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Fundamentals of OE #9: Getting the Culture Right

Summary

  • Culture can be one of the greatest competitive advantages for any company, helping it stay ahead even if product, process or talent-based advantages diminish
  • Operationally Excellent companies treat culture as an ongoing effort to be monitored and nurtured
  • Culture is more than values, and changing culture takes more than posters and pep talks

Culture seems to be one of the trendiest buzzwords. Following high profile incidents in nearly every industry, culture has been elevated to priority status for many senior leaders. A 2017 report by the Business Transformation & Operational Excellence World Summit revealed that “improving company culture” was the most critical challenge facing operational excellence practitioners for the last 2 years. 

The most common justification for focusing on culture is for avoiding incidents, but the stronger reason is as a competitive advantage. Your culture can be the strongest competitive advantage you have. It can magnify your return on investment in talent and technology, and it can compensate for shortcomings in your processes. It can make you more reactive and adaptive to change. It is well known that diversity breeds innovation and progress, but your culture will dictate the extent to which the ideas and opportunities that diversity provides are allowed to flourish or be extinguished.  

Operational Excellence depends on a healthy, cohesive culture. The question isn’t why, but how.

 

 

Getting your culture on the right track

Despite the popularity of culture improvement initiatives, many companies still struggle with making any real progress. Not to oversimplify the challenge, there are four primary steps on this journey that we want to highlight because they are where most companies struggle.  

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1. Define the Desired Culture 

 Culture change cannot begin without defining your target. What do you want your culture to be? The tricky part is defining it in a meaningful way. These are two best practices for improving how it’s defined.  

 First, define the culture by observable behaviors rather than desired outcomes or goals. For instance, some companies use their corporate values to define their culture. Values inevitable contain “things” or “outcomes” that are important but difficult to consistently translate into behaviors. Whether you use your values or something else to define your culture, you need to go a step beyond the “what” you want to do and define the “how”. 

The second is make the definition short enough so it’s easily remembered and applied in the moment where you want it to influence how employees behave. If you have a list of 20+ values or characteristics, your employees won’t remember them all. Highly effective cultures can be narrowed down to a handful of characteristics that apply to every employee to guide their behavior. 

 

 2. Translate and Communicate  

Culture will never be changed through a few posters on the wall and leaders mentioning its importance at town halls. Culture is reinforced or changed in every interaction between the individuals that make up the culture. To change the culture, you need to take your definition for desired culture, then translate and communicate it to each employee. Show them how the desired culture manifests in their normal day-to-day actions.

3. Treat Culture as an Ongoing Effort 

This is perhaps the area with the most opportunity. Culture change efforts take time, and they are difficult. If culture change is driven by the temporary momentum following an incident, that momentum will always run out before permanent change occurs. 

Commit to culture change by making cultural improvement an ongoing part of running the business. Build on the desired culture by incorporating cultural measures into your interviewing and onboarding practices. Reinforce the culture by embedding the desired culture into individual performance assessments. Periodically measure the culture through objective tests. Forget employee engagement surveys – they are unreliable measures of culture. Engagement surveys primarily measure how satisfied and happy your employees are, so keep in mind that culture change will initially challenge many of your employees and make them uncomfortable.  

 

4. Exemplify the Culture 

This should go without saying, yet it remains a critical opportunity. The most important factor for changing culture is leadership examples. If leaders are measured and rewarded on a biased scale, culture “change” will never happen. The important thing to realize with this is that every employee can play a leadership role to someone else, every employee can lead by example. This means any employee has the capacity to kick-start a culture change. You don’t need to wait for a corporate initiative for funding, or for everyone to get on the same page. Start with your circle of influence and go from there.

Where to begin

Culture change is hard, but it isn’t complicated. It doesn’t require sophisticated technology or a highly coordinated plan. With a clear direction, patience and persistence, any company can change transform its culture. Creating a cohesive culture begins with understanding the current culture and level of misalignment. The best way to do this is through an objective assessment to evaluate where, how and to what degree any misalignment exists.  

For the best results, seek out a comprehensive assessment that: 

  • Measures the culture across different levels and locations 
  • Isolates cultural factors from outcomes like collaboration, innovation or engagement which depend on multiple variables beyond culture 
  • Comprehensively evaluates both the culture along with the ecosystem that rewards and reinforces the culture 

Our culTRUE™ is a great place to start. Call us to find out more.

 

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Next Post:          “Fundamentals of OE #10: Don’t Lose Sight of the Bigger Picture”

This post is an excerpt from the white paper “The Fundamentals for Transforming Your Organization Through Operational Excellence.” Download the complete white paper here.

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Business Transformation, Cultural Transformation, Energy and Industrials, Operating Effectively, Operational Effectiveness, Transformational Strategy

Francisco Soto Director

Francisco Soto is a thought leader in the operational excellence space. He specializes in simplifying how his clients maximize the value of their strategy through a...

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