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Culture. It’s probably a word you hear often if you follow blogs on entrepreneurship or read articles on business and management. But what is it exactly?
According to Frances Frei and Anne Morriss at Harvard Business Review:
“Culture guides discretionary behavior and it picks up where the employee handbook leaves off. Culture tells us how to respond to an unprecedented service request. It tells us whether to risk telling our bosses about our new ideas, and whether to surface or hide problems. Employees make hundreds of decisions on their own every day, and culture is our guide. Culture tells us what to do when the CEO isn’t in the room, which is of course most of the time.”
This post will cover all of the elements that make great culture. Each culture has different tactics and unique qualities. But, universally, culture is about the employees and making sure they have a fun and productive working environment.
Let’s dive in.
Why Should You Care about Culture?
The workplace should not be something that people dread every day. Employees should look forward to going to their jobs. In fact, they should have a hard time leaving because they enjoy the challenges, their co-workers, and the atmosphere. Jobs shouldn’t provoke stress in employees. While the work may be difficult, the culture shouldn’t add to the stress of the work. On the contrary, the culture should be designed to alleviate the work related stress.
This is why culture matters. Culture sustains employee enthusiasm.
You want happy employees because happiness means more productivity. And when a business is more productive, that means it is working faster; and when it works faster, it can get a leg up on the competition. So it’s worth the investment for companies to build and nourish their culture.
Culture is also a recruiting tool. If you’re looking to hire talented people, it doesn’t make sense to fill your office with cubicles and limit employee freedom. You’ll attract mediocre employees, and you’ll be a mediocre company. If, on the other hand, you have an open working environment with lots of transparency and employee freedom, you’ll attract talent. From the minute people walk in the office, they should know that this is a different place with a unique culture.
When you put a focus on culture, you’ll have guiding principles. People will know you for this. Employees will live by it. It’ll help get you through difficult times. You’ll base hiring and firing decisions on the principles. It’ll help get all employees working on the same company mission. In some sense, it’s the glue that keeps the company together.
A company culture that facilitates employee happiness means lower turnover and better company performance. Employees are loyal and companies perform better. It’s a win-win.
If your company ramps up to more employees, the culture will become a self-selecting mechanism for employees and candidates. The people who would fit into your culture become attracted to it and may end up with a job. For example, at Amazon, they look for inventors and pioneers. People who want to work there know this and are attracted by it.
Now, let’s get into the elements that make great company culture…
1. Hiring People Who Fit Your CultureTech Journalist Robert Scoble meets with a lot of CEOs. And when talking about hiring decisions, they always try to make sure they don’t hire jerks. It’s for this reason that companies have such a rigorous hiring process. Some companies like to bring job candidates in to work with their employees for a week. They give the candidates a project and see how they work and how they work with others.
In a post on Harvard Business Review, Eric Sinoway breaks down types of employees and how they impact company culture. The high performing employees who don’t fit into your culture are known as vampires. These vampires must be terminated because, while performance is solid, they’re attitude is detrimental to company culture, which is detrimental to business.
Zappos CEO Tony Hsieh, one of the strongest advocates of culture, makes a great point when he notes that the people you hire represent your company even outside of work. If you meet someone and they tell you where they work, your perception of that place will change based on your opinion of the person. If they’re nice, you’ll view the company in a positive light. If they’re a jerk, you won’t view the company favorably. This effect can be even greater when it’s a company you’ve never heard of and didn’t previously have any opinion of. If the person is helpful, you’ll view the company as helpful. This is why it’s important to hire people who share your company’s values.
One bad hire can affect an entire department and possibly dozens of customers. And it can happen quickly, acting like a virus that spreads. The employees will talk about the bad hire; and if action isn’t taken, it can get much worse.
But the good thing is that any damage can be reversed. And more than that, your values can be reinforced at the same time. If you release that toxic employee (the vampire), it’ll show other employees that you appreciate them and are serious about your culture.
