Tag Archives: culture change

Lesson 3: The Leader’s Culture Change Toolkit

Encouraging words for leaders who are trying to change their culture for the better.

Most leaders already have the fundamental skills required to effectively lead culture change. They are terrific problem solvers and action-oriented. When faced with a challenge, they shift into solution mode relying on personal experience and the advice of trusted colleagues and subject matter experts to identify the best approach for the situation. They search their bank of past successes and lessons learned to identify actions they believe will deliver the desired results. Many of these include behaviors, practices and systemic changes to structures, processes, policies and so on.
This is what Bill did so well as told in the story in Lesson #1. He used behaviors, practices, stories (remember the one about the cell phone and locking the CEO out of the meeting room for showing up late), structure and processes to create a more disciplined culture. In other words, he intentionally used the tools in his personal toolkit to achieve and sustain a significant change in culture.

The Personal Culture Change Toolkit

So, what is the leader’s personal culture change toolkit? Basically, it consists of the tangible elements of day-to-day life in an organization. These fall into two categories: people and environment. People tools refer to the actions that convey what is important and valued to individuals and teams. These are shared primarily through social interactions, such as observation and first-hand experience. The environment tools are the ‘systemic’ elements of the organization that determine the way people work and interact. These are important as their design can either support and encourage the desired behavior or create significant obstacles to adoption.

People Tools
The ‘people tools’ are the actions explicitly directed at influencing people. Behaviors and practices were introduced in an earlier chapter, so I’ll just provide a brief recap. Behaviors are the oft unconscious actions that we demonstrate in response to different situations. These actions send signals that tell others what is expected and, when the leader is influential, the best way to act. For this reason, it is important that leaders are self-aware and in touch with the ways that their words and actions are influencing others’ behavior and shaping the culture around them. Practices are the repeat patterns of activity or routines that leaders use as they go about their day-to-day work. They are different from processes which are the transformation of an input into an output. An example of a practice is the way you run meetings. If you run your meetings in a structured and disciplined manner, it sends a very different message than if your meetings are ad hoc and infromal. Thoughtfully using a mix of practices is an especially powerful strategy for reinforcing new behaviors and shifting culture.

Stories and Heroes
Stories and heroes refer to the telling of events involving people doing exceptional things. This is a powerful way to send a message about what is valued and important. They can be told in formal and informal settings and through a mix of verbal, written and visual media. The more stories about different people doing something that brings the values and desired behaviors to life, the better. The key is they must be authentic, credible and relatable.

Turtle in a bowl - company cultureThere is a great WestJet Airlines commercial that illustrates this beautifully (https://www.youtube.com/watch?v=o5nfJ_u_8Ws). In the commercial, WestJetter Amanda helps a little girl and her family who find out they can’t bring her pet turtle on the plane. Her solution? She offers to look after ‘Steve’, the turtle, until they return from their vacation. The message is that Amanda is an owner and owners care, which is a core value of the company. This is just one of several videos showing employees going above and beyond to help their customers. It sends a clear message of what is important and valued to employees, customers and any one else who cares to listen. By the way, if you want to really understand your culture, ask people to tell stories about the company at its best and its worse. It is amazing what you will uncover.

Traditions and Rituals
Traditions and Rituals are a forum to celebrate the things that really matter. While common in families and religions, they can also be found in organizations usually taking the form of a special event such as a family picnic, annual profit-sharing celebration or Christmas party. To be considered a tradition or ritual, they must be meaningful and endure the test of time. An example is an annual family picnic that emphasizes the importance the company places on employees and their families, as well as the desire to nourish a sense of family and community within the company itself. If the picnic is only held once, it is a nice gesture. When it is a recurring event held for several years, it becomes a tradition.

Company Picnic - Corporate Culture

Traditions and rituals are usually established by founders and other senior leaders, however, leaders at lower levels can also do something meaningful but on a smaller scale. These events rarely become traditions as circumstances can change limiting their ability to endure over time (i.e., budget cuts, staffing changes etc.). Their power is in the potential to augment the global message by making it personal – this leader personally believes in the importance of family and creating a sense of community.
One of the challenges with traditions, and why it is important to be intentional in using them, is they become part of the company’s identity and embedded in the tacit employment contract. As a result, discontinuing a tradition, such as the family picnic, sends a strong, usually negative, message to employees. This is regardless of how good the reasons and how effective you are communicating them. In the end, employees interpret discontinuing the picnic as the company no longer values employees and their families. They point to other things the company is spending money on as evidence that leaders could continue the picnic but are choosing to do otherwise. This is why cost-cutting initiatives that target these types of events should be carefully considered and the consequences evaluated before taking action. In the end, the long-term impact of cutting the family picnic may far outweigh the short-term benefits.

Environment Tools
Environment tools are the elements of an organization that create the conditions to encourage and sustain new values, behaviors and practices. My favorite way to explain this is to consider what it takes to successfully lose weight. I can change my behavior by modifying my eating habits and going to the gym on a regular basis. I can adopt new practices such as weighing myself weekly, tracking my food intake and attending group support meetings. However, if my kitchen cupboards contain my favorite high-calorie snacks and the gym is 45 minutes from home, chances are sooner or later I am going to fall off the bandwagon. The same thing happens in organizations when leaders articulate new values and expected behaviors but don’t make the environmental changes required to support them. Even when significant time, money and attention is invested in initiatives such as communication and training, a lack of aligned structures, processes, policies and so on sends conflicting messages that discourage change and reinforce existing behaviors.
Now, you might be thinking, these are tools that only leaders in senior positions can use. The truth is every leader, regardless of level, can use the environment tools. However, the scope and scale depends on the leader’s role, responsibilities and level of authority. For example, senior leaders are accountable for the overall design of the organization’s structure providing direction including boundaries and limitations for lower level design efforts. Mid-level managers apply these parameters in designing the structure of their area of responsibility and lower-level managers to the design of their teams. The same applies to processes, policies, systems, space and symbols.

Structure
Structure determines who does what and how decisions are made in pursuit of an organization’s goals. It involves the design of roles, responsibilities, reporting relationships and authority levels. This includes temporary governance structures, such as advisory boards and management committees, as well as team structures. Structure has a powerful effect on culture influencing the ways people work and interact within and across levels, teams, business units, functions and geographies.
As an example, organization structures tend to fall somewhere between hierarchical or mechanistic and organic or flat and can take various forms depending on the company’s operating model. Hierarchical structures tend to provide a clear chain of command however, they can contribute to bureaucracy and slow decision-making. In many hierarchical structures, business units operate independently which means collaboration between groups can suffer. On the other hand, flat structures use teams to respond and adapt quickly to challenges and opportunities which is critical in dynamic external environments. While this allows for faster decision-making, it can lead to confusion and inefficiencies especially as an organization grows. If the teams operate independently, which is often the case, there is also the potential for redundancies and breakdowns in collaboration.

The way functional reporting relationships are designed also affects culture. Specifically, are the functions, such as Sales, Finance and Human Resources, centralized or decentralized? Do the functions report directly to the business units or are they operating as shared service centers providing support to the business units? Perhaps they report directly to a Corporate executive and indirectly to the business units as is common in a matrix structure, or maybe functional roles are fully integrated into project teams as in a flat structure. This is important because the functions own many of the processes and policies that determine the way things get done and thereby affect culture. In some organizations, this includes acting as a ‘gatekeeper’ to ensure consistency and manage risk. Anyone who has had to go through multiple steps to get Legal approval for a contract or business deal knows how this affects culture. Talk about bureaucracy!
While the above examples are part of the senior leader’s toolkit, managers can also use structure to intentionally shape culture albeit not to the same extent. Managers and team leaders typically decide who does what and how employees are going to work together to deliver expected outcomes. For example, in transactional roles such as Accounts Payable and Receivable, jobs are usually designed with efficiency of task completion a priority. This results in discrete roles with very structured job descriptions that offer little flexibility or opportunities for personal growth. The culture, at least within this team, places a high value on normative practices such as process consistency and compliance, as well as orderliness and attention to detail. While this might make perfect sense for the Accounts Payable and Receivable department, the same structure applied to a team of Software Engineers tasked with developing new products would be a disaster. For this team to be productive, the culture needs to encourage collaboration, experimentation (including making mistakes), flexibility, adaptability and responsiveness, as well as execution and results. Rather than narrowly defined roles and job descriptions with clear task allocation, a loose and flexible team structure is a much better option.

Systems, Processes and Policies
Systems, processes and policies (“the system”) are the guidelines and integrated methods and procedures that define how work is to be performed and people are expected to behave. This includes boundaries and limitations, as well as best practices. In my experience, a lack of alignment between “the system” and desired behaviors is one of the most common obstacles to culture change. This is notwithstanding the fact many organizations do a good job aligning Human Resource processes and policies to support desired behaviors.
Talent acquisition and management processes, performance management systems, competency models, employee training and manager development programs, as well as rewards and recognition programs,  are some of the tools typically used to encourage specific behaviors and help change culture. I emphasize ‘help change’ versus ‘change’, as Human Resources processes and policies on their own are rarely sufficient to achieve the desired results. This is not to say they aren’t important or relevant. They are. The point is that most organizations stop here and don’t make the necessary changes to other parts of the system.
Pretty much every organization has functional groups such as Sales, Legal and Finance. Even small companies have an overarching system of controls to ensure fiduciary, regulatory and legal compliance, at a minimum. As organizations grow, the role of the functions tends to expand and with it their influence over day-to-day work. The need to reduce waste and lower costs, increase efficiency and effectiveness, and reduce risk are just a few of the drivers behind this shift. Now, you might be asking what does this have to do with culture? The answer is a great deal; every function has policies, procedures and processes that affect the way things get done, otherwise known as culture.
Take for example an organization that needs to become more agile in order to compete in an increasingly dynamic and unpredictable marketplace. By increasing agility, the company should be able to respond quickly and adapt to changing circumstances, which is a must in this type of environment. Now, let’s say this same organization is a large, mature global company that insists employees comply with restrictive Finance, Legal and Human Resource policies and procedures when making decisions. For instance, there are strict limits on spending reinforced by delegation of authority (DOA) policies and a rigorous expense approval process. All contracts regardless of the cost, including rental of off-site meeting rooms, require multiple layers of Legal review and approval. Furthermore, senior executives must sign off on all new hires and promotions per Human Resource policies. This isn’t exactly a system designed to foster agility. In fact, some might (and do) call it downright bureaucratic.
How successful do you think the culture change effort will be if these and other relevant policies, processes and procedures remain the way they are? It will fail…100% guaranteed. Even if Human Resources does a terrific job defining the desired behaviors and embedding them in their processes and programs, the change effort will be for not. There is simply too great a disconnect between the desired behaviors and the system. For the company to become more agile, it must make substantial changes to these and other elements of the system at both the macro and micro level.
While the above is an example of the macro level system in action, managers and team leaders play a critical role in identifying the required macro and micro level changes. They work most closely with front-line employees and understand the nuts and bolts of the day-to-day performance of work. If an organization needs to be more agile, it is the lower level managers and front-line employees who can identify the specific changes required to align the system in support of the desired behaviors. Simply asking them what is stopping them from being agile (of course, supported by a clear description of what this means) is guaranteed to elicit useful information about obstacles and potential solutions.

Space
Space refers to the design and use of the physical workplace. It includes micro spaces such as individual and team workspaces; shared spaces such as meeting rooms, cafeterias and collaborative work areas; outdoor spaces such as parking lots, gardens, courtyards and sports fields; and, macro spaces such as building and campus floor plans. Every one of these spaces has the potential to help build and shape culture at the same time as it supports strategy execution and the effective completion of work.

