Posted on 15. May, 2015 by in Gary's Blog

Our initial blog post about the importance of culture to overall organizational performance received many positive responses. And there were a few consistent themes in people’s comments:

1. The notion that culture was critically important to overall organizational success was spot on for people. Almost everyone mentioned that they loved the Peter Drucker quote: “Culture eats strategy for breakfast.”

2. Everyone agrees that senior leaders need to spend more time leading and shaping their work environment if they are serious about improving creativity and innovation.

3. While our post focused on navigating the digital landscape, the need for leaders to create an engaging culture clearly applies to all change efforts.

Several people asked if we could be more explicit about what culture is and how it manifests itself. So here goes:

1) Culture Defined: Culture is the formal and informal “guiding principles” that shape the way individuals in an organization operate. These principles serve as behavioral guideposts for the way employees interact both internally and externally. For internal behavior, we believe the key variable that distinguishes a healthy culture is a high level of TRUST. Individuals believe it is safe to raise objections, to challenge long-standing assumptions, and, most importantly, to disagree with the boss. They trust that there is no long or short-term jeopardy or retribution for doing so.

2) How It Works: Culture can’t be a “thing” or a string of well-crafted words that suggest a particular way of operating. It needs to be a deeply felt set of behaviors that leaders and employees are committed to living by – everyone engages in “walking-the-talk”. Many organizations articulate what these values or behaviors are. Far fewer companies implement them successfully. We believe the critical variables for creating a winning culture are:

• All the senior leaders agree on the critically important values and behaviors
• The senior leaders actually believe they matter
• The senior leaders engage multiple levels of the organization early in identifying the key values and make changes based on this input
• There is a strategy for cascading the values throughout the organization
• Most importantly, senior leaders visibly “live” the values on a daily basis and hold their direct reports accountable for doing the same

An example of how things break down: most organizations talk about the need for candor and open dialogue when there are conflicting perspectives. Sadly this cultural value gets more lip service than real action. As a result, there is still a great deal of nervousness or fear about candid “push-back”, particularly if you disagree with your boss. The disconnect between words and actions creates a major “trust deficit”.

The ultimate question is “how do you avoid the disconnect?” The answer is there is no foolproof formula. All organizations are different; therefore they must create their own unique implementation strategy. That said, there are several steps we recommend for addressing the culture issue:

1. Senior Team Offsite: The senior team sets aside time to determine what is currently working and what is not working in the culture. They work together to reach a consensus on the specific behaviors they believe are essential for future success. Then the team builds a practical communication plan and an action plan for integrating these behaviors into the daily fabric of the organization.

2. Feedback: Before implementing the plan, senior leaders actively seek feedback on the cultural values from key cross sections of the organization. This is a critically important step, because it builds internal commitment and ownership beyond the C-Suite for the agreed-upon behaviors. Feedback in hand, senior leaders regroup and make revisions and course corrections as necessary.

3. The Communication Plan is rolled out: The rationale for having specific cultural values and the expectations for making them come alive are communicated to the entire organization.

4. Senior team leaders implement their personal action plans: Senior leaders take concrete steps to clarify what the values are and to address any concerns or issues people have about them. They also communicate their personal commitment for living the values and their expectations about making them come alive in the organization.

5. The proof is in the pudding: What happens after the roll out is what really counts. Do the senior leaders stay committed to living the values and provide feedback to individuals who don’t?

We are currently in the process of designing a C-Suite Leadership Workshop that we think will have a unique twist on how senior teams can use culture to significantly improve their organization’s ability to innovate and experiment in this era of ongoing change.

➢ Authors Joe Collins and Gary Schuman work extensively with C-Suite Leaders to help them navigate the leadership issues involved in culture change.

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