2. Having Employees Know the Values and the Mission of the CompanyThere’s a question that often gets asked in job interviews:
Why do you want to work here?
The purpose of the question is to provide the interviewer with a sense of what the interviewee knows about the company. If the interviewee can provide a specific, pointed reason for why they want to join that company, it shows the interviewer they’ve done research on the company and may be a fit for the position.
Of course, an interview will show only so much. A person can be whoever they want to be for 30-60 minutes. The only real way to know if someone is on board with the values and mission of a company is to watch them work for an extended period of time. Do they follow the same values in their personal life? This is why you need to really get to know the serious candidates.
Zappos has their core values. They guide how employees work and enjoy their personal lives.
When employees are passionate about the values and mission (like organizing the world’s information at Google), they are dedicated to accomplishing the goal.
In a video on the Facebook Careers page, Mark Zuckerberg says:
“The reason why we’ve built a company is because I think a company is by far the best way to get the best people together and align their incentives around doing something great.”
At Facebook, it’s about making the world more open and connected. These drive the employees, guide the product, and energize the entire company. If an employee isn’t committed to the mission, it just becomes another job. And when it’s just another job, it usually means the employee isn’t happy.
On the other hand, when the employee is on board with the mission, they’re engaged in the job and want to help the mission succeed, thus helping the company succeed.
3. Knowing That Good Decisions Can Come from AnywhereNo one has all the answers. A company where only management makes decisions is a surefire way to send A and B players away to other companies.
As some companies get bigger, they tend to limit employee freedom. The employees are less and less involved in key decisions and their impact on the business is drowned out. It becomes a part of the culture. Employees go to work, do what they’re told, and just help someone else achieve their dream. The worker’s impact on the business is minimal and they become “just another employee at just another company.” And for some people, it’s all they want: go into work, take orders, do the job, and wait for the clock to hit 5:00 P.M.
But this is not what the best employees want.
They want to have a voice and a meaningful impact on the company and its direction. They know that anyone can win a debate with the most senior person at a company. They also know they can create tools for the company without the need for management approval.
For instance, the Google News tool was created by a research scientist at Google named Krishna Bharat. Creating Google News wasn’t something that came from a management meeting and descended upon Bharat. He invented it after the September 11 attacks because he figured “it would be useful to see news reporting from multiple sources on a given topic assembled in one place.” It came from a problem that he was having; he wasn’t instructed to create it.
Companies have greater success when employees are given this type of freedom that isn’t ruled by a hierarchy, assuming they’re talented employees who fit the culture. Knowing that good decisions can come from anywhere and expanding employee freedom are cornerstones of attracting talented individuals who will fit into the culture if you let them.
4. Realizing You’re a Team and Not a Bunch of IndividualsEver notice how many CEOs refer to their employees as a “team”?
On the Instagram jobs page, they refer to themselves as a team, not a company.
Culture. It’s probably a word you hear often if you follow blogs on entrepreneurship or read articles on business and management. But what is it exactly?
According to Frances Frei and Anne Morriss at Harvard Business Review:
“Culture guides discretionary behavior and it picks up where the employee handbook leaves off. Culture tells us how to respond to an unprecedented service request. It tells us whether to risk telling our bosses about our new ideas, and whether to surface or hide problems. Employees make hundreds of decisions on their own every day, and culture is our guide. Culture tells us what to do when the CEO isn’t in the room, which is of course most of the time.”
This post will cover all of the elements that make great culture. Each culture has different tactics and unique qualities. But, universally, culture is about the employees and making sure they have a fun and productive working environment.
Let’s dive in.
Why Should You Care about Culture?
The workplace should not be something that people dread every day. Employees should look forward to going to their jobs. In fact, they should have a hard time leaving because they enjoy the challenges, their co-workers, and the atmosphere. Jobs shouldn’t provoke stress in employees. While the work may be difficult, the culture shouldn’t add to the stress of the work. On the contrary, the culture should be designed to alleviate the work related stress.