Man working alone in a cubicle - company cultureLet’s say, for example, leaders have identified the need to increase creativity and generate more good ideas in support of innovation. How can the design and use of physical space help or get in the way? Consider for a moment a traditional office building floor plan comprised of walled offices for managers and cubicles for non-managers. These are connected by a hallway that wraps around the central elevator core and stairwell. There are a few meeting rooms located off the hallway also at the core. These are equipped with standard furnishings and decor, such as a table and chairs, speakerphone, screen and projector with computer connections and a few pictures on the walls. Also located at the core are washrooms and a shared supply room that serves a dual purpose providing vending machines that dispense snacks, drinks and coffee. Sound familiar? Space is expensive so companies try to use it as efficiently as possible. This might be fine if people need quiet spaces to focus on their work and complete tasks. However, it is hard to see how this would inspire creativity and idea generation.

Corporate Culture Strategy

Now, contrast this with a workspace specifically designed for this purpose. Perhaps you envision a Google-type workplace where the design of space encourages people to come together to interact, play and have fun. Alternatively, maybe you’re thinking of war rooms, coffee shops, team layouts, movable walls, learning labs or other spaces designed with creative collaboration in mind. There are lots of options. The art and science is in the intentional design of space to serve a purpose and fit the people and work they are doing. This purpose can and should include building or changing culture in support of your strategy and goals. While space used in isolation of other tools is not enough to change culture, intentional design can help accelerate change, encourage new behaviors and reinforce values.

Symbols
Symbols are the tangible objects or artefacts that we encounter in the workplace. They include signs, awards, product samples, photos, wall murals and basically anything we can see or touch. Their power is in the meaning they hold for the observer, which can be different depending on the context and person. For example, the image at right is a photo of a poster hanging on the wall of a meeting room at a Toronto Public Relations firm. Take a close look. What is the meaning of the poster?

Hand print artwork - Company culture
Perhaps you thought the following:

  • They are obviously ‘creative’ (and have too much time on their hands)…yep, this was someone’s answer.
  • The hands look like they are from members of a team who probably did something special, hence the ‘High Five’ at the top.
  • Several hands are small, so it is a team made mostly of women.
    The different colors symbolize diversity. Diversity of background, experience and thought is important.
  • People signed their names below their hands, so they recognize not just the team but each team member’s contribution.

The real story behind the poster, as provided by the firm owner, is it is a celebration of the contribution each person makes to the success of the firm. By working together and learning from each other, they create outstanding solutions that are recognized by their clients and the industry (they’ve received multiple industry awards which are displayed in the entrance lobby). Every person brings something unique that makes a difference and continues even after they leave. This is captured in the names beneath the handprints, many of whom are people no longer with the firm. The lesson is that objects and artefacts can be powerful tools for reinforcing values, sharing memories and shaping culture. However, it is important to remember that people can interpret things differently, which means the meaning you intend may not be what is received.
I encountered this recently while being escorted on a tour of a Corporate Headquarter building. Just off the lobby, in a high traffic area, was a wall covered floor to ceiling with a mural depicting the history of the company. Impressed, I commented on some of the themes I noticed such as its longevity, the continuity of leadership and commitment to organic growth versus acquisitions. It seemed to me to suggest an organization that is proud of its heritage, as well as somewhat cautious but has been able to adapt as the world changes. The Director escorting me paused, looked at the mural, looked at me and said, most employees view the mural as company propaganda intended for customers. All the things I say may be true, but employees see the mural as a symbol of resistance to change, out-of-touch leadership, risk aversion and bureaucracy. To them, the company is stuck in the past, whereas it should be focused on the future. Sure, there is a message about the company being a survivor and overcoming challenges, but recent experience is raising questions regarding its ability to change fast enough to be viable in today’s marketplace.
This brings up another important point. There must be congruence between the symbol and people’s experience for it be an effective tool. Symbols can be aspirational, but they must be real and authentic. For example, a company that launches a campaign using events, programs and artefacts to encourage employee engagement would be ill-advised to do so when they are laying off people. Similarly, I encountered a good example recently when visiting a manufacturing site. One of the first things I saw when I entered the building was a sign stating, ‘Safety First – Safety is Everyone’s Responsibility’. Next to it was a large scoreboard itemizing the previous quarter’s performance on key safety indicators. This included the number of incidents, days lost due to accidents, and the number of near misses. This looked great. Obviously, the company is serious about safety, right?
The problem is that, throughout my visit, I saw numerous safety violations starting with me being allowed on the floor without the appropriate gear. What message does this send to employees? For symbols to be effective in building and changing culture they must be meaningful, clearly explained and consistent with people’s lived experience. If not, they can serve to damage the change effort and the leader’s personal credibility.

In Summary

Most culture change initiatives focus on defining values and expected behaviors, which are communicated to managers and employees with the expectation they will demonstrate these behaviors in their work and interactions. Recognizing that telling people to behave differently usually doesn’t produce results, most organizations embed the expected behaviors in Human Resource programs, policies and processes, such as talent acquisition and performance management systems. Some even offer training programs to teach managers how to role model and change behaviour. Yet, these efforts only scratch the surface when it comes to the tools available to change culture.
As we know, engaging leaders is critical for any change effort to be successful. This is especially true in the case of culture change. Every leader influences culture through their words and actions as they go about their day-to-day work. The behaviors they demonstrate, practices they use, stories they tell and traditions they establish serve to reinforce what the organization, and they personally, believe is important and valued. By using these people tools in an intentional manner, leaders set clear expectations for behavior that are reinforced in people’s day-to-day experience. Even better, when they align the work environment by making relevant changes to structure, processes, policies, space and symbols, they create the conditions for the new behaviors to take root and flourish.
The exciting thing is leaders already have access to the tools they need to drive culture change. They are using them now as they go about their work and interact with people. The problem is leaders aren’t aware of these tools or, if they are aware, don’t know how to use them in an intentional manner to change culture. This creates a huge opportunity for most organizations. Instead of taking years, culture change can occur in months by helping leaders learn how to use their personal toolkit and align their efforts to achieve a shared vision of the future.

Dr. Nancie Evans
Dr. Nancie Evans is co-founder and VP Client Solutions at Culture-Strategy Fit Inc. specializing in the alignment of organizational culture and strategy. She has developed a unique set of leading-edge diagnostic tools and approaches that provide leaders with deep insights into the culture of their organizations, how it is supporting or getting in the way of strategy execution, as well as the levers that they can use to drive rapid culture change.

CULTURESTRATEGYFIT®
Culture-Strategy Fit Inc. is a leading culture and executive leadership consulting firm conducting groundbreaking work in leveraging culture to drive strategy and performance. Its suite of culture surveys and culture alignment tools are used by market-leading organizations around the world.

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Lesson #2: Engaging Leaders, Changing Culture

Vector Image of a leader

This article is a draft chapter in Dr. Nancie Evans’ upcoming book, Changing Culture: 30 Years of Lessons Learned. Comments, questions and suggestions are gratefully appreciated. Happy reading!

In an ideal world, senior leaders fully embrace the challenge of changing culture. As explained previously, this means role modeling the expected behaviors, reinforcing them in day-to-day practices, and creating the conditions for success. Unfortunately, I’ve found this rarely happens. It isn’t that leaders don’t understand what it takes to be successful. When asked for examples from their experience, leaders can almost always come up with great stories of both successful and failed efforts. They totally get that they need to lead the way.

Barriers to Leader Engagement

So, what stops leaders from personally owning and fully engaging in culture change? Why do leaders overwhelmingly delegate the heavy-lifting to Human Resources? In years of asking this question to leaders and Human Resource professionals, a few things stand out.

Competing Priorities and Demands

Leaders at all levels and especially those in senior roles are stretched thin. Competing demands mean having to make choices as to where they invest their time, energy and attention. There simply aren’t enough hours in the day and days in the week to do everything. As a result, while culture is viewed by many as important, it often takes a back seat to more urgent demands, such as delivering short-term financial results and day-to-day management of the business. This is not to say they don’t support culture work. In fact, a lot of CEOs and other C-Suite executives sponsor culture change initiatives and personally invest a significant amount of time in defining values, communication and employee engagement. The problem is their involvement falls short of that required to achieve meaningful and sustained change.

Culture Is Vague and Ambiguous

Consider for a moment, the language of business. Products, services, processes, operations, market share, revenues, cost structures and so on are clear and widely understood. Talk about a business process and people know exactly what you mean. It’s tangible with elements that can be measured, analysed and improved. Contrast this with culture which is defined by words like values, beliefs and assumptions or ‘the way things are done around here’. No wonder many leaders’ eyes start to glaze over. Start talking about culture change as requiring a shift in underlying beliefs and we’ve lost them entirely. It is simply too vague and ambiguous to grab their attention.

The Comfort Zone  

Faced with a choice of solving an immediate business problem or getting involved in culture change, the former always wins. Even when there are good intentions, there are always more problems to be solved, plans made, and actions taken causing less urgent matters like culture change to take a back seat. This is simply human nature. When under pressure, we tend to deal first with things that fall into our comfort zone and second with those that are urgent and important. If there is time and energy left, and we are sufficiently motivated and confident in our abilities, we might then take on things that are less urgent but important or urgent but complex such as culture change.

Culture Change Is Personal

Culture change almost always requires a shift in leaders’ behavior. Keeping in mind that employees follow the actions of leaders, not so much their words, this means letting go of behaviors that worked in the past but are detrimental in the new world. It means learning or demonstrating new behaviors that include ones outside their comfort zone or inconsistent with their personal beliefs regarding the most effective way to manage and lead. It can also mean the qualities and capabilities that made a leader successful are no longer valued and might even cause them to fail. This can lead to avoidance in the form of passive resistance or an ‘I’m good but the rest of you need to change’ attitude which undermines the change effort.

Experts Advocate a Behavioral or Values-Based Approach

Most Change Management and Human Resource consultants advocate a behavioral or values-based approach to culture change. In this approach, leaders define the organization’s vision, mission, purpose and values; the latter sometimes in consultation with employees. A lot of effort is directed at sharing the values and engaging employees in building the connection with their personal values. Once finalized, Human Resources translate the values into expected behaviors, often in the form of competency models. The expected behaviors are communicated to employees and embedded in orientation and training programs, as well as talent management processes and performance management systems. This approach is appealing to leaders looking for a solution that doesn’t require a lot of their personal time and attention. The fact that it is advocated by experts also lends it credibility, which gives leaders confidence it is the right way to proceed.

It’s a People Thing

Finally, culture change is generally perceived to be a ‘people thing’. After all, it involves defining values and changing behaviors, right? As this is not an area of expertise for most leaders, it should not be surprising that they happily delegate responsibility to Human Resources. In fact, it makes sense for Human Resources to take the lead on most culture initiatives. Human Resource professionals bring much needed skills and expertise to help leaders through the culture change process. The challenge is to convince leaders to retain ownership of culture change with Human Resources as a strategic partner versus doers.

Strategies for Leader Engagement

Culture change is difficult, personally challenging, time consuming and requires a long-term commitment. All good reasons for leaders to search for an easier alternative that minimizes their involvement, especially given the challenges and demands of their jobs. Yet, they must be fully engaged for culture change to have a chance at success. So how do we convince leaders to own culture change?

What Doesn’t Work?

Let’s start with what doesn’t work. I’ve spent countless hours making presentations to leaders with the objective of convincing them that culture is an important business priority. Facts and figures from various studies illustrate the financial, competitive and other benefits of investing in culture. Great articles and case studies provide compelling arguments for the power of culture change. My own research shows the difference culture can make on innovation, customer loyalty, reliability and operational excellence.

If we’re lucky, this is sufficiently compelling to capture their attention and we can proceed to ‘what’s next?’ A lot of the time, however, the conversation stops here, simply because we’re talking about culture not operating models, strategy, business processes or other ‘hard stuff’. For many leaders, culture is just too vague and intangible. For people who are used to having the answers and knowing what to do, this is the kiss of death.

In the end, the vast majority delegate responsibility for culture and culture change to Human Resources but promise to help in (almost) anyway they can, keeping in mind the competing demands for their time and attention, as well as resources. Unfortunately, this rarely includes making the personal or systemic changes required for the culture to shift in a meaningful or sustained way. The bottom-line is leaders perceive that the cost and effort outweigh the benefits. This is magnified by urgent, short-term and more pressing demands, such as achieving the quarter’s revenue targets.

