Changing Corporate Culture
Some things are easily changed; corporate culture is not one of them. After all, change upsets the status quo and is naturally resisted. Too often leaders neglect to sufficiently consider and deal with employee attitudes and feelings. A key competency of successful leaders is knowing how to lead employees through cultural change.
But cultural change CAN be accomplished with thoughtful preparation, transparency, active involvement, and open dialogue. It is all up to the change leaders.
What is Corporate Culture?
Think of corporate culture as what an organization stands for and how things truly get done. It includes the way people think, behave, and work. Changing an existing culture requires shifting the day-to-day behavior and mind-set of employees.
We believe that organizational cultures exist by design or by default. Regardless of their origin, some strong cultures can help companies perform (i.e. Southwest Airlines) and some strong cultures hurt performance (i.e. The Department of Veterans Affairs). As a leader, it is up to you to understand and shape your culture so that it aligns with and supports your strategy. Otherwise, you are not performing at your peak.
How to Accomplish Cultural Change Right
We approach cultural change in five stages:
- Set a Clear and Compelling Course
We believe that the same people who are responsible for setting the strategy are also responsible for setting the cultural norms to best execute the strategy. Setting the course includes assessing your current culture, agreeing upon your desired culture, and prioritizing the critical few cultural shifts required to better align your culture with your strategy.You will know you are headed in the right direction when top leaders agree upon how to ensure that your culture will help move your strategy forward in a way that makes sense.
- Articulate and Share the Rationale for Change
Before you can effectively lead employees through cultural change, those most affected by the changes must accept and buy into the “greater reason why” the changes are occurring in the first place. Leaders need to make a clear and compelling case for change. The earlier you can share the consistent and persuasive messaging with employees, the better.You will know you are headed in the right direction when stakeholders understand, can articulate, believe in, and agree with the key reasons for change.
- Actively Involve Stakeholders in the Change Process
Do not be fooled into thinking that powerful leaders can dictate culture change. You need active, committed, and involved employees for lasting change force to succeed. To achieve true corporate culture change, employees need to actively participate in the effort to transform the everyday behaviors, habits, and mindset that support a shift in the corporate culture.In fact, recent research by Bain found that the active engagement of stakeholders during the strategy design phase has the highest correlation to strategies being successfully implemented. We know that the same is true with culture change.
You will know you are headed in the right direction when stakeholders believe that they have a meaningful stake in the desired outcomes in way that works for them, their team, and the company as whole.
- Create Aligned Systems and Processes
Depending on the scope and type of cultural change, some training may be necessary to develop new capabilities. At the very least, leaders need to review resource allocation, performance management, and compensation systems to be sure they reinforce and incentivize the desired behaviors. And, of course, change leaders need to consistently and visibly model the desired changes.You will know you are headed in the right direction when those most affected by change believe that senior leaders and their direct manager are committed to making the change a success, supporting them during the change process, and providing the skills and knowledge necessary to be successful.
- Gather Feedback and Monitor Execution
Effective cultural change requires feedback, coaching, tracking and measurement. Use company-wide forums, one-on-one meetings with key stakeholders, team meetings, and anonymous pulse surveys to gather feedback and keep track of how the change is progressing.Also, watch indicators of organizational health such as employee attrition, absenteeism, and job performance. If needed, adjust the plan to accommodate unforeseen challenges to the success of the change.
You will know you are headed in the right direction when those most affected by change believe that their opinions count and that information about the changes are readily available to them.
The Bottom Line
Leading cultural change can feel daunting but there is a proven methodology for getting it right. It starts with a clear direction that is fueled by transparency and active involvement, and ends with monitoring and adjusting as circumstances change.
To learn more about how to lead employees through cultural change, download The 3 Research-Backed Levels of Culture to Get Right