This is why culture matters. Culture sustains employee enthusiasm.
You want happy employees because happiness means more productivity. And when a business is more productive, that means it is working faster; and when it works faster, it can get a leg up on the competition. So it’s worth the investment for companies to build and nourish their culture.
Culture is also a recruiting tool. If you’re looking to hire talented people, it doesn’t make sense to fill your office with cubicles and limit employee freedom. You’ll attract mediocre employees, and you’ll be a mediocre company. If, on the other hand, you have an open working environment with lots of transparency and employee freedom, you’ll attract talent. From the minute people walk in the office, they should know that this is a different place with a unique culture.
When you put a focus on culture, you’ll have guiding principles. People will know you for this. Employees will live by it. It’ll help get you through difficult times. You’ll base hiring and firing decisions on the principles. It’ll help get all employees working on the same company mission. In some sense, it’s the glue that keeps the company together.
A company culture that facilitates employee happiness means lower turnover and better company performance. Employees are loyal and companies perform better. It’s a win-win.
If your company ramps up to more employees, the culture will become a self-selecting mechanism for employees and candidates. The people who would fit into your culture become attracted to it and may end up with a job. For example, at Amazon, they look for inventors and pioneers. People who want to work there know this and are attracted by it.
Now, let’s get into the elements that make great company culture…
1. Hiring People Who Fit Your CultureTech Journalist Robert Scoble meets with a lot of CEOs. And when talking about hiring decisions, they always try to make sure they don’t hire jerks. It’s for this reason that companies have such a rigorous hiring process. Some companies like to bring job candidates in to work with their employees for a week. They give the candidates a project and see how they work and how they work with others.
In a post on Harvard Business Review, Eric Sinoway breaks down types of employees and how they impact company culture. The high performing employees who don’t fit into your culture are known as vampires. These vampires must be terminated because, while performance is solid, they’re attitude is detrimental to company culture, which is detrimental to business.
Zappos CEO Tony Hsieh, one of the strongest advocates of culture, makes a great point when he notes that the people you hire represent your company even outside of work. If you meet someone and they tell you where they work, your perception of that place will change based on your opinion of the person. If they’re nice, you’ll view the company in a positive light. If they’re a jerk, you won’t view the company favorably. This effect can be even greater when it’s a company you’ve never heard of and didn’t previously have any opinion of. If the person is helpful, you’ll view the company as helpful. This is why it’s important to hire people who share your company’s values.
One bad hire can affect an entire department and possibly dozens of customers. And it can happen quickly, acting like a virus that spreads. The employees will talk about the bad hire; and if action isn’t taken, it can get much worse.
But the good thing is that any damage can be reversed. And more than that, your values can be reinforced at the same time. If you release that toxic employee (the vampire), it’ll show other employees that you appreciate them and are serious about your culture.
2. Having Employees Know the Values and the Mission of the CompanyThere’s a question that often gets asked in job interviews:
Why do you want to work here?
The purpose of the question is to provide the interviewer with a sense of what the interviewee knows about the company. If the interviewee can provide a specific, pointed reason for why they want to join that company, it shows the interviewer they’ve done research on the company and may be a fit for the position.
Of course, an interview will show only so much. A person can be whoever they want to be for 30-60 minutes. The only real way to know if someone is on board with the values and mission of a company is to watch them work for an extended period of time. Do they follow the same values in their personal life? This is why you need to really get to know the serious candidates.
Zappos has their core values. They guide how employees work and enjoy their personal lives.
When employees are passionate about the values and mission (like organizing the world’s information at Google), they are dedicated to accomplishing the goal.
In a video on the Facebook Careers page, Mark Zuckerberg says:
“The reason why we’ve built a company is because I think a company is by far the best way to get the best people together and align their incentives around doing something great.”