So, what does work?

This might seem crazy but talking to leaders about culture and the need for culture change simply does not work. That is, it doesn’t work unless you anchor it in a business need and provide a clear, practical solution they can understand. In other words, you have to speak their language and employ a business-driven approach.

Speak Their Language

About 10 years ago, a Human Resource executive told me he wished there was another word for ‘culture’. When asked why, he explained that senior leaders view culture as ‘vague, warm and fuzzy; as an HR thing’. As a result, it was close to impossible to get them to see culture as a business priority requiring the same level of attention as say, achieving financial results, improving business processes or developing strategic plans. I didn’t listen but instead directed my energy at strengthening my case. It was only when I finally changed the way I talked about culture that senior leaders began to really engage. The secret is to use language they understand.

This doesn’t mean avoiding the use of the word ‘culture’. In fact, organizations contact me because they want help with their culture. It is the language we use when we talk about culture where the opportunity exists. Terms like capability instead of culture attributes and expectations rather than behaviors help change the conversation. By using words they can relate to, leaders are more willing to engage in a deep exploration of the challenges and opportunities culture presents.

Take for example Bill, whose story is told in Lesson #1. It reads as if Bill was an enlightened leader intentionally and purposefully leading the way to achieve a meaningful change in culture. The thing is, according to Bill, the changes he made had nothing to do with culture. It was about effective leadership and business management. He solved a significant business problem by increasing the level of discipline with an emphasis on cost management and decision-making. To him, discipline was a capability, not a culture attribute, the organization lacked. He didn’t talk to people about changing the culture and never mentioned values, beliefs or assumptions. He referred to behaviors as expectations as in, “I expect people to be on time for meetings and appointments”. He didn’t involve Human Resources as, to him, he was simply doing his job so why would he need them? He did engage his direct reports to lead the process changes but otherwise did not involve employees. Based on his experience, he believed he knew what needed to be done and didn’t see value in asking people who, in his mind, didn’t have a clue what discipline was about.

I am not advocating that leaders embark on culture change without involving Human Resources. Nor, do I suggest that engaging employees isn’t worthwhile. In fact, both play an important role and are topics for later chapters. The point is culture change, intentional or accidental, can happen fast when leaders are actively engaged and own it.  Changing the way we talk about culture can go a long way towards achieving this, especially when it is accompanied by a business-driven approach.

Use a Business-Driven Approach

Most culture initiatives arise from either a people problem, such as employee attrition or low engagement, or a significant change, such as new senior leadership. Alternatively, a leader might attend a conference, read a book or hear something about culture in the media that catches their attention. While these may be valid reasons for initiating culture work, they rarely lead to the type of leader engagement required to achieve a meaningful outcome. For this to happen, senior leaders must see culture as a business priority on par with other challenges and opportunities. But, how to do this?

I’ve found that two conditions need to be met. The first is there must be sufficient pain as a result of culture related challenges to make it a priority. Pain can be pretty much anything that is interfering with the organization’s ability to achieve its goals. Difficulties executing strategy, integration challenges in a merger or acquisition, loss of top talent to competitors, capacity and scalability issues, declining financial results and loss of market share are just a few examples. The thing is most leaders don’t see these sort of challenges as having anything to do with culture, which leads to the second condition.  

Leaders must be open to considering that culture may be a factor contributing to the pain and/or getting in the way of effectively dealing with it. This isn’t necessarily easy as most leaders are sceptical when we talk about culture change as a solution to a business problem. This is, of course, entirely expected and reasonable given there are likely several factors contributing to the pain. These can be internal, such as outdated technology or inefficient work processes, and external, including the entry of new competitors, changing customer expectations and so on.

Trying to convince leaders that changing the culture will solve their problem is misguided and not going to work. What we want is for them to consider that while culture may not be the entire answer, it may well be a critical part of the solution. To this end, I never, ever talk about culture as the problem and culture change as the solution. Instead, the focus is on the business problem with capability development part of the solution. This is where using business language versus culture speak can make a difference. We start with engaging leaders in conversations about the business problem, not the culture, then expand the conversation to explore capabilities and the changes required to close the gaps that may exist.

Translate Their Role into Tangible Actions

What about convincing leaders to accept their role and lead the way? I’ve found the best approach is to not make this an up-front condition for embarking on culture change. Better yet, don’t talk about it at all until there is something tangible to discuss. Asking leaders to embrace a role that sounds vague, time intensive, uncomfortable and potentially threatening without this is setting ourselves up to fail.

By tangible, I mean the specific actions they need to take to close the capability gaps they identify. This includes behaviors, practices and creating the right set of conditions defined in very concrete terms. If for example, they identify the need for heightened agility, the required actions might include increasing delegation of authority limits, committing to a 24-hour response to requests for decisions, streamlining the approval process to a two-step process, and limiting Legal’s role in decision-making. These are very concrete actions leaders understand and know how to implement. This doesn’t mean they are easy, but they are manageable and achievable. If we accompany the actions with a plan that is realistic and has a high probability for personal and organizational success, we’re off to the races.

By speaking their language, using a business-driven approach and making their role tangible, we have significantly increased the probability that leaders will personally engage in culture change. The good news is this isn’t difficult for most Human Resources and Organization Development/Effectiveness professionals. We’re used to talking about business problems, gaps, solutions and action plans. You can’t be successful without this. All we need to do is apply the same language and approach to culture. The following case study, A Culture Conversation with Bob, provides an example of the first two strategies. Although the specifics vary depending on the situation and leader, the basic conversation framework absent probes and follow-up questions are the same. The topic of tangible actions is explored in a later chapter.

A Culture Conversation with Bob, CEO Transportation Company

The following dialogue is an abbreviated version of a recent conversation with the CEO of a major transportation company. To facilitate the conversation, I always bring a set of Culture Cards and Images with me and pull these out when it makes sense. These types of tools are effective in focusing the conversation on culture without using culture-specific language. The cards I use are from a model based on my research and are consistent with the work of other experts including Geert Hofstede, Roger House and Fons Von Trompenaars.

Question: What challenges are keeping you up at night?

Answer: We must successfully implement several new, large and complex initiatives while at the same time continuing to conduct business-as-usual and meet market expectations. This involves doing things we’ve never done before. I’m concerned that we won’t be able to deliver; that we’ll fail to deliver the expected financial results. If this happens, we will be under even more pressure and closer scrutiny than ever making it increasingly difficult to do what we need to do.

Question: What does success look like?

Answer: The bottom line is we hit our numbers and meet or exceed market expectations. This requires that we launch our new low-cost service on time and within budget; drastically reduce operating costs in our existing lines of business; and, complete a major technology upgrade without disrupting the business, on time and within budget. At the same time, we must maintain or improve our current level of service to our customers, retain our top talent and attract new employees with the skills we need for the future. I’m not optimistic. We’re already experiencing delays that are threatening both the launch of the new service and the systems upgrade.

Question: What could cause you to fail?

Answer: It’s too much. We’re stretched very thin given our current resources and capacity. People are already showing signs of burnout and I’m very worried we’re going to start losing not just our top talent but also the people we need to keep our core business running. Ideally, I would like to focus on streamlining work processes, getting rid of waste and increasing capacity before launching the new service offer and doing the technology upgrade. The problem is we can’t wait. We’re already being threatened by the imminent arrival of new competitors who are entering our market with a low-cost service. Our existing technology is old and can’t handle what we need it to do to be able to compete. Bottom-line is we must figure out how to make it all happen.

Question: What capabilities are needed to successfully meet these challenges and deliver the expected results? Capabilities are the abilities required to achieve your goals.

Answer: First, we need project management skills to make sure we plan and implement the changes effectively and efficiently. That’s why we’ve set up a Project Management Office to work with the business teams. Second, we must execute with excellence which requires discipline and doing things right the first time. We don’t have a good track record at this. We’re great at generating ideas but pathetic when it comes to execution and follow through.  Collaboration across groups is another area where we fall short. The challenges we’re facing aren’t isolated to one group or another. It is going to take all parts of the business working together to be successful. We can’t continue to fight over resources and have competing priorities. We must be aligned with our priorities. This means accepting that some groups are going to get more than others. This is simply the way it is. We only have so many resources and we need to use them where it matters most.  At the same time, we can’t lose sight of our people. We must show they are valued, and we care. Managers are going to have to spend time communicating and listening and do the big and little things required to keep their staff engaged. We cannot afford to lose talent due to stress and burnout. We also absolutely must stay focused on our customers and continue to deliver the exceptional experience we’re known for. This has been a key differentiator for us, and we can’t let it suffer, especially with all the changes happening and potential for uncertainty in how we are covered in the media. Finally, we absolutely must meet our numbers. Failure to achieve our financial targets would be disastrous. Funding for capital projects would be pulled back impacting our ability to move forward with the initiatives we must implement to keep pace with our competitors.

Question: What capabilities are existing strengths? Strengths are capabilities to protect and use to address the business challenge.

Answer: Our strengths are employee engagement, customer focus and doing what it takes to get results.

Employee Engagement. Our employees really care about our customers, the company and each other. They are passionate and take great pride in our successes. We need to protect this as it may be at risk given what I’m hearing about employee burnout.

Customer Focus. A big part of who we are is our commitment to providing every customer with a great experience. We genuinely care and treat each customer as a friend, family and neighbor. Our challenge is to find a balance between doing what is best for a single customer with what is best for all customers and the company. While this is a strength, it is also a challenge we are going to have to address.

Results Focus. Our employees step up and do whatever it takes to meet commitments, although this is becoming increasingly difficult. They must overcome significant obstacles such as broken processes, lousy technology and heavy workloads to make this happen. I’m seeing some cracks. We are still delivering on the big things, but people are taking shortcuts, which is causing issues with quality. Some of the lesser priorities are also being missed as employees make choices where they direct their time and energy. We have to be careful they focus on the right things, which means being very clear and consistent when setting priorities.

Culture Strategy Fit's Culture Cards Product

Culture Strategy Fit’s Culture Cards

Question: What capability gaps do we need to close? Capability gaps are the abilities required but lacking in the organization.

Answer: The main ones are those I already mentioned. Project management skills. Execution excellence.  Collaboration across groups. Managing our resources effectively. Aligning on our priorities. At the same time, we must manage employee burnout and continue to meet or exceed customer expectations while achieving our financial targets. All of these are important. We also have to do a better job communicating what’s happening and why it’s important to our employees.

Question: Select an image that best captures what you mean by [capability gap]. Culture Images are very useful in facilitating this discussion. I bring a set of 20 and asked Bob to pick one.

Note: The purpose of the image is to avoid the assumptions that often accompany words. For example, agility means different things to different people. To some, it means full autonomy to make decisions. To others, it is an approach borrowed from agile development in software engineering.

Answer: Bob selected an image of a chef’s kitchen in a high-end restaurant.  

Question: Why did you select this image?

High end kitchen with everyone knowing their responsibilities

Changing the Organizational Culture – Engage the Leader

Answer: A kitchen in a high-end restaurant runs like a well-oiled machine. Every person in that kitchen knows exactly what they need to do to make sure they deliver a meal that meets or exceeds their customers’ expectations. There are distinct roles with different responsibilities,but they work together seamlessly. They have the best of tools, such as equipment, food and so on, available to them. They are efficient and effective and do not waste resources. Everyone knows what they need to do, pay attention to detail, communicate and meet their commitments. They trust each other implicitly. They have exceptionally high standards and execute flawlessly. They deliver.

We need to be like this. We need to work together and execute seamlessly, work together, communicate and get results with the customer front and center at all times.

Question: What changes are needed to make this happen?

Note: Time permitting, this is an opportunity to get leaders starting to think about possible solutions.

