As a management consult who has worked with strategic change management the last 15 years I often see that in a change processes that one forget to consider the internal corporate culture. As a CEO, you cannot only give order. Here I speak of own experience as CEO, you can give orders as much as you want, but it will not help if the culture is not changed. As CEO, you are undoubtedly the person of formal power in the organizations.
Ironically, by exercising your power by giving orders for an implementation of change, you reduce your real power, which again helps to slow down the progress you had desired.
Should you exercise direct power, it must do very selectively and consciously – and never without a wider action plan in mind. Usually, power is best used indirectly, through disciplined business processes. Together with the pace and tone, having good business processes means that you as CEO can make effective decisions in accordance with where you want the company to develop.
So, what is Culture? Here is some definitions.
- a) the integrated pattern of human knowledge, belief, and behavior that depends upon the capacity for learning and transmitting knowledge to succeeding generations.
- b) the customary beliefs, social forms, and material traits of a racial, religious or social group; also: the characteristic features of everyday existence (as diversions or a way of life) shared by people in a place or time.
- c) the set of shared attitudes, values, goals and practices that characterizes an institution or organization.
- d) the set of values, conventions or social practices associated with a field, activity or societal characteristic.
The culture is the everyday reality of organizational life. Within that, all the above-mentioned definitions apply. The culture is not the mission statement, the vision, your bank balance or the staff handbook, though all those contribute to creating it. The culture is what we do and say, the way we behave, the way we treat each other, our products, our customers, our community and ourselves. In essence, it’s the “personality of the company.
While speeches, grand plans, fancy training manuals, etc., have some influence on the culture, they are just as likely to have a negative as a positive influence. Ultimately, it’s what leaders do much more than what we say that makes the culture what it is.
Creating a Culture
There are only two main ways to build an organizational culture: either with consideration and conscious intent; or, by contrast, to let the culture come together as it does, giving it little thought in the process.
What follows is your recipe for consciously creating an organizational culture. Like all recipes, it’s not perfect. But, if you use it, you will radically increase the odds of creating the culture you want.
The more—and more effectively—you teach people what you are looking for in our culture, the more likely it will become the reality. Whatever orientation and training work you’re doing, you should talk about the kind of culture you’re going after. Describe the way you’d like things to be working. Talk about the informal ways in which you envision the group working together, the way you want the customer experience to feel, etc.
One of the best ways to teach the culture is to tell stories. There’s something solid that resonates when people hear nice tales of how things were handled in a difficult situation, or how the organization has successfully progressed to where it is. There’s a substantive wisdom that comes from these stories, an experiential element of teaching that goes beyond the intellectual theories. And because culture is what’s happening, not just what we say should be going on, the stories resonate in ways that pure theory cannot.
If you have several executives running your organization, you may not immediately have full agreement on what your desired culture is. In that case, there must be hard discussion amongst the key decision makers so that you can reach a consensus.
Putting the vision in writing is an essential element of making it successful. When the dialogue stays verbal only, it’s inevitable that everyone will leave the room with a different version of what was agreed upon. Documenting it is far more likely to help you get where you want to go.
Culture is very little about what we say, and very much about what we do. If we don’t live it, it’s never going to play out as we want. Organizational culture is built slowly over time, not with a quick fix as someone might believe.
This is especially critical for the executives in your organizations; the staff sees everything you do. As a former CEO, I always remind myself that every action I took and every word I spoke will have an impact on how the organizational culture develops. Pretending that my words, actions and attitudes didn`t impact it significantly would be to live in denial.
(The influence of the leader is particularly strong in a start-up situation. Things are moving quickly; people are operating in close quarters usually under high stress and behaviors can have long and lasting effects.)
Some of the meaningful ways that leaders impact the culture include: • how well our words match your deeds • how you handle things when they don’t match up • which of your values you live and which you only pay lip service to • who you hire and who you fire • who you reward and who you don’t • the systems/recipes/processes you put in place • how you handle failure
How you manage difficult situations is one of the biggest contributors to the creation of organizational culture. It’s easier to build a culture when everything is going well. But strong cultures are partially built by what you do during hard times. When money is tight, how do you act? When a staff member is ill, how do you respond? Etc.
The culture is how you handle it when you don’t live up to what you say. By openly accepting that you’ve erred, acknowledging what’s happened, apologizing for it and then moving forward together toward the future, everything works more effectively. By handling problems in a constructive way, you are building the culture you want.
Ultimately, everybody needs to take responsibility to personally live the culture that you want to create. None of us will get there perfectly as individuals. But that’s where diversity is so great; if you can a) build a group/team that together embodies all the characteristics that you’re seeking and then b) actually handle that diversity with respect and inclusiveness not divisiveness, you’re moving toward the organizational culture you seek.