At Facebook, it’s about making the world more open and connected. These drive the employees, guide the product, and energize the entire company. If an employee isn’t committed to the mission, it just becomes another job. And when it’s just another job, it usually means the employee isn’t happy.
On the other hand, when the employee is on board with the mission, they’re engaged in the job and want to help the mission succeed, thus helping the company succeed.
3. Knowing That Good Decisions Can Come from AnywhereNo one has all the answers. A company where only management makes decisions is a surefire way to send A and B players away to other companies.
As some companies get bigger, they tend to limit employee freedom. The employees are less and less involved in key decisions and their impact on the business is drowned out. It becomes a part of the culture. Employees go to work, do what they’re told, and just help someone else achieve their dream. The worker’s impact on the business is minimal and they become “just another employee at just another company.” And for some people, it’s all they want: go into work, take orders, do the job, and wait for the clock to hit 5:00 P.M.
But this is not what the best employees want.
They want to have a voice and a meaningful impact on the company and its direction. They know that anyone can win a debate with the most senior person at a company. They also know they can create tools for the company without the need for management approval.
For instance, the Google News tool was created by a research scientist at Google named Krishna Bharat. Creating Google News wasn’t something that came from a management meeting and descended upon Bharat. He invented it after the September 11 attacks because he figured “it would be useful to see news reporting from multiple sources on a given topic assembled in one place.” It came from a problem that he was having; he wasn’t instructed to create it.
Companies have greater success when employees are given this type of freedom that isn’t ruled by a hierarchy, assuming they’re talented employees who fit the culture. Knowing that good decisions can come from anywhere and expanding employee freedom are cornerstones of attracting talented individuals who will fit into the culture if you let them.
4. Realizing You’re a Team and Not a Bunch of IndividualsEver notice how many CEOs refer to their employees as a “team”?
On the Instagram jobs page, they refer to themselves as a team, not a company.
Organizational Culture is Harmony between Management, Employees and Resources and the mode that drives all direct and indirect stakeholders towards just One objective....
Employee engagement.
Transparent communication.
Behavior is the most important pillar of organizational culture. Behavior of employees as a team, behavior of management and strategy and the focus towards behavioral change. The effort towards this change should come from management, if they change behavior, others will eventually follow.... my 2 cents
Must be understanding and respect for all the cultural.
All the principals that are good for life in general and for management shall be deemed important for the organization as well. However, the most important principal shall be to hire only such persons that can move along or at least survive in the organization's culture. Higher management shall have a clear understanding of whatever culture has developed in the organization. If a change is desired, the end goal shall be chosen and a strategy that would lead to that goal in a gradual manner be determined.
This is very interesting question wherein we cant keep writing for hours. However juts to cut the story short i would like emphasize only on one dimension for the same and that is the role of top management. In my opinion building and sustaining organizational culture lies on the shoulders of top management. If the management is not so serious about something then its just a waste to call it a culture.
How often have you heard somebody — a new CEO, a journalist, a management consultant, a leadership guru, a fellow employee — talk about the urgent need to change the culture? They want to make it world-class. To dispense with all the nonsense and negativity that annoys employees and stops good intentions from growing into progress. To bring about an entirely different approach, starting immediately.
These culture critiques are as common as complaints about the weather — and about as effective. How frequently have you seen high-minded aspirations to “change the culture” actually manage to modify the way that people behave and the way in which they work? And how often have you seen noticeable long-term improvements?
If the answer to these last two questions is “rarely,” it wouldn’t surprise us. We don’t believe that swift, wholesale culture change is possible — or even desirable. After all, a company’s culture is its basic personality, the essence of how its people interact and work. However, it is an elusively complex entity that survives and evolves mostly through gradual shifts in leadership, strategy, and other circumstances. We find the most useful definition is also the simplest: Culture is the self-sustaining pattern of behavior that determines how things are done.