Answer: The most pressing priority is to create capacity for the major initiatives we have planned. We need to stop doing things that aren’t adding value, streamline decision-making, get rid of out-dated policies and processes and anything else that is not essential. It also means saying no to new opportunities, no matter how tempting they are…we aren’t good at this. We like to chase after shiny new things. We also have to put a stop to some of the things we would like to do but simply can’t because of resources. This means discontinuing work on several important initiatives currently underway. People aren’t going to like this.

In other words, we can’t be a well-oiled machine without making some fundamental changes. We have to strengthen our foundation by getting back to basics. And, we must do it together as a team. Every leader and employee must get on board and do what is needed for us to be successful. We can’t continue to operate in fiefdoms protecting turf and resources.

End of conversation.

In Summary

The conversation with Bob is an example of a culture conversation that isn’t about culture. It is about the business. The challenges keeping him up at night. The obstacles getting in the way. The capabilities required. The changes needed. This might seem disingenuous and, to a point, it is. It is also effective. By speaking his language and focusing on the business, we are operating in his world of hard facts and concrete actions. This is something every leader can relate to. After all, problem-solving is what they are good at.

In fact, it is something every person working in or with an organization learns if they are to be successful. This means you are probably already doing this. If you are in Human Resources, you deal with business problems and solutions all the time. The difference is you can use words like talent acquisition and leaders know what you mean. You don’t have to translate this for them. If you’re having trouble attracting the right people, leaders understand the implications. The difference with culture is we have to make it understandable. We have to translate a ‘soft’ and vague concept into something concrete and relatable. Only by speaking their language, using a business-driven approach and defining tangible actions do we have a realistic chance of engaging leaders in a meaningful way in culture change.

In sum, leader engagement in culture change is absolutely essential but very difficult to achieve. There are so many obstacles getting in the way. To overcome them requires a new way of thinking, talking and approaching culture and culture change. It requires a paradigm shift.

Dr. Nancie Evans

Dr. Nancie Evans is co-founder and VP Client Solutions at Culture-Strategy Fit Inc. specializing in the alignment of organizational culture and strategy. She has developed a unique set of leading-edge diagnostic tools and approaches that provide leaders with deep insights into the culture of their organizations, how it is supporting or getting in the way of strategy execution, as well as the levers that they can use to drive rapid culture change.

Culture-Strategy Fit®

Culture-Strategy Fit Inc. is a leading culture and executive leadership consulting firm conducting groundbreaking work in leveraging culture to drive strategy and performance. It’s suite of culture surveys and culture alignment tools are used by market-leading organizations around the world.

Contact Us

www.culturestrategyfit.com

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Culture Change: Senior Leaders Must Lead The Way

Culture Change - Senior Leaders Must Lead The Way

Culture Change: 30 Years of Lessons Learned

It’s been a long time coming, 11 years and multiple drafts, but I’m excited to announce that my book is finally looking like it is going to be completed. Yay! In my book, I share the many things I’ve learned over 30+ years of searching for the answer to one question: How do we achieve meaningful and sustained culture change in organizations?

This is one of the chapters from the book. I am offering it in the hope it provides some useful insights but also to ask for your feedback. I would sincerely appreciate any thoughts or suggestions you would care to share. Thank you in advance! Onwards….

Lesson 1: Senior Leaders Must Lead The Way

Who is accountable for an organization’s culture?  The answer is leaders. By ‘leaders’, I mean anyone at any level who others look to for guidance, especially people who hold senior positions in an organization. The reason is simple — leaders are the single most important factor in determining the success of any culture change effort.

If you rolled your eyes and said ‘duh…everyone knows that’, you’re not alone. After all, if senior leaders are committed to the change effort, they will make it a priority and allocate the resources, required to be successful. Right? The answer is ‘yes and…’

Absolutely, leaders must commit time, people and money if the change effort has any chance of being successful. The thing is they need to go further which means owning it. They must be fully committed to the change and personally involved in a meaningful way in all phases of the change effort. Sure, they are going to need help, but they are going to have to lead the way which means showing — not just telling — others what is expected, making tough decisions and creating the conditions for success. It can’t be a, nice to do, nor can it be delegated to Human Resources or others.

Isn’t Culture a Human Resources Thing?

In almost every organization I’ve worked with, Human Resources are responsible for culture. Leaders might say they own it, but the reality is they typically articulate values and, in some cases, identify the culture the organization needs, communicate this to employees and then hand off the heavy lifting to Human Resources to make the change happen. Unfortunately, this doesn’t work.

Don’t get me wrong. Human Resources plays a critical role in culture change. They own a lot of the processes that encourage and reinforce expected behavior, such as hiring practices, performance management systems, advancement criteria and so on. Leadership and organization development professionals can also provide leaders with expert guidance and support in areas such as behavior change, coaching and feedback and change management.  In other words, Human Resources can and should be strategic partners helping leaders with the change effort, but they cannot do it for them.

Why not? Three reasons —- behaviors, practices and environment.

Leaders’ Actions Send Messages to Others

Through their words and, more importantly, their actions, leaders send messages about the expected way of doing things. When words and actions are consistent — they walk the talk — the message is clear and pretty much guaranteed to influence others to behave in a similar manner.

Image of a department head leader offering assistance to one of the team members.

The thing is employees notice absolutely everything that a leader says and does. If a leader consistently arrives early for a meeting, his or her direct reports will do the same or risk being perceived as unpunctual and disrespectful of others’ time. If he or she always wear the appropriate safety gear on a work site, people know this is important and they can expect to be censured if they don’t do the same. Of course, the opposite is also true. A leader that is frequently late for meetings and appointments sends the message that it is okay not to be punctual. Likewise, a leader who blames others for his or her mistakes is telling people through his actions that avoidance of responsibility is okay.

What if there is a disconnect between what a leader says and does? The answer…people will default to actions as the real message. If a leader says candor is important and she wants employees to openly voice their concerns and then reacts negatively to their comments, guess what the message is? Candor means telling her what she wants to hear. A few situations like this and people will have figured out the rules — how to make her believe they are being candid while protecting themselves from harm. The leader is happy thinking employees are speaking candidly when the reality is far different. To make matters worse, the credibility of the leader has been damaged. People now know not to believe what she says but rather to look to her actions for direction.

The bottom-line is a leader’s words and actions must be consistent and role model what is expected — no exceptions and no excuses! No amount of effort by Human Resources can replace this.

Leaders Reinforce Culture in Day-To-Day Practices

Practices are the repeat patterns of activity or routines that people use as they go about their work. They are different from processes which involve the transformation of an input into an output. Practices cover a wide range of routines including the way decisions are made, information is shared, and people are recognized, just to name a few. They are the building blocks that help to determine “the way that things are done around here”.

While every employee use practices to some extent, leaders employ more of them more extensively which gives them greater influence over culture. This includes the approach they take to developing plans, conducting meetings, managing performance, developing employees, and so on and so forth. To illustrate the effect practices have on culture, contrast meetings that are managed in a structured and disciplined manner with ones that are loosely organized.

Leader asking questions to one of the team members

A disciplined approach to meetings typically includes a carefully designed agenda that is sent out well in advance. Materials such as briefing notes and reports are distributed prior to the meeting with clear instructions regarding expected action, such as read prior to the session and come prepared with questions. In some cases, there is even a clear ask such as, this item requires a decision while another seeks advice or feedback. The meeting itself starts on time and the agenda is tightly managed. The rules of engagement are clear and closely monitored. Minutes are taken with decisions and actions noted and distributed to the attendees. This approach is usually preferred by leaders who value efficiency and discipline. They assess the effectiveness of a meeting by the decisions made, issues resolved, and actions identified. Relationship building is, in most cases, viewed as secondary to achieving these objectives.

Loosely organized meetings are very different. These are usually preferred by leaders who believe the primary purpose is to share information, exchange ideas and build relationships. For these leaders, making decisions, resolving issues and developing action plans happens in other ways. It is therefore not surprising that their meetings often lack structure and discipline. If there is an agenda, it may or may not be followed. It might even be sent out in advance and include some pre-meeting materials but there is an implicit understanding that this is a guideline rather than a commitment. Often, a good portion of the agenda is never reached, and this is okay. Similarly, there may or may not be minutes depending on what happens in the meeting and if any decisions are made or actions identified.

This is just one example. If the same beliefs are reflected in other practices, there is a compounding and reinforcing effect. For instance, a leader who believes relationships are critical might take a consultative and inclusive approach to decision-making and problem-solving. Similarly, a leader who believes discipline and efficiency are the keys to success is going to apply this in other practices such as, setting clear objectives and systematically monitoring and measuring performance. The more different practices are consistent, the more impact they have on culture. This is what I call using a network of practices, which is discussed in more detail in a later chapter.

The practices used by leaders not only reflect their beliefs but are an indicator of their expectations of others. If a leader believes discipline is important, he is going to assess others performance and abilities using this as a criterion. Anyone who demonstrates a lack of discipline, as perceived by the leader, is taking the risk of being judged negatively. In fact, practices may be even more influential than behavior as they directly affect the way people work and interact and how they are perceived by others. Once again, this is not something Human Resources can do for leaders.

Leaders Create the Conditions for Success (Environment)

Leaders also determine the design of structures, systems and processes. They decide how space is used, what artefacts are on display (or allowed) and what traditions and rituals are practiced.  By the choices they make, leaders create the conditions that encourage and reinforce expected behaviors and practices.

My favorite way to explain this is to use a metaphor of someone trying to lose weight. It is easy to identify the behaviors to start and stop, such as eating more fruits and vegetables, cutting out foods with high levels of sodium and sugar, and exercising more. It’s also easy to identify practices to reinforce these behaviors such as using an app to track food consumption and exercise, weighing in on a weekly basis and attending regular meetings with other people who have similar goals. If I do these things, chances are pretty good I am going to lose weight at least in the short term. The challenge, as many of us know, is overcoming temptation especially when you’re stressed or tired. This is where the environment plays an important role by creating the conditions for success.

If the kitchen cupboards are stocked with salty snacks, cookies and chocolate, eventually the temptation is going to be too great to resist. Similarly, if other family members are munching away on high-calorie foods and drinks that you love, I can pretty much guarantee everyone of us is going to cave. Likewise, if you hate going to the gym and this is your main source of exercise, there is no way you will be able to sustain the motivation to keep going. This is what I mean by the environment needing to support the desired behaviors in order to create the conditions for success.

Supervisor leader overseeing work performed by team members.

We see this same pattern repeated over and over in organizations. A tremendous amount of effort and resources is invested in articulating and communicating the case for change, values and expected behaviors. Expected behaviors are then embedded in various Human Resource processes such as talent acquisition and so on. There may even be a commitment to coach and hold leaders accountable for modeling these behaviors. Yet, time and time again these efforts fail to result in meaningful, sustained culture change. Why not?

When we ask people to change their behavior but don’t align the system to support these behaviors, we are setting them up to fail. Human Resource policies, programs and processes are a critical part of this system. Aligning these to support the desired change is essential and fortunately usually happens, at least to some extent. The problem is other important parts of the system, many owned by other functions and groups, often get ignored.

Take Legal, for example. In large mature organizations, the Legal group is often a gatekeeper reviewing and approving contracts or arrangements. It is not unusual, to hear stories of long delays and the need for multiple levels of approval to get something done. This happens for very good reasons, such as the need to protect the organization’s best interests, meet its regulatory and legislated obligations, manage costs and get the best possible deal with suppliers. It does, however, contribute to slow decision-making and missed opportunities.

Let’s say things change. New competitors, emerging technology and changing market and customer expectations require increased speed and responsiveness to compete. In other words, the organization needs to be more agile which means decisions need to be made swiftly often with limited data meaning risks are going to be taken and mistakes made. This is a significant culture change for an organization that has been successful operating in a slow, cautious and methodical manner. The thing is, for the organization to become agile, the role of Legal and many of its core processes and policies need to change. They must align with and support agile behaviors and practices. This is threatening not only to Legal as a function but to its individual members. It also challenges existing beliefs as to the best and right way of doing which motivates people, often with good intentions, to resist the change.

