There’s No Such Thing as a Culture Turnaround

Company culture changes very slowly, so efforts to do an about-face are inevitably a waste of time and energy: Organizations either declare victory prematurely or, in frustration, abandon the attempt.

You’re better off thinking of your cultural situation as an underpinning you’ll have to work with over time. It will evolve, but more slowly than other elements of your enterprise, such as a new operating model. You can shape your culture, however—and you can make better use of it by altering or adopting a few key behaviors.

That’s what one client of ours, a large industrial manufacturer, did to accelerate its recovery from severe financial distress during the recession. This example from the past is particularly instructive because we now have the distance to see how a few behavioral changes not only improved performance right away but also are having a longer-term impact on the company’s culture.

At the height of its troubles, this manufacturer was hamstrung by a risk-averse, slow-moving culture. At the time, the interim CEO assumed he wouldn’t be there long enough to “turn around” the culture—and in a sense, he was right. But we worked with his senior team to better understand the existing culture and to foster three key behaviors that would improve performance.

First, the management team started making significant, visible decisions—for instance, canceling a major product line expansion—in a matter of weeks instead of years. Next, several senior executives conducted small-group discussions with informal leaders in the organization about which cultural traits needed attention—something they’d rarely done in the past for fear of either wasting time or meddling outside their formal jurisdictions. They also put more in-house people in direct contact with customers more of the time.

Those adjustments have helped the company cultivate three traits—speed, risk-taking, and accountability to customers—deemed essential to its success.

All leaders can learn from this example: Target a few behaviors that will immediately energize the elements of your culture that are critical to moving your business forward. It is surprising how rapidly you can revitalize existing cultural traits if you concentrate on the right behaviors. Though it takes a bit of time and patience, viral spreading among informal leaders is a lot faster than programmatic spreading through redesign. Here’s what you do: 

1. Find a theme. Summarize, at a very high level, what you’re trying to accomplish. This is important because the critical behaviors manifest themselves differently, and you need coherence across groups and levels in the organization. In our example, the unifying theme for behavioral change was customer-centricity and responsiveness.

2. Don’t claim victory too soon. Because culture is always slowly evolving to fit strategic and operating priorities, it’s not an endpoint. Rather, what you’re ultimately aiming for is better business performance. And existing cultural forces can fuel the behaviors you’re trying to adopt in your organization. For example, legacy pride, engineering excellence, and design elegance helped energize and sustain newly identified key behaviors in the case of the industrial manufacturer. In other words, your organization’s culture is a fundamental source of energy that will help secure an emotional commitment from your employees, which is essential to making behavioral changes take root.

3. Enlist the help of informal leaders. Seek out the “influencers” in your organization, and ask them how they persuade, inspire, and mobilize their colleagues. They can tell you what works—and what doesn’t. They’ve learned through experience how to work with, not against, the underlying culture to garner support and make things happen. Business unit heads and HR can help you identify these informal leaders, but they aren’t very hard to spot. You’re looking for people who get things done in the organization. Learn from them; they know a lot more about the existing culture than you do, and more than any survey could uncover. Note that they aren’t necessarily your high potentials. They are authentic informal leaders who connect with people emotionally as well as rationally. In our example, what began as a smaller band of informal leaders became several groups of pride builders at the company. By treating these influencers as cultural advisers and tapping them for guidance, senior managers found ways to get more people across the company in direct contact with customers. As a result, customer satisfaction and sales numbers have improved.

4. Remember that cultural forces don’t go away. You can rekindle elements of a previous culture that produce feelings of pride, commitment, and collaboration, but you can’t kill an existing culture. And you shouldn’t try to. Just about every culture contains some elements you don’t want to lose.  Instead, work with your influencers to think about which behaviors you need, to articulate them, and to persuade people to embrace them.

5. Start now. Leaders often say they have other things to do first—then they’ll get to culture. Or they want to wait for new leadership, or a new governance structure. Do not wait. The time to understand your cultural situation is now. It will influence everything else you’re doing.

Culture That Drives Performance
An HBR Insight Center

Read Original Post from the Harvard Business Review


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