Made of instinctive, repetitive habits and emotional responses, culture can’t be copied or easily pinned down. Corporate cultures are constantly self-renewing and slowly evolving: What people feel, think, and believe is reflected and shaped by the way they go about their business. Formal efforts to change a culture (to replace it with something entirely new and different) seldom manage to get to the heart of what motivates people, what makes them tick. Strongly worded memos from on high are deleted within hours. You can plaster the walls with large banners proclaiming new values, but people will go about their days, right beneath those signs, continuing with the habits that are familiar and comfortable.
But this inherent complexity shouldn’t deter leaders from trying to use culture as a lever. If you cannot simply replace the entire machine, work on realigning some of the more useful cogs. The name of the game is making use of what you cannot change by using some of the emotional forces within your current culture differently.
Three dimensions of corporate culture affect its alignment: symbolic reminders (artifacts that are entirely visible), keystone behaviors (recurring acts that trigger other behaviors and that are both visible and invisible), and mind-sets (attitudes and beliefs that are widely shared but exclusively invisible). Of these, behaviors are the most powerful determinant of real change. What people actually do matters more than what they say or believe. And so to obtain more positive influences from your cultural situation, you should start working on changing the most critical behaviors — the mind-sets will follow. Over time, altered behavior patterns and habits can produce better results.
You may be asking: If it is so hard to change culture, why should we even bother to try? Because an organization’s current culture contains several reservoirs of emotional energy and influence. Executives who work with them can greatly accelerate strategic and operating imperatives. When positive culture forces and strategic priorities are in sync, companies can draw energy from the way people feel. This accelerates a company’s movement to gain competitive advantage, or regain advantages that have been lost.
Research shows that companies that use a few specific cultural catalysts — that is to say, those that use informal emotional approaches to influencing behavior — are significantly more likely to experience change that lasts. Of the companies that reported consciously using elements of their culture in Strategy&’s 2013 Global Culture & Change Management Survey, 70 percent said their firms achieved sustainable improvement in organizational pride and emotional commitment. That compares with 35 percent for firms that didn’t use culture as a lever. Although there is no magic formula, no brilliant algorithm, no numerical equation that will guarantee results, we have gleaned some valuable insights through decades of research and observation at dozens of enterprises, including some of the most successful companies in the world. By adopting the following principles, your organization can learn to deploy and improve its culture in a manner that will increase the odds of financial and operational success.
1. Work with and within your current cultural situations. Deeply embedded cultures cannot be replaced with simple upgrades, or even with major overhaul efforts. Nor can your culture be swapped out for a new one as though it were an operating system or a CPU. To a degree, your current cultural situation just is what it is — and it contains components that provide natural advantages to companies as well as components that may act as brakes. We’ve never seen a culture that is all bad, or one that is all good. To work with your culture effectively, therefore, you must understand it, recognize which traits are preeminent and consistent, and discern under what types of conditions these traits are likely to be a help or a hindrance. Put another way, there’s both a yin and a yang to cultural traits.
For example, a European pharmaceutical company with a solid product development pipeline had a tendency to be inward-looking. It had great execution capabilities and an excellent record of compliance with regulators around the world. However, when new products were ready to be launched, the company had a hard time marketing them to physicians and healthcare providers. Rather than bemoaning the company’s ingrained insularity — for example, its collective tendency to value the opinions of internal colleagues more than those of outside experts — the leaders decided to use this feature of its culture to its advantage. They set up a program through which employees were acknowledged and rewarded by colleagues for “going the extra mile” to support customers. By recognizing a new kind of internal authoritativeness, the company tapped a powerful emotional trigger already in place, and engendered a new (and strategically important) behavior in its sales force. This is one of the most important organizational culture.