Clear communication of the case for change accompanied by the effective implementation of change management practices can help to overcome resistance, at least to some extent. However, for the change to be successful and accomplished in a reasonable time, senior leaders must be actively involved in identifying and implementing the required changes to structures, processes, policies and so on. To be clear, they are not doing this alone. They need to engage subject matter experts and others whose expertise is critical to arriving at the best possible solution. The leader’s role is to challenge, push and test to ensure changes deliver the expected results. Ultimately, leaders must create the right environment so new behaviors can take root and flourish. They must be willing to make tough, unpopular decisions and hold people accountable in order to create the conditions for successful culture change.

The good news is culture change can be achieved in a matter of months, not years, when senior leaders effectively use a combination of behaviors and practices and create the conditions for success. To illustrate, let’s look at the story of Bill G., CFO of a large U.S. telecommunications company.

Bill’s Story

Bill had recently been hired to replace the outgoing CFO who was retiring. He brought to the role 25 years of experience and a proven track record leading several finance organizations in the telecommunications industry. The company he joined was a relatively young organization but growing quickly as it capitalized on new and emerging technology. It was known to be innovative and entrepreneurial with tremendous growth potential.

It wasn’t long before Bill realized that this entrepreneurial spirit included what he described as ‘an allergic reaction to anything resembling discipline, structure or process’. Employees, led by senior leaders, saw these as bureaucratic impeding their ability to be flexible, responsive and take risks; qualities that had played a major part in their success to date. As a result, past efforts made by the Finance team to introduce more discipline in areas such as budgeting, reporting and analysis never got off the ground.  Bill experienced this first hand at one of the early meetings he attended with the rest of the executive team.

The executive team was meeting to decide on the coming year’s advertising plan and budget. Several options were on the table for consideration requiring a sizable financial investment. The discussion was animated as executives shared their opinions as to the best way to proceed. This went on for a while with a lot of back and forth as people discussed the merits of the different options. When Bill suggested they consider the results from past advertising campaigns, there was silence. It turns out, there was no data available. Marketing didn’t have any performance metrics and wasn’t tracking results. Executives were making decisions involving millions of expense dollars based on intuition and personal preferences.

The more questions he asked and investigating he did, the more he realized this was the way things were done. Discipline was simply not part of the culture. He saw examples everywhere he looked from day-to-day practices such as meetings and appointments to decisions involving millions of dollars. While the entrepreneurial spirit was great, the lack of discipline was costing the company large sums of money due to rework, redundancies, poor decisions and so on and so forth. This was also contributing to productivity and performance issues, as well as taking people away from doing higher value work. The challenge, as he saw it, was to introduce more discipline without crushing innovation and agility.

The Solution Part 1 – Behaviors and Practices

Recognizing the difficulties in attempting to tackle the issue at the enterprise level, he decided to focus on things within his immediate control and sphere of influence. He started by introducing practices designed to bring more discipline into the way the Finance team worked starting with meetings and appointments. Bill reinforced these practices with his own behavior. For example, he made it clear that people were expected to be on time and prepared when attending meetings, no exceptions and no excuses. To this end, he introduced the following practices and behaviors:

Appointments and One-on-One Meetings

Practices

  • To schedule an appointment with Bill, people had to explain why the meeting was required and the expected outcome. If his input or a decision was required, relevant background information was to be provided so he could review it prior to the meeting.
  • Appointment times were strictly adhered to. If someone was more than 5 minutes late, the appointment was automatically cancelled, and the person was forced to reschedule another date. This was a big deal as it was extremely difficult getting time with him. It could be weeks before the next opening in his schedule. People quickly learned to be on time.
  • Bill’s schedule included time for travel to meetings, unexpected requests, preparation and other events. While there were times when emergencies required a change to his schedule, these were the exception and time was blocked to allow for canceled appointments to be rescheduled at an early date.

Behaviors

  • Bill was always on time for appointments and he expected the same of others.He read everything provided in advance. If the work provided wasn’t up to his standards, he would send it back and, in some cases, canceled the appointment. Initially, he provided clear written feedback as to what was missing and questions that needed to be answered. This happened once. After that, the person was expected to figure out what was missing and fix it.
  • At the end of one-on-one meetings, he provided feedback including what was done well and needed to be improved for the next time. For example, he expected people to provide a recommendation with their rationale when asking him for input or a decision. His feedback included coaching to help the person improve the quality of their recommendations.

Meetings

Practices

  • Meetings started and ended exactly at the scheduled time. If the meeting was to start at 9:00 a.m., he locked the door and started the meeting. People were not allowed to enter the meeting after it started. This included his boss and other senior people. It caused quite a stir at the beginning!
  • Bill introduced a set of practices aimed at improving the efficiency and effectiveness of meetings. These included publishing the meeting agenda with background information to be reviewed one week ahead of the meeting date. The agenda included the ‘ask’ for each item, such as provide input, identify issues or obstacles, make a decision or provide information.  Items that fell into the ‘provide information’ category were reviewed to determine if these could be effectively addressed in other ways and removed from the agenda. The amount of time allowed for each agenda item was determined by the complexity of the topic and the “ask”. In the meeting, these timelines were strictly adhered to albeit with some growing pains at the outset. Initially, agenda items were closed without having achieved the “ask”. As the team got better at using the available time, this became the exception rather than the rule.
  • He also implemented meeting principles that clearly defined expectations for behavior. These included being present and engaged which meant turning off cell phones and other non-essential devices. To address potential emergencies, he provided a person outside the meeting to contact. These principles were posted on the meeting room wall and used as a form of performance review at the end of each meeting. Specifically, the team quickly did a ‘green, yellow, red’ scorecard of each principle to indicate what they did well and needed to do better. A brief discussion of the ‘do better’ principles clarified expected changes for the next meeting.

Behaviors

  • Bill always arrived at least 5 minutes early for every meeting. If it was someone else’s meeting, he would wait 10 minutes and if the meeting hadn’t started, he would leave. Initially, this was a problem with his boss and his peers, however, he was able to manage the issue by getting their buy-in and agreeing to return to meetings if required. He made his point swiftly and effectively.
  • In the first meeting he hosted, one person made the mistake of not taking him seriously and answered a call. Bill stopped the discussion, walked up to the person and held out his hand for the phone. He told the person at the other end to call back when the meeting was over and turned off the phone. He then took the phone and dropped it in the garbage can. Everyone laughed, and the discussion continued. At the break, the phone’s owner approached Bill and apologized asking if he could have his phone back. Bill said no. The rules were clear and there needed to be consequences. If he wanted a phone, he was going to have to get a new one. The story traveled through the building like wildfire.

Within days, people began to show up on time for their appointments with Bill. Within a few weeks, people consistently arrived on time for meetings and not just his meetings but also meetings hosted by his boss and others in the organization. Meetings became more efficient and effective and people appreciated that they could depend on the fact that meetings would always end on time.

This discipline wasn’t restricted to appointments and meetings. He applied the same principles to performance management, written communications, business case preparation, presentations and an assortment of other practices. He used every opportunity to bring greater discipline into day-to-day work and interactions.

Four months after Bill joined the company, employees described a significant, observable culture shift towards increased discipline resulting from the behaviors and practices he role modeled. Although initially limited to the Corporate Finance team, they were already seeing evidence of change elsewhere as other leaders and teams followed his lead.

The Solution Part 2 – Creating the Conditions for Sustained Success

Leader and team members celebrating a victory with 'high fives'.

In the words of one employee, Bill’s primary goal was to increase the discipline applied to cost management and decision-making by implementing initiatives that would encourage “deeper economic and operational analysis from both a tool and process perspective”. The behaviors and practices he introduced were only the beginning. Bill recognized that addressing the big issues at the enterprise level required a substantial investment in core processes and technology, as well as changes to the way Finance was structured. These changes required careful planning and project management with implementation happening over a period of 24 months.

An Interim Solution – Paving the Way for Change

Prior to Bill taking over as CFO, the vast majority of Finance professionals were generalists who reported directly to business unit leaders. Their responsibilities were broad and included budgeting, cost and sales estimates, expense management, reporting and anything else the business unit leader needed. A few specialists reported directly to the CFO handling Corporate level fiduciary requirements, such as Treasury, Investor Relations, Financial Planning and Analysis (FP&A), and Controller/Accounting.

The Finance generalists concentrated their efforts on meeting the needs of the business unit leaders. As a result, every business did things differently. They had their own way of estimating sales and revenue, budgeting, reporting, managing costs, analyzing results and so on. When it came time to pull together financial information at the enterprise level, the Corporate team had a mess on their hands, if they could get the information they needed from the business at all. This led to long delays and inaccurate and incomplete financial information that no one trusted.

Many of the processes required to solve this problem were already in place. The issue was they were not being followed. One option was to mandate that the businesses comply with the Corporate processes, however, this would put the Finance generalists in the difficult position of having to push back on leaders and not deliver what they wanted. This wasn’t realistic given business leaders set the Finance generalists’ objectives, assessed their performance, determined rewards including merit increases, and had a significant say in advancement and development opportunities. Asking the generalists to put Corporate needs ahead of the business and go against the wishes of the business leader was setting them up to fail.

In the short-term, Bill decided to do things that didn’t totally resolve the situation but certainly improved it. The first was to insist on a greater role in setting expectations and evaluating the performance of the Finance generalists. By making this a shared responsibility, he was able to align their objectives with his priorities while at the same time providing an incentive to consider Corporate Finance requirements when they set priorities. Second, he sought agreement from business leaders to comply with the processes most critical to addressing the issues with the timeliness and accuracy of financial information. Given the severity and visibility of the problem, it was relatively easy to get the support he needed. With this in place, he quickly deployed resources to ensure expectations were clear, and the processes and tools understood.  

Phase Two – Process Changes

With the immediate problem addressed, Bill directed his attention at making the changes required to achieve his goal of increasing the discipline applied to cost management and decision-making. To this end, he identified and set about implementing a set of initiatives targeted at improving the timeliness, quality and quantity of financial information available to business managers when making decisions. This included launching a major Activity Based Costing (ABC) initiative, adding rigor to the approval process for new hires and capital funding, and spearheading a new business priority and objective setting process. He also partnered with the CIO to lead the implementation of a decision-support system (data and analytics). These initiatives were prioritized and carefully planned so as not to disrupt business-as-usual while ensuring progress was made as quickly as possible.

Recognizing this was not a strength in Finance, or elsewhere, Bill established and staffed a new Project Management Office (PMO). The PMO was responsible for helping the various project teams effectively plan, implement, monitor and report on their progress. Although not entirely successful, due to new hires who clashed with the existing culture, it resulted in a level of consistency and transparency that had been absent from past initiatives.

Phase Three – Structural Changes

Approximately six months after the business leaders agreed to follow the prioritized Finance processes, there continued to be major issues with the timeliness and accuracy of financial information. Despite their assurances, the business leaders had quickly reverted to their old ways of doing things insisting that the Finance generalists make their needs a priority. While most of the generalists did their best to deliver the information required by Corporate, workload pressures and competing demands meant delays and inaccurate and incomplete information was the norm.

The situation came to a head when the company was called to task by outside analysts for overestimating projected revenue and failing to notify the market that expectations were going to be missed. Although painful, this was the opening Bill needed to restructure the Finance function. He immediately moved to change reporting relationships so the generalists reported directly to him and indirectly to the business leaders.

Making this happen was not easy. The business unit leaders fought hard to maintain the status quo. They argued that the current structure allowed them to focus their Finance staff on business priorities, such as pricing, competitive bids and so on. They feared that a centralized structure meant they would lose control of these resources which would cause delays in getting the Financial support required to effectively manage their P&L. In the end, the financial forecasting and reporting issues outweighed their concerns and the CEO supported Bill’s restructuring plan.

Almost overnight, things started to improve. The Finance generalists still had a difficult task as saying no to business leaders is never easy. Knowing their boss, Bill, supported them and would step in to help when needed went a long way to giving them the confidence and courage they needed. Indeed, in the early days, there were several stories of Bill confronting business leaders and C-suite executives who tested the new way of doing things. This only had to happen a few times for the situation to improve but the message was clear. This was the new world order…take it or leave it.