It is incumbent on everyone in the organization—not just owners and managers—to take responsibility for the culture we have and to make it the culture they want. The most effective organizations and the most solid cultures are where everybody comes reasonably close to living the culture, and can acknowledge constructively where they’re falling short and then actively move toward either getting better and/or actively supporting the others that are already doing it better.
Once you’ve identified the key elements of your desired culture and written them down, you must measure your success in making them a (cultural) reality. Many will argue that you cannot measure things like fun or supportiveness or camaraderie; I think you can. If you want to have a results-oriented organization, you are more likely to succeed if you measure your success at putting the culture into place. If you’re setting out to measure cultural characteristics like “fun, remember that the judgment will be made by the participants in the organization. Once you have that mindset, along with some definition of what “fun means, you can measure it. Just have people rate how much “fun they had at the end of every shift and tally the answers. When you track those scores week to week, you can talk about what to do to improve your “fun quotient and then implement an action plan.
A common problem in every organization is the mismatch between what it says it wants and what’s rewarded. In some cases, the issue is just an absence of rewards. Companies say that want people to treat each other well but those who do receive no recognition; they say that they want to have fun but the only reward you get is . . . you’re having fun; they say that they want people to learn but the only reward is that they know more than before a seminar. The situation can be more extreme—organizations that reward the opposite of the cultural behavior they say they’re seeking. They say they want to be generous, but they take for themselves first. They say that they want teamwork, but pay bonuses based on individual performance. No organization will ever perfectly align every reward with the behaviors we seek. But at least being cognizant of the key elements of the cultural vision we’re going after and then making sure that we recognize and reward those is important.
Please note that I’m not talking about money per se, though that could certainly be one way to reward people. But money alone will never do the trick. We need to use multiple methods in various settings; positive cultures are built over time and take a wide range of rewards and recognition.
Changing an Existing Culture
There’s no quick fix that that begets cultural change in a matter of days, weeks or even months; it’s infinitely easier to rewrite a system than it is to change the culture of an organization. It requires tons of communication, years of stubborn persistence, relentless follow up, and probably a little luck. Fact is, you can never “get rid of the parts of the culture you don’t like. More realistically what works is to gradually build up the strengths around the less desirable elements so that the “problems become smaller impediments to getting to where you want to go.
What I’ve always been taught is that cultural change takes about a “generation. The good news is that because todays organizations have higher turnover one can make cultural change happen more quickly than it might in, for instance before when people was on the same workplace whole life.
My rule of thumb for meaningful cultural change is that it takes two to three years to get something woven into the organization. I’m often impatient about how long it takes, but the reality is that’s just the way it is. By accepting that reality rather than fighting it, one can do a much better job of managing change by supporting the change process. Three or four weeks into most any change, there still will be lots of problems and challenges; in three or four months, the glamour of the idea of the change will have long since worn off. At that point, leaders need to refocus people on the long-term vision, to give encouragement and energy to get through the seemingly inevitable “zone of doubt and blame”. Some years ago, I implemented Lean Management in a Norwegian organizations. Even if the Group CEO had decided that the organizations should work with Lean Management it took almost three years before it started to show effect in the organizations.
Handling Cultural Gaps
In the perfect world, that does not exist, one can deliver perfectly results on our cultural vision all the time.
The reality is that even the most effective organizations will have gaps between the ways they want things to be and the way people behave culturally.
Different Cultures in Different Parts of the Organization
If you have a business where people don’t all work together in the same space nearly all the time—either because you have different locations, a big building, extended hours or some combination of all three—you’re going to end up with different cultures in different parts of the organization. That’s not a bad thing in my mind. It’s normal.
One can certainly have one coherent culture across the organization even though one work in six or seven geographic locations. But you’ll find a slightly different version of that culture in Oslo than in Vilnius. And within each of those businesses you’ll find cultural variation between the various departments and shifts.
The key for leaders is not to fight against this diversity, but rather to focus on the positive. What’s your vision of the culture, and what do you need to do to get there? What’s the vision of organizational culture that you’re going after? What actions do you need to take to build the culture you have visioned?
Losing What You Have While Building for the Future
This comes up regularly with organizations that have created the kind of culture that they sought early in their business development. Leaders and/or key long-time staff worry about protecting their culture when growing. Although the concern is valid, I revert to my image of organizations as people. You can worry (and appropriately so) about what’s going to happen to your kid if you let him out of the house. But at some point, they will start going out. And you can’t—nor should you—stop them.
Of far greater value would be to back up to the beginning and start by teaching, visioning, etc. You cannot stop your organization’s culture from evolving. It’s going to change, and next year it will be different than today. The key is to avoid the negative vision—it’s not about what you don’t want to happen to the culture as the organization develops. Growth is a positive thing. The question instead is, “Given the growth that you’re going after and the way the world may change around you, what would the organizational culture of your dreams look like in five years? By writing down the vision of the culture you will create, you are likely to get there.