2. Change behaviors, and mind-sets will follow. It is a commonly held view that behavioral change follows mental shifts, as surely as night follows day. This is why organizations often try to change mind-sets (and ultimately behavior) by communicating values and putting them in glossy brochures. This technique didn’t work well for Enron, where accounting fraud and scandal were part of everyday practice, even as the company’s espoused values of excellence, respect, integrity, and communication were carved into the marble floor of the atrium of its global headquarters in Houston. In reality, culture is much more a matter of doing than of saying. Trying to change a culture purely through top-down messaging, training and development programs, and identifiable cues seldom changes people’s beliefs or behaviors. In fact, neuroscience research suggests that people act their way into believing rather than thinking their way into acting. Changes to key behaviors — changes that are tangible, actionable, repeatable, observable, and measurable — are thus a good place to start. Some good examples of behavior change, which we’ve observed at a number of companies, relate to empowerment (reducing the number of approvals needed for decisions), collaboration (setting up easy ways to convene joint projects), and interpersonal relations (devising mutually respectful practices for raising contentious issues or grievances).
A telecommunications company was seeking to improve its customer service. Rather than trying to influence mind-sets by, for example, posting signs urging employees to be polite to disgruntled customers, or having employees undergo empathy training, the company focused on what psychologists call a “precursor behavior” — a seemingly innocuous behavior that reliably precedes the occurrence of problem behavior. Leaders had noticed that poor teaming led to poor customer service, so the company rolled out a plan to encourage better and more effective teaming within call centers. To accomplish this, they set up regular design sessions for improving practices. When employees felt they were part of a happy team, and sensed a greater level of support from colleagues, they began treating their customers better.
In another example, a resources company in the Middle East was seeking to make its workplace safer. Rather than erect placards threatening workers with consequences, the company focused on a relatively basic precursor behavior: housekeeping. It organized a litter drive. Picking up trash as a team helped employees take greater pride in the workplace, which engendered a greater sense of care for fellow employees and made them more likely to speak up when they noticed an unsafe situation. Changed behavior, changed mind-set. This is one of the most important organizational culture.
3. Focus on a critical few behaviors. Conventional wisdom advocates a comprehensive approach — everybody should change everything that’s not perfect! But companies must be rigorously selective when it comes to picking behaviors. The key is to focus on what we call “the critical few,” a small number of important behaviors that would have great impact if put into practice by a significant number of people. Discern a few things people do throughout the company that positively affect business performance — for example, ways of starting meetings or talking with customers. Make sure those are aligned with the company’s overall strategy. Also check that people feel good about doing these things, so that you tap into emotional commitment. Then codify them: Translate those critical behaviors into simple, practical steps that people can take every day. Next, select groups of employees who are primed for these few behaviors, those who will respond strongly to the new behaviors and who are likely to implement and spread them.
At an Asian banking company, rapid inorganic growth had led to diverse ways of working across different units and geographies. To focus on improving teaming, customer outcomes, and the ability to realize synergies, the CEO and leadership embarked on a culture-led evolution program. They targeted just three critical behaviors: taking extra steps to delight customers, valuing performance over seniority, and backing up and supporting one another. They then converted these three general behaviors into specifics for each part of the company. Delighting customers, for instance, was translated into frontline staff collaborating with other colleagues to solve client problems and prioritizing the implementation of process improvements that affected customer outcomes. For all three behaviors, leadership recognized and celebrated examples in which people made an extraordinary effort. Senior leaders acted as role models, explicitly modeling these three new behaviors. The company also identified influential frontline, client-facing employees who could demonstrate these new behaviors in action. This is one of the most important organizational culture.
4. Deploy your authentic informal leaders. Authority, which is conferred by a formal position, should not be confused with leadership. Leadership is a natural attribute, exercised and displayed informally without regard to title or position in the organizational chart. Because authentic informal leaders, who are found in every organization, are often not recognized as such, they are frequently overlooked and underused when it comes to driving culture. It is possible to identify such leaders through interviews, surveys, and tools such as organizational network analysis, which allow companies to construct maps of complex internal social relations by analyzing email statistics and meeting records. Once identified, these leaders can become powerful allies who can influence behavior through “showing by doing.” In fact, when companies map out their organizations, they can identify leaders who exhibit different core leadership strengths (see “Four Types of Authentic Informal Leaders”).
