment (Level 1, 2 Artifacts& Espoused values, Schein, Pg 22). In 1996, they made a decision to manufacture all cotton products from organically produced cotton due to greater environment footprint used by regular cotton. This bold decision was made in spite of incremental cost and limitation of its raw materials. Due to its environmental friendly actions, Patagonia knows that they cannot expand quickly even though there is demand for its products. Keeping in line with the culture, Patagonia strategized and distributes its products to about 900-1000 dealers in comparison to other manufactures that flood the market by ranging up to 4000 dealers. They also continuously encourage customer to recycle and re-use products thereby reducing the environment foot print and also reduce pressure on their product demands. The company also made sure that these qualities were instilled in the vendors they did business with.
Patagonia also valued and practiced the culture of innovation and quality. They invested heavily in research and developed durable and recyclable fabrics that have been adopted across industry.
Over the years, Patagonia had also patented numerous technologies such as Synchilla (recycled polyester fleece) and Capilene (moisture wicking polyester fabric). These kind of innovations and industry patents were only possible as Patagonia encouraged entrepreneurial spirit rather than to strictly pursue profits (Adhocracy culture, Geenberg, Pg 374).
Patagonia also made quality their utmost priority and this was one of the primary reasons why they could sell 20% to 50% more than their competitors. Offering multifunctional to long lasting products was adding to its advantage over it competitors (Level 1, 2 Artifacts& Espoused values, Schein,
Pg 22).

In order to sustain excellence in quality, Patagonia regularly tested its products through

constant field testing. By offering quality products, the average life cycle of products greatly

Patagonia Case Study - Harsha Narravula increased and thereby enabling them to keep up with demand. This culture has been shaped from years of success and is the foundation of the company.
The marketing strategy also made use of its core values and this proved to be a competitive advantage. Despite spending less than 1% of sales on marketing, the company generated a lot of goodwill and publicity among customers .The Company always thoroughly communicated the environmental initiatives such as “Footprint chronicles” undertaken by the company (Promote values every turn, Lencioni, Pg9).

They involved the customers in lot of their environment initiatives. Their

innovative methods of building product such as Synchilla fleece earned them paid publicity even without marketing themselves extensively.
Along with the above business strategies, the company stayed consistent (with values) on how they hire and treat their employees (Weave core values into everything, Lencioni, Pg8). As stated earlier, employees were chosen on environmental concern and innovative characteristics. Even the company headquarters reflected their values and ethos. Every building owned by the company was engineered in an environment friendly way sending clear signals to all concerned (employees, vendors, customers, etc.) on how of business is done and expected. Since the employees were all likeminded people and with generous perks, the company seemed like a family more than a place of business. This resulted in less employee turnover than industry standards.
Patagonia culture should be viable for its long term growth provided that all its current values are kept in mind while making future decisions. High sales revenue (of 10%) seem to be a target rather than a value, the ultimate goal of Patagonia is to achieve (not high) but optimal sales targets with its current values such as corporate responsibility, innovation and quality.

Patagonia Case Study - Harsha Narravula
Works Cited
1. Managing Behavior in Organizations – J. Greenberg
2. Corporate Culture Survival Guide – E. Schein
3. Make your values mean something – P. lencioni