1. Clarifying values but more importantly explaining the reasons for them, how they connect to the organisation’s purpose to performance.
2. Correlating values to behaviours – what actions represent the values – and the more unique, identifiable even outlandish the better.
3. Are the leaders living the values, are there champions across all levels of the organisation that base decisions on values; and finally, do people see themselves as custodians of the values and call each other out when they are not lived.
How do you change the culture of an organisation? Is it even possible?
We often get asked these questions in the work we do in organisational transformation through performing teams.
Yes, cultural change is possible, but harder than many think, comes at a high cost, and requires more commitment than most are willing to afford.
Turning to our first principles: Results require disciplined effort – a cost, a price to be paid, upfront, and at least proportionate to the desired outcome.
For those rare organisations willing to pay this high cost, the good news is that the results will make it all worthwhile.
How did we get here?
Bad culture, like obesity, does not materialise overnight.
It atrophies over time.
It results from organisations and people prioritising their ‘what’ even their ‘why’ over their HOW!
Too much of a singular focus on results at the expense of all else.
We have been arguing for over a decade about the importance of the ‘pursuit of goodness’ in how things get done.
Considering conscience when measuring performance.
When leaders turn a blind eye to ‘true north’ principles, toxicity, like rust, slowly builds and grows, eventually destroying organisations.
The need for change
The realisation that change is required usually occurs over a severe incident or tipping point. It often takes a heart attack for someone to realise they’ve been ignoring their health and dismissing less fatal but clear warning signs such as shortness of breath for too long.
Then even the most cursory glance reveals the need for change. That the status quo is at best not ideal, inefficient or sub-optimal and at worst toxic,￼ dangerous, unsafe, even illegal. That what were repeatedly dismissed or ignored as aberrations were in fact lucid indicators of cultural malaise. And that change is imperative.
Regrettably, culture cannot be changed in one fell swoop.
Just as much as atrophy takes time so does convalescence.
Culture is a result of lived values – embedded behaviours – over time. The critical factors are behaviours and time.
In addition to these, there are three critical imperatives:
1. Clear Values and Reasons – Why
2. Unique and Identifiable behaviours – What
3. Lived, Championed and Distributed Ownership – Who
1. CLEAR VALUES AND REASONS
The actions, behaviours and habits of individuals stem from their values. An organisation that wants to have a strong culture must first clearly articulate what its aspirational values are and most importantly the reasons for it.
In our work with a fledgling sporting franchise that required a turn-around our first step after redefining purpose was to clarify its values.
What should our identity be if we are to fulfil our mission?
We realised quickly that there was a gaping vacuum for sporting role models in the environment and one that could be effectively filled by repositioning the club in society.
To achieve this, however, there needed to be a shift in focus from simply ‘winning a championship’ to being positive role models.
The ensuing consensus was for values such as:
◦ Good Manners
The values were clear and easily remembered but critically their reasons were explained and understood.
It served as the conduit that connected Purpose, People and Performance.
Only when everyone understands why an organisation stands for something will they be motivated to do so themselves – to make the personal and daily sacrifices required.
2. UNIQUE AND IDENTIFIABLE BEHAVIOURS
Values on their own can be abstruse. Intangible. Ambiguous. They can end up being little more than a motherhood statement in the annual report or on the organisation’s website or even the boardroom wall.
For values to have value they must be linked to corresponding behaviours.
And the more unique and identifiable the behaviours the more likely they are to be taken up.
In the example cited above, we created a set of behaviours that not only correlated to the values but were unique, even outlandish.
◦ No swearing – good manners
◦ No wearing headphones in public – inspirational
◦ 250 school and community visits per athlete – selflessness
◦ Meticulous, extensive and extravagant fan engagement – entertaining
◦ Zero-tolerance policy on bad behaviour – inspirational
The more unusual the aspired behaviours are the easier they are to be identifiable and managed.