At one major oil company, an informal leader named Osama became known as the “turbo-collaborator.” His role gave him very little formal influence. But when he began working at the refinery, he walked the plant with the engineers, maintenance technicians, and operators, and took copious notes. As a result, he knew everyone and developed relationships across disciplines. Whenever somebody wanted to know how the place really worked, they would speak to Osama — who would either have the answer in his notebook or know precisely the right person to ask. When the company formed a buddy program between operations and maintenance aimed at using greater collaboration to improve plant reliability, it knew it needed Osama at the heart of it. He connected people, defined templates to encourage collaboration, and captured success stories. Identifying, engaging, and nurturing such informal leaders allows companies to harness their talents and further the company’s transformation efforts. This is one of the most important organizational culture.
5. Don’t let your formal leaders off the hook. Most organizations tend to shunt culture into the silo of human resources professionals. But leaders in all parts of the company are critical in safeguarding and championing desired behaviors, energizing personal feelings, and reinforcing cultural alignment. The signaling of emotional commitment sets the tone for others to follow. If staff members see a disconnect between the culture an organization promulgates and the one its formal leadership follows, they’ll disengage quickly from the advertised culture and simply mimic their seniors’ behavior. The people at the top have to demonstrate the change they want to see. Here, too, the critical few come into play. A handful of the right kind of leaders have to be on board to start the process.
When Jim Rogers was CEO of GE Motors in Fort Wayne, Ind., he became frustrated because his senior leadership group of more than 15 leaders seldom functioned together as a “real team.” As described by Jon Katzenbach and Douglas K. Smith in The Wisdom of Teams: Creating the High-Performance Organization (Harvard Business School Press, 1993), a real team is one with a high level of emotional commitment; the leadership role shifts easily among the members depending on their skills and experience and the challenges of the moment, rather than on any hierarchical positions. Team members hold one another accountable for the quality of their collective work. Interestingly, at GE Motors the senior leadership group members often demonstrated real team capabilities in running their individual business units and functions. So Rogers decided to find ways to break them into subteams of three or four members to address specific cross-organizational issues facing the larger group. Over time, he mixed the subgroupings to match emerging issues. By working in different subgroup settings, the executives developed camaraderie, which in turn improved the effectiveness of the group as a whole. This is one of the most important organizational culture.
6. Link behaviors to business objectives. When people talk about feelings, motivations, and values — all of which are vital elements of strong cultures — the conversation can often veer into abstractions. It may then range far afield of what it takes to succeed in the market. Too many employees walk away from culture-focused town halls or values discussions wondering how the advice on how to be a better person actually translates into the work they do. To avoid this disconnect, offer tangible, well-defined examples of how cultural interventions lead to improved performance and financial outcomes. Select behaviors that are aimed specifically at improving business performance and can be measured over time.
An oil company’s drive to reduce maintenance costs at an industrial installation highlights the importance of such an approach. The critical few behaviors included empowerment and good decision making. One of the company’s exemplars (employees who lead by example) decided it would be a smart move to make costs visible to workers. So he placed price tags on various pieces of machinery. These cues inspired behavioral changes related to decisions about whether to repair or replace equipment. Workers and managers began to recommend fixing expensive equipment rather than replacing it. The company celebrated and publicized cost savings identified by employees. The behaviors led to a change in focus and mind-set. When an employee noticed that fans were cooling the machinery during the winter, he felt empowered to call it out, and ask whether it was necessary to do so. It turned out that it wasn’t — and the company saved US$750,000 annually in power costs as a result. This is one of the most important organizational culture.
7. Demonstrate impact quickly. We live in an age of notoriously short attention spans. That applies as much to organizational culture as it does to people’s media consumption habits. When people hear about new high-profile initiatives and efforts, and then don’t see any activity related to them for several months, they’ll disengage and grow cynical. That’s why it is extremely important to showcase the impact of cultural efforts on business results as quickly as possible. One effective method of doing so is to stage performance pilots — that is, high-profile demonstration projects. Pilots are relatively low-risk efforts that introduce specific behaviors that can then be evaluated and assessed. They often rely on a dashboard that defines desired impacts, the tactics used, and the specific metrics to be employed.