Of course, sustainability ultimately depended on Finance’s ability to deliver timely, accurate financial information that addressed the company’s fiduciary obligations and a need for greater discipline in cost management and decision-making. If the problems persisted after the change, things would have quickly reverted back to the old way of doing things. Fortunately, the changes resulted in an immediate improvement to the quality and accuracy of financial information and only got better as the more complex, longer-term initiatives were implemented.

Two years after he was hired, Bill had achieved his goal of increasing discipline in cost management and decision-making. He also changed the culture. By changing core processes and structures, he created the conditions to encourage and sustain higher levels of discipline not just in Finance but across the company. However, as the business unit leaders had feared, there was also a decrease in the flexibility and responsiveness that was such a valued part of the company’s entrepreneurial culture. This contributed to a level of resentment and disapproval of the changes Bill had introduced, although most leaders acknowledged that it was the right thing to do. This rebalancing or calibration of culture attributes is part of the challenge of changing culture, and a topic for a later chapter.

In Summary

Bill’s story is an example of leader-led culture change. He concentrated his efforts on changes within the scope of his role and decision-making authority and used the tools at his immediate disposal to move things forward. This was not a ground-up effort to engage employees to get their buy-in and support. You may also have noticed that Bill’s story doesn’t make mention of defining expected behaviors, communicating these to employees and embedding them in Human Resource processes and practices. Nope…this was an influential leader leading the way through his actions. This is not to say there isn’t value in engaging employees or partnering with Human Resources, which can be powerful ways to accelerate change. It just isn’t the approach Bill used which, contrary to popular opinion, was very effective.

Image of Simple Instructions for Leaders who wish to lead organizational change in their company.

The thing is achieving meaningful and sustained culture change requires that leaders lead the way. They do this by role modelling values and behaviors, using day-to-day practices, and creating the conditions for success. When this is done effectively, culture change is pretty much guaranteed.

Even more exciting is the fact that this is something any leader at any level can do. You don’t have to be in a senior management position. Anyone in a leadership role can use their words and actions in an intentional and purposeful way to shape and change culture. You may not have the power to change enterprise level structures and processes, but you can change the culture in your team and, perhaps in so doing, influence the culture of the organization. Furthermore, when a critical mass of leaders purposefully and authentically uses a similar set of behaviors and practices, the potential for positive change increases dramatically. When the organization system is aligned to support the change, well…the sky is the limit.

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Dr. Nancie Evans

Dr. Nancie Evans is co-founder and VP Client Solutions at Culture-Strategy Fit Inc. specializing in the alignment of organizational culture and strategy. She has developed a unique set of leading-edge diagnostic tools and approaches that provide leaders with deep insights into the culture of their organizations, how it is supporting or getting in the way of strategy execution, as well as the levers that they can use to drive rapid culture change.

Culture-Strategy Fit®

Culture-Strategy Fit Inc. is a leading culture and executive leadership consulting firm conducting groundbreaking work in leveraging culture to drive strategy and performance. It’s suite of culture surveys and culture alignment tools are used by market-leading organizations around the world.

Contact Us

www.culturestrategyfit.com

1.800.976.1660
nancie@culturestrategyfit.com

Culture Change: What and Why

Healthy Company culture supported by audience of employees applauding

Culture is something that permeates and affects every aspect of a company. It is more than values, more than people, more than their behavior and more than their relationships. A company’s culture is about its underlying beliefs and assumptions that guide action and that are learned and shared by members of groups as they strive to achieve the organization’s goals and fulfill its purpose.

Culture Change: Getting Off To The Right Start

In order to change or improve upon your company’s culture, you must first understand it, and the only way to understand it is to ask the right questions. If you simply ask employees to describe the culture or tell you how “things get done around here,” you’re probably going to get blank stares. This is where the who, why and what culture conversation can help.

culture conversationQuestion #1 – Who?

Who should participate in the conversation? The answer is simply anyone and everyone – the more the better. Of course, this may not be possible for practical reasons. The important thing is diversity. You want to engage people at different levels, genders, tenure, professions, locations and so on. Ideally, those involved are credible influencers, the people others look to for guidance, as they can spread understanding and help shift the culture if needed. If you can add the perspective of people outside the organization, even better. Outsiders often notice things that insiders are oblivious to. This might include customers, suppliers, analysts or even competitors.

Question #2 – Why?

The conversation starts with generating a whole pile of ‘Why’ questions that begin with ‘Why do we do X this way?’ where X is replaced with descriptions drawn from people’s experience. For example, why do Maple Leaf players stay at a hotel when they are in Toronto for a playoff game? Why do the Leaf’s suspend players who are late for a practice? Why do they have a Father and Son weekend? Generate as many questions as possible and don’t worry about filtering or critiquing them. This comes later. You’re looking for a comprehensive description of the way things get done around here.

Every ‘why’ question has the potential to be meaningful but I like to start with the questions that people want to talk about; where they have the most energy. These are often the ones that are the most revealing. Once you’ve worked through these, you can decide how to handle the others. A word of caution, in an effort to go quickly, people are prone to say that a question is like one that has already been discussed so it can be skipped. A quick test is to go around the room and ask people to say or write down their answers. If something different emerges or views differ, it should be discussed.

As each question is answered, write down the beliefs and assumptions that emerge keeping in mind that people may see things differently. For example, one person might see the Leaf’s Father and Son weekend as nothing more than a perk of the job while someone else believes it symbolizes the importance of family. But, what is ‘family’ and why is it important? You might get to something like we believe a solid support system (including the family at home) is essential for professional hockey players to successfully navigate the good and bad times that all players experience. One way of thinking about this conversation is to recall an interaction with an inquisitive two-year old. Why are you doing that? Buy why? But why? Eventually, you will have developed a core set of beliefs and assumptions. You will know you’re there when every new question results in the same answers or challenges a defined belief.

Question #3 – What?

Chances are good, you will also have a list of ‘why questions’ that don’t fit with the belief system. For example, why aren’t mothers included in the Father and Son weekend? Aren’t they part of the player’s support system? Does this mean mothers aren’t as important as fathers? This leads to the ‘What’ question which is “What does this say about our beliefs?” This conversation is about questioning current behaviors, practices, and ways of doing things to identify inconsistencies that send mixed messages and serve to undermine the culture. It can, however, also raise questions about the core beliefs and assumptions.

What is to say that the outliers aren’t actually better or more appropriate for the organization? This introduces a new line of questioning. It starts with a macro question such as what is our vision, mission and/or purpose? What is our strategy? What do our customers expect/need? Given this, do our existing beliefs and assumptions make sense or do they need to change?

The bottom line is that what worked in the past may not be what is needed to be successful today and in the future. To use an example from the corporate world, an organization may have been successfully operating with the belief that the best way to mitigate risk is through a system of controls that includes restrictive delegation of authority and hierarchical decision-making. But what if the world around them starts to change and they need to be able to make decisions and change directions quickly to remain competitive? The existing belief system now acts as a barrier. Unless this is changed, and with it, related behaviors, practices, and structures, the culture will get in the way of any effort to be agile.

The Importance Of The Why and What of Culture Change

People learn and remember things by being explicit about them. If an employee is doing something in a certain way, say a way that is not ideal for the organization, they may simply be doing it that way because they never thought about it. But when you draw information from people via what and why style culture conversations, you naturally get them to consider their behaviors in a more critical way than they would have otherwise. Moreover, when you come across cultural problems in these conversations people feel they are in part responsible for identifying them, and when people feel they helped to identify a problem, they are more likely to help you fix it. What and why conversations are a powerful and effective technique to help people understand their company’s culture in a meaningful way. Meaningful, especially, in that they can reveal the beliefs, assumptions, and values that are deeply embedded in the collective psyche of an organization.

If You Need Help With Culture Change, We’re Here to Help

Changing corporate culture can seem like a daunting task but it doesn’t have to be. Culture has a high capacity to help businesses achieve genuinely great things. If you need help defining or changing your business’s culture, check out some of Culture-Strategy Fit’s excellent cultural products and services, or give us a call today at (800) 976-1660 for a free consultation.

Dr. Nancie Evans

Dr. Nancie Evans is co-founder and VP Client Solutions at Culture-Strategy Fit Inc. specializing in the alignment of organizational culture and strategy. She has developed a unique set of leading-edge diagnostic tools and approaches that provide leaders with deep insights into the culture of their organizations, how it is supporting or getting in the way of strategy execution, as well as the levers that they can use to drive rapid culture change.

Culture-Strategy Fit®

Culture-Strategy Fit Inc. is a leading culture and executive leadership consulting firm conducting groundbreaking work in leveraging culture to drive strategy and performance. It’s suite of culture surveys and culture alignment tools are used by market-leading organizations around the world.

Contact Us

www.culturestrategyfit.com

1.800.976.1660
nancie@culturestrategyfit.com

How To Use A Network Of Practices To Shape And Change Culture

corporate culture

Creating a culture by design is not easy, however, it is possible with the potential to achieve concrete results in a matter of months and not years as popularly believed. We’ve seen numerous examples in all sizes of companies across a wide range of industries and sectors that support this statement. In some cases, the change is dramatic and others less so but in everyone, leaders were the catalyst for the change that occurred. How did they do it? Here’s our guide to how to use a network of practices to shape and change culture.

How Are You Trying To Change Your Company’s Culture?

The first thing to understand is that in order to shift your company’s culture you have to identify some specific characteristics that you want to change. It is not enough to simply say “I want to improve my company’s culture.” You must know what exactly you want to change/improve and implement a related set of behaviors, practices and action strategies. Don’t worry about getting it perfect. Just focus on a few things and do them consistently, preferably with others. Let’s look at an example.

Challenging the Status Quo

In many organizations, days, weeks, months and even years go by with people doing the same thing the same way. In some cases, this is because of the current way of doing things works. It is the most effective and efficient approach currently known and available. The problem is that things change. The external environment is constantly in a state of flux challenging organizations to keep pace or fall behind. The emergence of new technologies, improved methods, and processes, new knowledge, competitors and innovations happen all the time.  To thrive in this environment, organizations must be alert to what is happening in the world around them while at the same time questioning and challenging existing assumptions and searching for new and better ways of doing things.

Behaviors

Walk around and observe the work that is being done in your area or organization.

  • Ask yourself, ‘why are we doing things this way?’
  • If you can’t answer the question or are unhappy with your answer, ask the people performing the work the same question then ask, is there a better way of doing this? or what is stopping us from doing this another way?

Ask ‘what if’

  • This is a powerful phrase as it often involves questioning another person’s actions but in a way that invites dialogue and encourages them to consider alternative approaches and scenarios.
  • Look for situations where actions are being taken or decisions made because this is the way things have always been done.

Operating Practices

Use problem-solving situations to ask ‘what if’.

  • Encourage others to also ask ‘what if’ by avoiding getting to a solution too quickly.
  • Use a rapid brainstorming technique to surface as many ideas as possible as quickly as possible.
  • Make it a rule that there is no critiquing of ideas until all possibilities are on the table.
  • Consider inviting people who are outside or removed from the situation or problem to participate. They can sometimes be a source of ideas that people close to the situation can’t see.

Use problems, ideas and feedback from customers to identify and act on improvement opportunities.

  • Create an on-line ‘suggestion box’ using a template that allows type classification and sorting.
  • The suggestion box can be organized by an initial set of categories based on known problems and/or core business processes and work activities.
  • It is important to allow more categories to be created as new issues and opportunities are encountered.
  • Make sure to include at least one field to capture suggestions, recommendations, and ideas.
  • Ask people to log the problems they encounter, suggestions for improvement, feedback from their customers, missed deadlines and deliverables, and so on.
  • This can be anything that they want. Do NOT restrict the information that they enter.
  • Set up a schedule to review each category, analyze the contents and develop action plans.
  • Consider creating teams that have ownership for different categories and/or issues and opportunities.

