The Rise and Importance of Shaping Organizational Culture
High employee engagement has been the “holy grail” for talent development during the past few decades. Getting employee engagement right translates to higher productivity, employee retention, and many other intangibles for an organization. Get it wrong, and it becomes more difficult to hire the right people, keep them happy, and move the needle on the strategic imperatives for a company. However, with the rise of such companies as Google and Facebook, with their enviable campuses and perks, organizational culture has emerged as a bigger concern for companies, a major priority for both start-ups and big companies alike.
In fact, what is becoming clear is that a positive, thriving organizational culture most often translates into high engagement. However, targeting engagement while ignoring organizational culture can result in short-sighted solutions that do little to make real changes that employees care about.
But what is organizational culture, and how exactly can you change it? Therein lies the good news and the bad news. The good news is organizational culture is many things, and it’s everywhere; there are many things you can do to shape and evolve culture. The bad news is that culture can’t be forced, bought, or spun. It must be authentically shaped over time in a thoughtful way, and efforts to shape it are not always successful.
In the end, culture is not what leadership wants it to be; it is the actual experience and behaviors of the employees, from the CEO to the front lines collectively.
‘Let’s make this ad go viral’
Marketing teams roll their eyes every time a CEO looks at the advertising budget and says, “For the amount we are paying, why haven’t our ads gone viral?” It’s a picture of leadership wanting to be cool, but having absolutely no idea what it means to be cool. Competing with start-ups is difficult, and it seems that the organizational culture of the high-tech world is the envy of the lumbering big corporations that have been around for a long time.
The reality is that start-ups typically have cultures they shaped explicitly to compete as an innovative company, which means embracing management and leadership practices that are foreign to older companies. Maybe your organization aspires to be more innovative, maybe it doesn’t. Approaching the prospect of organizational culture change requires:
- defining and describing the organizational culture you need for now and the future to be successful and meet business challenges in a world of rapid and unpredictable transformation
- identifying the gaps and issues with your existing culture compared with the aspirational culture—what are the fundamental differences you’ll need to address?
- shaping and evolving the culture by infusing ongoing practices and programs across the organization (for example, communications, learning programs/onboarding, design of benefits/perks/real estate, and leadership programs).
Defining an aspirational culture
The first important question to ask is: What is the future demanding of us? Be clear about what has changed and will continue to change for your company. Do you need to become more innovative? More consistent in quality? More customer focused?
Even if the answer is to become more innovative, not every organization can or should be “like Google.” In fact, I’m willing to bet the best culture for your company is going to look wildly different from Google, though adopting some of the elements that differentiate Google, such as employee empowerment, might be necessary.
When you are clear about where you are going in the future, then re-examine existing organizational culture artifacts, such as your mission and values. Are they still relevant? Do they need to be updated? Are there other elements you may need to define?
The process of defining your mission, values, leadership attributes, and organizational purpose is an important exercise, one that requires consensus and input from leadership teams, internal communications, and HR and talent development. These elements, once defined, will not automatically change the organizational culture, but they serve as a strong signal to the organization that: We recognize the need to change, and here’s the direction we are heading.
It may be tempting to outsource some of this work to branding or design agencies, but most of this work should be done internally as a self-reflection exercise. In fact, the most powerful culture artifacts are typically the ones written by the co-founders of a company, or on the other end of the spectrum, sourced from the employees.
For example, Zappos publishes a culture book every year that consists of unedited letters written by employees about what they love about the Zappos culture and how they experience it. The language of culture artifacts should feel authentic, picking up nuances and phrases that are familiar and often repeated in the company. The temptation to use fancy or young-generation words should be avoided (unless this is truly reflective of your culture) because the most likely result will be the equivalent of organ rejection.
Culture artifacts are highly visible, carefully crafted communications that distill organizational culture and values into a digestible and easily referenced format. These culture artifacts are typically used both internally and externally to create transparency about the organization for employees, customers, and potential job candidates. Here are some great examples.
- The HubSpot Culture Code maintains an iterative slide deck (16 versions and counting) that outlines the kind of company HubSpot is working to create.
- Greenhouse publishes a blog to highlight aspects of its internal culture, including its Culture Credo and the company’s thought process and final design of parental leave and perks programs.
- The Virgin Group created a nonprofit entrepreneurial foundation, Virgin Unite, to highlight disruptive ideas in the people and entrepreneurial space and advocate for better ways of working and leading—a core principle for all of the Virgin businesses.
Recognizing culture gaps
The next major step is to do a thorough reckoning of the barriers, blockers, and practices that are working against your goals and aspirational culture. This is a tricky prospect because we often are blind to our own practices that are so ingrained in our mindsets.
Let’s say your goal is to become more customer-focused. How empowered are employees in your organization to “do the right thing” for a customer? Do they have a detailed script to follow in addressing customer issues? Do they have to seek permission to go off-script? Perhaps the rules, training, and permission mindset are working against you for truly addressing the needs of customers. Maybe you have the wrong employee profiles for the problems they are solving. The leadership style of your top leaders may be highly top-down, which is impeding the agency of employees to take initiative.
The exercise of identifying the culture gaps is something that will likely take time, unfolding in layers over the course of many years. This is also the most likely point of resistance in the process because many leaders will be reluctant to fix things that are not broken. Outside consultants may be helpful here; they are more able to point out blind spots in the organization. And if innovation, for example, is a priority, innovation firms will be able to guide the organization in understanding what this truly means and what changes will be necessary to support it.
