Great organizations have distinct corporate cultures. There is no â€˜ideal prototypeâ€™. They have longevity, coping with changing times and different generations effortlessly. Most organisations, however, are mired in traditional thinking and short term focus. How do you change this, and make your corporate culture a competitive advantage?
Great organizations have distinct corporate cultures. These cultures vary considerably, shaped by a multiplicity of factors. There is no â€˜ideal prototypeâ€™, often shaped by strong leaders, entrepreneurs, mavericks who have the desire to create something different or unique. They have longevity, coping with changing times and different generations effortlessly.
In stark contrast, most organizations, whose management prefers to focus on short term performance, efficiency and financial factors, appear to have greater difficulty creating and sustaining an appealing culture. They may desire a distinct corporate culture but struggle to make it happen, ultimately resorting to executive decrees â€˜demandingâ€™ the culture. Alternatively they â€˜donâ€™t believe in this stuffâ€™ and without even trying end up with a confused assortment of cultures, primarily catalyzed by strong informal leaders who drift through parts of the organization over time.
Corporate Culture as Competitive Advantage
Leaders in great organizations work hard at sustaining their culture, because they appreciate the market advantage that this culture creates for them. They cherish and nurture it, understanding what stimulates its sustainability. The culture clearly positions that organization in its chosen markets, locally and globally. It shapes their marketing or sales strategies. The culture attracts the most talented, like minded individuals to it. They have a sense of confidence in what the organization stands for and how it chooses to behave.
We are not all born identical. Human nature or personality varies considerably from individual to individual, with normal behavior for one being unacceptable to another. Similarly our value systems differ. What is important and necessary to me â€? may be inconsequential and irrelevant to you. And there is no single personality prototype or value system that is â€˜rightâ€™ for everyone.
What complicates matters is that many individuals do not know for themselves â€˜where they are atâ€™ behaviorally. They do not have a clear understanding of who they are as individuals/ what they believe in/ or what they actually stand for. They find it extremely difficult to cope in a complex ever changing world, clutching at fads and trusting popular psychology trends, and blown from pillar to post as they attempt to cope with lifeâ€™s challenges. Each person must choose for him or herself who they really are and what they stand for. Thatâ€™s difficult enough.
What when we put hundreds or thousands of individuals together in an organization? With ever increasing divides between people (age groups; professional disciplines; ethnic groupings; socials preferences; spiritual beliefs; etc ) and escalating professional challenges people face, it becomes critically important for organizations to define â€˜who they are and what they wish to beâ€™, not it terms of business objectives, but rather in terms of what the organization stands for â€? core values, beliefs, what personality and perspective they wish to present to the world.
Without this â€šwho are we/ what we stand for statement, which is non-negotiable and lived, and one that is long term and timeless, the divides between employees will be exacerbated as the organization grows, particularly by individuals seeking to pull the organization their way, consciously or unconsciously.
â€š it doesnâ€™t help to just know what we have to shoot for if we donâ€™t know what we stand forâ€›
â€špeople are loyal not to a particular boss or even to a company, but to a set of values they believe in and find satisfyingâ€› Goran Lindahl â€? President ABB
This â€šwho we are/what we stand forâ€› statement should be encapsulated in the â€˜values statementâ€™ of the organization. These values should clearly express what is sacrosanct in terms of behavior in the organization. They will shape what Hornstein terms the â€špsychological golden rule for organizationsâ€›.
â€šCall it loyalty, commitment, dedication or emotional attachment, itâ€™s what gets people to identify with an organization. It differentiates between experiencing â€˜usâ€™ and â€˜themâ€™. Without this clear definition of â€˜we/usâ€™, â€˜they/themâ€™ canâ€™t join in or donâ€™t know what they are joining. A sense of unity doesnâ€™t occur. In strong cultures there are very few â€šthey/themâ€™sâ€› and the vast majority of â€šwe/usâ€™sâ€›.
If these values are not developed, nurtured and cherished, a collection of â€˜valuesâ€™ will coalesce informally, usually confusingly and disjointedly, with little alignment, clarity or direction, only exacerbating the â€˜usâ€™ and â€˜themâ€™ situation. Employees experiences values that conflict with their own. The culture will be schizophrenic at best.
The values statement shapes corporate culture. The tighter and more defined these values are the more vibrant and resilient the culture is. In developing values three characteristics should be addressed. Values must be
- specific – they should not be vague, motherhood, generalized thoughts. Do not use words that are open to interpretation eg professional, customer focused, world class, leading â€Œ..
- unique – each word should be descriptive and differentiate the personality of the organization in its market. Eg nimble , flexible, proactive, conservative, â€Œ
- aligned – they should hang together, complimenting each other, not confusing or appearing contrary. Eg quick / nimble seldom goes with biggest; whereas flexible does go with trend setting !