Search Practices

Schedule a half day every month where employees can try out new approaches or experiment with new ways of doing things

  • Structure these around key responsibility areas or core processes.
  • People should be involved in things that they have an interest or stake in.
  • Provide an approach to help them get started (see Fostering Creativity for suggestions) and consider using a facilitator until they learn how to do this effectively.
  • This is an opportunity for people to try out things they’ve thought of in the past but has never been implemented or to take the time to think about and try ‘what ifs’. For example, “what if we stopped doing this?” or “what if we tried doing this differently?”

Use an approach such as Google’s grouplets: The Google Way: Give Engineers Room – New York Times to encourage people to voluntarily work on things that interest them.

  • Google provides its engineers with 20% of their time to work on things that interest them.
  • They can do this on their own or, as happens a lot of the time, in teams called ‘grouplets’.
  • The grouplets have no budget or decision-making authority. They have people who are committed to an idea and willing to work to convince others to adopt it.
  • There isn’t a formal approval process or directives from senior management. The burden is on the grouplet members to convince others.
  • To minimize the risk of misalignment and duplicated effort, grouplet organizers meet once a  week to review what is happening.

Action Strategies

Hold a scenario planning workshop.

  • Scenario planning involves extrapolating a number of possible futures based on known factors and plausible trends. This encourages people to ‘think the unthinkable’.
  • After the future scenarios are identified, people work together to answer questions such as, “what do we need to do now to be ready for all possible scenarios?” This leads to the development of action plans that, when effective, address the majority of scenarios the organization may face.
  • Information on how to conduct scenario planning is available at the following link: http://www.jiscinfonet.ac.uk/tools/scenario-planning.

Ask your team to read and discuss what can be learned from the Superstruct Game that was conducted in 2008 and played by over 8,000 people from around the world.

  • The game archive can be found at: Welcome to the Superstruct Game Archive
  • The game required players to forecast future scenarios for the year 2019. It provides an excellent example of a large scale scenario planning exercise. You can use insights gained from the Superstruct approach and its outcomes to conduct a scenario planning exercise in your organization.

Organize an external search initiative.

  • Invite people to participate in an initiative to explore what other organizations in other industries or sectors are doing and how you might be able to apply this to your organization.
  • Select an industry or organization that is very different from yours and has a reputation for excelling in something that you are interested in or need e.g. a hospital system striving to embed patient-centered care in its culture might research an organization known to excel in providing an outstanding customer experience.
  • Ask people to answer one question such as “what is this organization doing that makes them excel at…”
  • They can do this in small teams or individually.
  • Set a time frame that is realistic but not too long for their research.
  • If possible, provide an opportunity for them to visit the target organization or meet in person or virtually with people in relevant roles so they can see and hear for themselves what the other organization is doing.
  • Consider providing people with time to do the exercise e.g. ½ day booked off from other work activities.
  • Bring everyone together at the end of the research period to do some brainstorming (or other creative problem-solving technique) of ideas that can be applied in your organization.

Question the existing belief system of your organization.

  • A belief is an approach, way of working and so on that people view as required to be successful. For example, look at the way important decisions are made. If these are made by consensus, it likely indicates the belief that the collective makes better quality decisions than individuals or taking the time to get everyone in agreement means that implementation will be faster and smoother.
  • Be warned that this is not an easy task. It requires identifying the often unspoken belief systems that have been embedded in all aspects of the organization including its structure, processes and so on.

Questions you can ask yourself and others that can be helpful are:

  • What are the ‘sacred cows’ in this organization?
  • These are the inviolable and unspoken rules that everyone must follow. For example, an unspoken rule in an oil company was that, regardless of its perceived value, you must ‘follow the process’, ‘complete the tasks on a checklist’ and so on. This developed from the belief that, as an organization that has the potential to have a massive environmental impact, compliance to policies and processes is essential. This got to the point where there was evidence of unquestioning compliance including the completion of tasks that had no value.

Once you’ve identified a ‘sacred cow’ continue with questions such as…

  • Why do we comply with these unspoken ‘rules’?
  • What would happen if we didn’t do this or did it differently?
  • What is stopping us from doing something different?
  • What do we as a collective believe is important in the way we interact with each other, do our jobs, serve our customers and so on?

How is this revealed in the way we do things on a day-to-day basis?

  • Ask for stories to illustrate the beliefs that are identified. This will help to determine if it is real or hypothetical.
  • What if we did things differently? What would happen?

If you need help shaping or changing your company’s culture check out our products and services at Culture-Strategy Fit today!

Creating A Culture Of Transparency: Disclosing Sensitive Information

disclosing sensitive information

Disclosing Sensitive Information

There is a wide range of reasons that leaders give to justify delays in sharing information with employees and others. This includes minimizing the risk of leaks to outside parties such as competitors, financial analysts and others who may use the information in a way that is harmful to the organization. The desire to minimize or delay employee anxiety related to decisions that affect them such as plant closures, layoffs, restructuring and so on is another. A further one is a perceived need to have plans fully developed so that people can be provided with details such as what is going to happen by when. In some cases, the delays are based on the hope that things are going to change for the better and the belief that disclosing what is happening would create unnecessary angst that may negatively affect the situation. While the motives may be well grounded, the decision to delay disclosing sensitive information often backfires. At one extreme, there are situations such as Enron and WorldCom that led to new laws and regulations that require organizations to fully and effectively disclose their financials. This leaves the vast majority of other situations that we are concerned with here where leaders have to make a decision as to what and when information is shared. The thing to keep in mind is that most people notice what is going on around them especially if they think it may affect them. When this happens, they speak with others who may very well be noticing the same thing. They start asking questions and speculating quickly expanding the number of people participating in the conversations. The next thing you know, the rumor mill is alive and active and the very thing you were hoping to avoid now exists. Employees are upset, productivity is down and performance is negatively affected.

Behaviors

Tell people when you are sharing sensitive information, ask them to handle it appropriately (be clear what this means) and explain the consequences for not doing so.

When sharing sensitive information be sure to include the reason that it is to be kept confidential such as the implications to the organization if it is leaked to competitors. People are more likely to be discrete if they understand and believe the reasons given for not sharing the information.

The consequences of leaking information need to be clear and explained up front. These can range from exclusion from future discussions of sensitive information to termination depending on the situation. Note: If termination is a consequence, you will need to have Human Resources involved from the beginning to ensure that you are complying with organizational policies and legal requirements.

‘Put the elephant in the room’ – open up conversations about the unspoken issues that everyone is thinking about but are not being openly discussed.

  • Organizations that are in dynamic environments and/or experiencing substantial change are breeding grounds for rumors and incorrect assumptions. For example, people may interpret a drop in share price, failure to deliver on market expectations with respect to revenues and profitability, emergence of a new competitor or other events as signs that people are going to lose their jobs. This can damage morale, deflect attention from productive work and negatively affect performance.

Be vigilant in monitoring for this behavior. If you believe that this is happening, address it quickly and effectively (see Managing the Rumor Mill).

  • When problems occur such as mistakes, missed deliverables, interpersonal conflicts and disagreements, people can tend to avoid discussing or dealing with them usually in the hope that they will go away.

This approach works once in a while but, in most cases, failure to effectively deal with conflicts and disagreements can cause them to fester negatively affecting relationships, productivity, and performance.

  • Focus on the facts – ‘what do we know for sure?’ – and address unfounded rumors and assumptions.
  •  If there is a genuine reason for people to be concerned, acknowledge their concerns and tell them what you can including when they can expect to receive specific information.
  • Never, under any circumstances, mislead or lie to people as this will cause long-term damage to your credibility and effectiveness as a leader.
  •  If you don’t agree with a decision or don’t understand it, take the steps necessary to be able to explain it appropriately and effectively to others.

Ask questions and, when needed, clearly state your concerns including you don’t understand the reason for the decision.

  • Avoid putting others on the defensive. Your motive should be to understand the decision and the rationale behind it so that you can credibly communicate it to others.

Keep in mind that it is not necessary for you to agree with or like the decision if it is not your decision to make.

  •  In this situation, you do not have the right to publicly criticize the person or the decision. This has no value and can only harm your relationship with the other person, diminish collaboration and potentially damage your and his/her credibility.
  • When others ask you questions about the decision, communicate the facts and do not add your personal view or opinion. This includes saying things like, ‘I don’t agree with this but…’
  • Your responsibility is to make sure that you, your team, department or organization does what is needed to support the decision and achieve the desired outcome. Focusing discussion on what your team needs to do is much more productive than conversations about what is wrong with the decision and the person who made it.
  • Avoid saying ‘I don’t know’, ‘this is just the way it is’, ‘it’s their decision, not mine’ etc. when others ask you questions.

Social Practices

Always, to the extent possible, share sensitive information such as people affecting decisions face-to-face.

  • Keep in mind that when sharing people-affecting information, timeliness is essential.
  • This can be a challenge for teams that are geographically and/or temporally dispersed e.g. shift workers.
  • If direct face-to-face communication isn’t possible in a timely manner, consider deploying delegates in different locations to facilitate local conversations.
  • A combination of broadcast video communication accompanied by local, small group breakouts that share the results of their discussions with the large group can be very effective.

It is important to provide opportunities for people to ‘safely’ ask questions and state their concerns.

  • This usually does not apply to large group scenarios such as town halls or other meetings hosted by senior leaders.
  • These conversations only happen between people who respect and trust each other. In most cases, this exists most often between front-line managers/supervisors and their staff. For this reason, consider using communication strategies that focus on manager-employee dialogue.
  • Consider phasing the communications to allow people opportunities to reflect on and discuss what they heard then come back with their questions and concerns at a separate session held in the near future.

Take the time to ensure understanding by offering explanations and raising questions that you believe people may be thinking but not asking.

  • Keep an open-door policy and encourage people to come and ask you questions if they are unclear as to the reason for a decision etc.
  • Consider posting a schedule that shows when you are available. A general rule of thumb is one hour two to three times a week.
  • Other options include holding informal lunch gatherings where people can bring their lunch to a meeting room for a general conversation about questions and concerns they may have.

Managing Practices

Hold regular staff meetings.

  • One of the most effective ways to ensure an adequate flow of information is to plan and hold regular meetings or conference calls where time is allotted to discuss questions or concerns that people may have.

Critically test the need for secrecy of information.

  • A common trap that leaders fall into is to err on the side of secrecy. In other words, because complete secrecy is required in handling certain information (e.g. something that may affect share price) or the leader has been burned in the past (e.g. strategic plans were leaked to a competitor), he/she decides to share nothing or very little about anything until it is 100% safe to do so.
  • Another common situation is that secrecy is requested by another person or group such as Human Resources. This typically happens in situations that are perceived to affect employees such as changes to organizational structure, roles and responsibilities, and staffing levels.

Work with the other person or group to clearly define a communication plan that identifies what can be communicated to employees at what time. This includes when you can share the communication plan itself with employees.

  • Respect for the agreement. Do not disclose information that others have asked that you keep confidential.
  • Clearly explain the process you and/or others are going to use to make a decision on a sensitive topic, such as whether to shut down a work shift or production line.
  • Make a conscious decision with respect to the decision-making process that you are going to use e.g. consensus, democratic vote, unilateral decision and so on.

If you are going to provide opportunities for people to provide their ideas and suggestions, let them know when this is going to happen and what the scope of consultation/involvement is going to be.

  • For example, are all employees going to have an opportunity to be part of the process? How is this going to happen? When will employees be provided with information telling them about logistics for the sessions?
  • Clearly, indicate what you and/or others are going to do with the input provided by employees. This should include what information gathered through employee consultation will be shared and when this will happen.
  • Make sure that you close the loop by thanking employees for their input and explaining how the information and suggestions they provided affected the decision. This should also include an explanation of suggestions that were discarded with the rationale for why this happened.

Search Practices

Identify opportunities to continually improve information sharing.