When Bell Canada first explored using new behaviors at the front line to improve its customer service and profitability, there were many more skeptics than believers within the leadership ranks. There simply wasn’t any numerical proof that the tactics would work. So CEO Michael Sabia decided to set up a pilot test in a sales unit near Toronto. The sponsors of the test blocked out a tight time frame of eight months, and developed realistic ways of measuring behavior change, customer reactions, and actual sales and margin performance. Armed with positive results in these areas — a 29 percent increase in customer satisfaction in retail stores, a 31 percent increase in revenue per call at call centers — the company went on to accelerate the expansion of these efforts across the front line in different geographies, functions, and businesses. This is one of the most important organizational culture.
8. Use cross-organizational methods to go viral. Ideas can spread virally across organizational departments and functions, as well as from the top down and from the bottom up. One powerful way to spread ideas is through social media: blogs, Facebook or LinkedIn posts, and tweets — not from senior management, but from some of the authentic informal leaders mentioned in Principle 4.
By now it is well established that social media can be more effective at spreading information, news, and music than traditional modes of distribution. The same holds with critical behaviors. People are often more receptive to changes in “the way we do things around here” when those changes are recommended or shared by friends, colleagues, and other associates. This kind of credible social proof is more compelling than similar testimonials from someone whose job it is to sell something.
Just as there is an art to making content go viral, there’s a craft to making behavior go viral. For example, in a model that we have tested successfully in several situations, a company starts with a few carefully chosen groups of 12 to 15 informal leaders in three or four different parts of the business. After several weeks, an additional 10 to 15 groups of informal leaders are set up in every business unit. After about three months, the existing groups are encouraged to expand and bring in new people. After another three to six months have passed, the groups become more autonomous, allowed to control their own expansion. Meanwhile, the company facilitates connections among groups to share learning and insights. As behavior spreads, company leaders see increased performance as well as peer and leadership recognition. This is one of the most important organizational culture.
9. Align programmatic efforts with behaviors. We’ve emphasized the role that informal leaders can play in helping ideas go viral. But it’s also important to match the new cultural direction with existing ways of doing business. Informal mechanisms and cultural interventions must complement and integrate with the more common formal organization components, not work at cross-purposes. By providing the structure in which people work — through disciplines such as organization design, analytics, human resources, and lean process improvement — the formal organization provides a rational motivation for employee actions, while the informal organization enables the emotional commitment that characterizes peak performance.
The U.S. Marine Corps provides a classic example of integrating formal and informal leadership efforts. The “rule of three” dictates how the Marines design their organizations and projects and how they execute in a hierarchy. (Three squads form into one of three divisions, which form one of three battalions.) The formal leaders of those units are expected to know the intent of the officer two levels above them — and to call out any order or situation they perceive to be incoherent or in conflict with that intent. But there are also informal leaders: Each of the four members of a frontline rifle team is prepared (and expected) to take the lead whenever the formal leader is disabled or loses the high-ground position. This means that the informal leaders also need to know the intent of that officer two levels above. Integrating informal norms with the formal structures helps enable the timely battlefield adjustments that have served the Marine Corps well for more than 200 years. This is one of the most important organizational culture.
10. Actively manage your cultural situation over time. Companies that have had great success working with culture — we call them “culture superstars” — actively monitor, manage, care for, and update their cultural forces. Why? As we noted at the outset, when aligned with strategic and operating priorities, culture can provide hidden sources of energy and motivation that can accelerate changes faster than formal processes and programs. Even if you have a highly effective culture today, it may not be good enough for tomorrow. This is one of the most important organizational culture.
Source: strategy-business.com