Grouped together these values should clearly differentiate an organization, and unambiguously position the â€˜personalityâ€™ of the organization which is manifest in its culture. Shaped correctly they will not discriminate against anyone on the basis of age, ethnic grouping, social preferences, spiritual beliefs or sects etc., but rather clearly define the behavior/style that is expected.
Creating Sustainable Culture
Sustainable culture emerges when the organization actively employ people who naturally live the chosen values and exhibit the desired behavior. These employees live the values voluntarily, and need no training or monitoring to continuously behave in a culture enhancing manner. The employees buy into the culture because it is the most natural thing for them to do â€? the way they normally behave/ think/ view situations. It matches their frameworks â€? or how they see the world. These frameworks determine what employees believe is part of â€šusâ€› versus what is part of â€šthemâ€›.
This alignment should be the fundamental basis of both recruitment and promotion to positions of leadership. It is of far greater impact and significance than any technical skill. Only once the values/cultural fit have been determined, should the technical skill or affirmative action factors be considered. Organizations should preferably use psychometric tests to ascertain for themselves the degree of cultural fit. This is critical as many prospective employees, excited by the possibility of employment in a leading organization with a strong culture, will readily assure the interviewer that they definitely fit the culture naturally. Donâ€™t be fooled.
Cult- Like Behavior
Assuming the organization considers a distinct culture advantageous, and have determined a set of values they wish to adopt. But recruitment and promotion is primarily based on technical or affirmative action. They soon find new recruits live their own values and associate with pockets of like minded individuals in the organization, and that the organizations desired culture is not lived and values not adhered to. Employees do not buy into the prescribed values and desired culture â€? no matter how ideal it might be. Itâ€™s â€˜theirsâ€™ not â€˜oursâ€™. â€šWe donâ€™t associate with itâ€›. And owing to the wide divergence of preferred behavior or values likely being exhibited by employees, management decides to prescribe these values, with the objective of enforcing the values and adherence to the desired culture.
This is cult-like behavior â€? and is hugely destructive and achieves limited results in the short term via domineering or draconian management, which will ultimately prove very detrimental, debilitating and not sustainable. Sadly there is little appreciation by management that a strong positive culture evolves through team members willingly associating with, and voluntarily living the values because itâ€™s the most natural way for them to behave.
Culture / Growth Trap
Most small organizations start off with best intentions, stimulating a vibrant, dynamic and often industry changing culture, usually catalyzed by strong charismatic leadership. Clear behavioral values are in place. Rapid growth ensues, followed by a rush to bring in people, mostly due to need to enhance
technical capability, often into key leadership positions. If these leaders have no â€˜culture fitâ€™, the strong unified culture is challenged as these new leaders bring their own style/culture to bear in their business units. The organizations values statement still talks the original values, but actual behavior is contrary. The longer this disconnect is permitted to continue, the faster the original culture with be decimated and the greater the â€˜charadeâ€™ that is being played. And the organization knows it !
Sadly few organizational leaders either see it happening or understand itâ€™s ramifications, let alone have the courage to address it. Jack Welch did, with extraordinary success. The choice is quite simple â€? what is more important?
- Results â€? however they are achieved, mortgaging the original values for â€˜whatever it takes.â€™
- Remaining true to who we are/ what we stand for â€? as we strive to achieve the best results we can.
Of course everyone will want both. But both will not happen unless values/culture is the top priority. Only the second option offers long term sustainability, the first is very short term and unsustainable.
It is worth noting that the highly talented graduates entering the workforce are increasingly concerned with who you are/what you stand for, rather than the organizations short term performance, return to shareholders or reputation of senior executives!
So in summary organizational leaders should
- Know what your organization stands for.
- Articulate this clearly and consistently.
- Be extremely careful who you employ.
- Be even more careful who you promote into leadership roles.
- Remove performers who donâ€™t live the values. They are a cancer that fosters contrary behavior. Your employees are far cleverer than you think, as they see the disconnect between stated values and management behavior â€? particularly if that contrary behavior is rewarded. You loose credibility every time you talk values or put up a value statement.
- If you are not prepared to change the leaders who act contrary to the values, then be honest enough to change the values, and tell all you stakeholders what you actually do believe in and stand for. Stop living a charade and try and salvage some leadership credibility!
Let me repeat, great organizations have strong, clearly defined values and culture, and work extremely hard and sustaining who they are and what they stand for. So just how great do you want your organization to become?
Pete is an associate of TomorrowToday.biz, with a focus on Organisational Alchemy. With a history of leadership in the financial services sector, and nearly two decades of consulting experience, Peteâ€™s passion is to help todayâ€™s business leaders prepare for the challenges the emerging future is bringing.