Systematically, you will need to work with leaders to assess all of the elements of organizational culture, which are outlined in the ATD Talent Management Handbook:
- Products and style—Is the design of your products or services in line with your aspirations?
- Colleagues—Do you have the right skills and leadership attributes to lead the changes you need to make? Are you hiring individuals who will bring valuable perspective and capabilities to help shape your culture?
- Workplace vibe—Does your physical space and virtual tools support the needs for collaboration, agility, and transparency?
- Communications—Does the tone, frequency, and content in communications match the aspirational culture? Do employees have a voice in the company to help shape this?
- Agency vs. process—Are employees empowered to take initiative, test new ideas, and make changes to outdated processes, or are they encumbered with rules and approvals that stymie change?
- Rewards and growth—Are you rewarding the behavior and results you want to see, or are you stuck with old models that reward outdated behaviors and results? Consider both formal rewards, such as compensation, and informal components, such as the types of leaders you are promoting into high-profile positions, which can implicitly say volumes about what the organization values.
- Generosity—Do employees feel a real sense of generosity from the company, that they are valued as individuals and important to the success of the organization? If employees feel like anonymous cogs in the wheel, and leaders tend to exploit employees to maximize productivity without ensuring that employees can manage their own energy sustainably, they are going to be unwilling to join you in the quest to shape a positive organizational culture.
Get to work
Once you have a clear sense of the gaps in where you need to be with your culture, under no circumstances should you try to change them all at once. This final phase takes focus, persistence, patience, humility, and above all, time.
Start by being transparent to the entire organization about the gaps. Be humble in sharing the truth about where things need to change and why. The simple act of laying this out sends a strong signal that the organization is serious and realistic about what it will take to make things different.
Next, create channels to solicit feedback at all levels of the organization. What can we do to make the changes? How would you do things differently? Where should we start? These channels create a collective invitation to the company that everyone should play a part. In addition, these channels will be useful for assessing progress on what is changing and where things are still stuck in the old ways.
Finally, prioritize the redesign of talent development programs to support the organization changes. Some quick wins include:
- infusing the organizational culture statements and artifacts in onboarding and development programs
- creating a clear set of talent needs to prioritize in recruiting, including assessment for culture fit
- branding your talent development programs to align with the aspirational culture, from program names to communications, to visual design elements.
Longer term, you’ll need to revisit the whole spectrum of talent development programs you have in place and consider modifications or even a complete redesign of processes. For example, performance management processes are increasingly a point of misalignment for companies as they recognize the once-yearly, heavy processes are incompatible with the need to become more agile. The trend to simplify the process while adding more value through development conversations is a good example of shifting organizational culture through more authentic and frequent feedback.
Leadership, manager, and individual development programs are huge levers for shifting mindsets and changing work practices toward greater empowerment, innovation, and agility. The programs should create and reinforce a new vocabulary and give the organization concrete tools and frameworks to help each individual understand: When I walk in the door tomorrow, what will I do differently? A common vocabulary is a powerful rallying point that can create momentum toward change.
You also will likely need to revisit your rewards, benefits, and perks to take a holistic view in offering a set of options that align with the profile of your employee population and support the type of culture you are looking to shape. Looking to create a bit more spontaneity and fun in your company? Ping-pong tables might just be the thing. Wanting to inspire employees to create more beautiful products? Memberships to local museums might be an appropriate perk to consider offering. Perks and benefits shouldn’t be offered to compete with other companies; they should reflect the kind of company you want to be and effectively support employees to sustainably integrate their personal and work lives.
Role of the chief talent development officer
What role do you play in shaping organizational culture? The bottom line is that organizational culture comes down to the people—who they are, how they behave, and what they experience. While the development of products and the build-out of the offices most certainly play a role in shaping culture, the people component is arguably the largest and most difficult piece to get right.
The chief talent development officer has the best view and the largest number of levers to pull in making the changes that ultimately will have the best chances for success. However, shaping organizational culture cannot be “owned” by the CTDO, nor the CEO for that matter. Note that this requires consensus building and collective shaping from every corner of the organization.
However, the CTDO can serve as the driver for initiatives and can help assess progress over time, linking together the many disparate efforts across the organization in a holistic way.
How do you know when your organizational culture shifts are taking place? For starters, employee engagement and similar surveys can provide some evidence of shifts occurring in the organization. Remember, however, that employee engagement is a symptom, not a driver of organizational culture. Thus, over-focusing on these surveys can be a trap for improving individual survey items versus fundamentally changing the culture.
The more powerful indicators are the words and actions of employees. When asked about the culture, do their descriptions line up with the aspirational culture or do you get wildly different answers and views? While you would expect some variation, the hope is that common themes become more pronounced over time.
Maintaining a qualitative list of anecdotes, positive changes, and examples of culture shifts is a powerful action that can create momentum and excitement. Better yet, set up a feedback mechanism to collectively source examples of positive change across the organization.
The ultimate sign of success is a rise in job candidates citing aspects of your culture that excite them. This is when you know you’ve truly created a viral culture that people want to join.
This post originally ran on the ATD blog, and is republished here with our thanks.