Silicon venture capitalist Ben Horowitz in his book ‘What you do is who you are’ emphasises the power of culture as a key driver of business success and goes on to argue that the most powerful cultures are built around rituals and practices that are so memorable and so bizarre that some would even consider ‘shocking rules’.
3. LIVED, CHAMPIONED AND DISTRIBUTED OWNERSHIP
The final imperative for cultural change is for the values and behaviours to be lived, championed and universally owned.
“How does the boss expect me to live by the organisation’s values when he doesn’t do it himself?” This is a question we often get from the front line.
Put simply, it’s impossible.
Culture is the result of the values lived, tolerated and encouraged by the leadership – both good and bad.
Regardless of whether they reflect what’s on the organisation’s website or marketing collateral.
Leaders must practice what they preach. Or as the old adage goes: lead by example.
In two organisations where we introduced a ‘no-swearing’ policy, we had to have buy-in from the leadership/ownership – specifically, high-wealth individuals. It is heartening to note that on both occasions, not only did we have their full support – they lived those behaviours when in the organisation.
The behaviours a leader ‘walks by’ are the behaviours s/he promotes.
It is unacceptable for a leader to turn a blind eye to bad behaviour or to say “I don’t want to know about it”.
If there is one area a leader is allowed to micro-manage, it is how the values and behaviours are lived.
There will be mistakes, difficulty with breaking bad habits, reversion to past ways, lapses in judgement and the like. When these occur, and they most certainly will, they must be acknowledged, owned and rectified.
Cultural change in an organisation requires champions across all levels who actively promote, promulgate and proselytise the new values and behaviours. Converting as many as possible into new believers.
Every decision must be considered in light of the values.
– Do we exit our best salesperson because of his behaviour and take a hit on revenues? Or do we put up with it to meet our forecasts?
– Does this new player fit our culture? If he doesn’t, do we make the tough decision of not signing him, regardless of how good he is?
– Do we drop our current provider knowing full well that their supply chain is compromised or do we keep them for their low prices?
Championing cultural change requires conscientious decision-making at every stage against the aspirational values, explaining the tough decisions so that everyone in the organisation shares in the new journey.
A sporting franchise may say – Yes, we have walked away from our gambling partner and, no, we will not take on an alcohol sponsor – because we know the harm their promotion may cause our target audience. This will mean less income, perhaps even smaller pay rises, we’ll have to find replacement partners – but we are true to our values.
If the values have a strong enough ‘why’, and the associated behaviours are easily identifiable, lived, and championed – ongoing distributed ownership is the final imperative.
This means not only living the values but holding each other accountable for them and the organisational commitment to change. Everyone shares custodianship!
“We don’t do that around here” is a catch cry that must be heard at the water cooler, the board room, the locker room, on-site, on-court and in private conversations.
» Communication and candour are vital for cultural change – where no one is above being called out and where antithetical actions are discouraged and interdicted.
» Distributed ownership also means recognising and rewarding behaviours that align with the values. Acknowledging and touting examples of good actions can be very powerful.
» Finally, distributed ownership is about paying attention to the little things. Whilst big rocks are quite visible, a million grains of sand can weigh a lot more and be easily overlooked. With culture, it is the first straw that breaks the camel’s back. It takes vigilance to find and eradicate the early onset.
Establishing and maintaining good culture is not easy – which is why so few organisations get it right for any length of time. In recent years in Australia we have seen lapses in the banking industry, mining industry and the telecommunication industry. Even management consulting firms have failed the goodness test.
Our one-dimensional pursuit of ‘success’ or the what, has come at the expense of our conscience, the how.
Yet, how we live our lives is always more important than what we achieve.
For we will all be remembered – the question is HOW!
RIO TINTO: 24FEB2022 – Highest ever profit – $US21.1 billion profit for 2021 ┊ Rio – Everyday Respect Report – Nearly 40% of Rio’s male First Nations employees said they had experienced bigotry and intolerance while at work…nearly 30% women and about 7% of men have experienced sexual harassment at work.