  • Treat communication and information sharing as a core business process.
  • Use different situations as scenarios to evaluate the effectiveness of information sharing and identify what worked and what can be done to do it better the next time.
  • Consider using an approach such as those provided in the section on Learning from the Past.

Action Strategies

Train managers on effective communication skills.

  • Evaluate individual capability in critical skills such as holding difficult conversations, dealing effectively with sensitive information, and engaging people in dialogue.
  • Provide targeted skills development supplemented by post-training support systems such as additional learning resources, peer coaching networks, Human Resources support, direct coaching and so on.
  • Periodically, evaluate individual manager effectiveness to identify additional support and development requirements.

Assess the effectiveness of communications within your area of responsibility.

  • Conduct a survey, a series of focus groups or other data collection method that provides specific information on the effectiveness of information sharing. This should include criteria such as timeliness, accuracy, accessibility, and completeness of the information that is shared using various communication methods.
  • Use the data that is gathered to refine and improve information sharing.

Develop a communication strategy and plan for your area.

  • This applies to small teams as well as large departments and organizations. Any time a group of people is working together, it is important to clarify expectations with respect to communications.
  • Taking the time to develop a communication plan and strategy provides the opportunity to assess the effectiveness of current information sharing practices and approaches and identify ways these can be improved.
  • Guidelines for creating communications strategies and plans are available on the web. Two examples are available at the following sites:

 1) http://www.odi.org.uk/resources/details.asp?id=5186&title=communications-strategy-planning

2) http://www.bandwidthonline.org/howdoi/communications_strategy.asp

How To Create A Company Culture Of Transparency

company transparency

Transparency is a quality we value in others, but especially our leaders. It is essential to establishing and maintaining credibility and trust, which in turn contributes to positive relationships, collaboration, idea generation and the sharing of knowledge. In organizations that value transparency, there is an understanding that information can and will be shared.

Further, when it is shared, the information is accurate and disseminated in a timely a manner as possible. In return, it is understood that people will respect the confidentiality of the information that is shared and will not use it to cause harm to any person or the organization.

Reciprocity can also be seen in interpersonal communications. People at all levels are expected to openly, honestly and respectfully state their opinions, voice their concerns, ask questions and share what they know with others. This is possible because leaders not only role model the same behaviors; they also create the conditions that encourage and support them.

There are a number of ways leaders can encourage transparency and reciprocity, such as having an open-door policy, holding regular staff meetings and emailing updates as events happen. There are however times when leaders believe they are transparent, but people’s experience and/or perceptions indicate otherwise. A classic indicator this is happening is an over-active rumor mill. As a leader, what do you do? How do you bring the rumor mill into the open where issues, concerns and questions can be dealt with in a way that demonstrates transparency and encourages reciprocity?

Managing the Rumor Mill (Example)

There are a lot of rumors flying around this organization. Some are based in fact but many are pure speculation. On principle, I have refused to participate in or acknowledge rumors. I share the information that I can when I am able to do so. However, I have been told that people in my department are hearing about things from others before they hear them from me. They interpret this as I am being secretive and/or don’t trust them to be discrete. They wonder why other people are being told things and they aren’t.  

The behavior I am going to start, stop or continue doing every day is….

Walk around and ask people what rumors are going around.

  • I am going to let people know when I plan to update them on the rumors and answer questions they may have. I am going to include the reasons for the timing emphasizing that I will share the information I can with them as soon as I am in a position to do so.
  • I will always tell them what I can even if it is only to say when I will be in a position to share the information with them and why.
  • I will not say ‘no comment’, become defensive or ‘play dumb’ as this will ruin my credibility and/or cause increased frustration.
  • If there are things that I can address immediately, I will do so and follow-up with an e-mail to my entire team.

Eat my lunch in the cafeteria so that I can speak with people in my department about their questions and concerns.

  • I am going to sit with a different group every day, if possible.
  • I will ask them questions about things they are hearing, the rumors that are circulating and so on.
  • I am going to listen to what they have to say and let them know what and when they can expect to hear something.
  • I am going to use what I learn to develop a communication strategy with my team that will let people know what I am doing to address the rumors.

The practices I am going to use are…

Hold a weekly teleconference open to all employees in my business unit to address rumors and answer questions.

  • This will continue until we are through the current slate of major changes being implemented in the organization.
  • I will gradually extend the time between these sessions as appropriate to the level of activity in the rumor mill and changes being planned and implemented.
  • I am going to invite people to send me their questions ahead of time either by e-mail or by anonymous written submission.
  • I am not going to ask people to sign their names to encourage everyone to come forward with their concerns. Hopefully, in time, they will feel safe enough to sign their names.

  Develop a communication plan that emphasizes things that my direct reports and their management teams can do to better communicate and manage the rumor mill.

  • We know that people tend to speak more openly with others who they know and trust. I am personally too far removed from many of them to have this kind of open relationship.
  • I am going to suggest that my direct reports meet with their teams on a weekly basis to identify questions and concerns that are circulating.
  • We will review and discuss these as a team and develop a plan to address the issues and concerns that are identified.
  • My role is to help the communicators (my direct reports and their management teams) to be consistent, timely and accurate in sharing information. I am going to ask my direct reports what assistance they need from me.

  Request that my direct reports send me a short e-mail when they hear a rumor that is circulating in my organization.

  • I am not ‘in the loop’ as to what all of the issues and concerns are which makes it difficult to know what people are thinking.
  • I am going to ask them to flag ‘hot’ issues that are causing a lot of angst and negatively affecting productivity so, if needed, I can address them or escalate them so that they can be dealt with as quickly as possible.

  Send an e-mail to my direct reports as soon as information is available that can be shared with employees.

  • If needed, I will make myself available for a call to answer questions and, if appropriate, make sure that the information is communicated in an accurate and consistent manner.
  • My expectation is that my direct reports will immediately host a conference call with their team and/or all employees in their departments to share the information that has been made available.
  • My weekly conference call (see above) will be used to clarify the situation and answer any remaining questions or concerns.

The action strategy I am going to use is…

  Provide managers in my business unit with training on how to handle rumors effectively.

  • I am going to ask Human Resources to help me identify a trainer who can work with me to tailor a workshop that addresses the situation in our organization and also includes some communication skills training.
  • This needs to be completed quickly so that my direct reports and their managers are capable of executing the communication plan including managing rumors that are circulating.

I will know I have achieved my goal when….

  • We are identifying and effectively dealing with rumors that emerge and circulate in the organization.
  • More importantly, we are communicating in a manner that makes the rumor mill redundant. Employees are hearing what they need to hear and trust that we are telling them everything we can as soon as it is possible to do so. Instead of participating in the rumor mill, they are going to their manager or myself with their questions and concerns.

The Chocolate Factory Culture Change Simulation

Company Culture

Companies today more than ever are faced with rapidly changing environments – new competitors, evolving customer expectations, changing demographics, emerging technology – all of which are working together to create more and more pressure on results.  Many companies are discovering that their successful playbooks of the past are no longer working resulting in changes to strategy and/or operating models. The challenge is the culture which helped you get your company to where it is today may no longer be the one required for the future. It, like everything else in business, needs to evolve and advance in order to keep pace with external and internal change.

Unfortunately, the majority of leaders don’t know how to change culture. Many shy away because of concerns culture change is too vague, time-consuming and complex and/or a lack of ‘how-to’ knowledge. If they do try and make a cultural change, they typically revisit the company’s values and clarify behavior expectations which is great but not enough to ensure sustained success.

Success requires leaders approach culture change as both an art and a discipline. The art is in the ability to create something meaningful that captures the imagination and passion of others. The discipline is in making this a reality by using culture change levers in an intentional way. The good news….leaders, any leader, can learn how to do this. And The Chocolate Factory Culture Change Simulation is what you need to do just that. It’s a meaningful hands-on culture activity, The Chocolate Factory Culture Change Simulation helps leaders at all levels develop their leadership capabilities in a fun and effective way.

The Chocolate Factory Simulation

Imagine an experience where the behaviors of leaders and their impact on significant organizational outcomes are revealed in real-time. Imagine that at the end of 3 – 5 hours, leaders, individually and collectively, are equipped with the practical knowledge they need to confidently implement successful culture change within their departments, business units or organizations. The Chocolate Factory Culture Change Simulation provides a way for organizations to fast-track the process of changing their culture by providing leaders at all levels with a practical approach for achieving effective culture change main objectives include:

   ~ Helping leaders understand their role in shaping and changing their company’s culture.

   ~ Helping leaders use levers to intentionally shape and change their company’s culture.

   ~ Helping leaders understand the link between values, culture, and performance.

Further, the simulation will help you answer the following important cultural questions:

   ~ How do leaders achieve culture change?

   ~ How do leaders behaviors influence culture?

   ~ How do we create a collaborative culture?

   ~ How do we create a culture that promotes innovation?

   ~ What behaviors most contributed to finding a powerful solution? Impeded it?

What Is Company Culture?

Company culture is not just for large, established corporations. It is, on the contrary, an elementary part of every business, which (whether you realize it or not) lies deep within the bones of every company.

Company culture has been defined differently by different people. What they all have in common, though, is the fact that company culture necessarily deals with why and how people do what they do within a business. It involves:

   ~ Company Vision/Mission

   ~ Behavioral Norms

   ~ Symbols

   ~ Values

   ~ Language

   ~ Assumptions

   ~ Systems

   ~ Habits

   ~ Beliefs/Ideology

Any company serious about its culture needs to understand how these various components are working together to support strategy execution and goal achievement  This should be done sooner rather than later.

The good news is leaders have the means to create high-performing cultures at their fingertips. What they lack is the know-how. The Chocolate Factory Culture Change Simulation fills this gap by providing a simple and practical framework they can use to proactively influence and shape culture.

Who Is The Chocolate Factory Simulation For?

Companies today more than ever are faced with rapidly changing environments – new competitors, evolving customer expectations, changing demographics, emerging technology – all of which are working together to create more and more pressure on results, and many companies are discovering that their successful playbooks of the past are no longer working. The culture which helped you get your company to where it is today may longer be enough, it, like everything else in business, needs to evolve and advance in order to keep pace with external change.

Another instance in which the Chocolate Factory Simulation may be useful is when companies want to make a major strategic because it helps leaders know what to do to shift their organization’s culture so that it is aligned with company’s new strategy.

The problem is that leaders don’t know how to change culture. Many shy away because of concerns about a company’s culture being too vague, time-consuming and complex or, if they do try and make a cultural change, they typically revisit the company’s values and clarify behavior expectations but they don’t actually change the system to support the desired behaviors. Such an approach is sure to fail.

How It Works

In the simulation, you are a leader in a complex chocolate manufacturer with multiple locations and business units, from kids candy to premium chocolates. The problem you’re facing is dramatically shrinking profits.

Also, an exciting innovation is emerging in the chocolate industry which has the potential to dramatically increase sales. But the question is: Can you and the other leaders in your organization work together to make tough decisions and capitalize on this financially lucrative opportunity. Representing four Business Departments, plus Research and Development and the Executive Team, the groups must rapidly craft recommendations to your Board about how to improve profits to save your company for short and long-term.

This fast-moving simulation provides the opportunity for groups to experience their own culture dynamics and gain insights into the behaviors and assumptions that are operating to support or diminish breakthrough performance gains. They also examine how the design of different elements of the organization ‘system’ influence culture. The result is a practical approach they can use to intentionally create the culture their department, business unit or organization needs to achieve its goals.

When To Use

The simulation is designed for leaders at all levels who are tasked with creating a high-performance culture. This includes executive teams, mid-level managers, project teams, culture champion networks, department, and business unit leaders, HR/OD teams and others. Use it as part of:

   ~ Leadership development programs and retreats

   ~ Department defectiveness initiatives

   ~ Culture change initiatives

   ~ Business transformation initiatives

   ~ M&A integration

   ~ Department amalgamations

Cultivate meaningful, professionally-rewarding interactions within your company via our Chocolate Factory Culture Change Simulation or please feel free give us a call today at (800) 976-1660 for more information or email us at inquiry@culturestrategyfit.com.