Culture is critical to improving organizational performance. “Driving culture change” is ranked as one of the three top leadership development priorities, along with developing leaders to drive strategic change and filling gaps in the leadership pipeline, according to a February survey from Korn Ferry Hay Group that generated more than 7,500 responses in 107 countries.
No longer seen as an afterthought, culture has become the x-factor that holds the organization together and ultimately determines whether it succeeds in the market. Reaching future objectives for growth and profitability require senior leaders to define how the culture supports the organization’s strategy and to be consistent with its core mission and values. Once defined, a culture-change agenda should be embedded in individual leaders’ development plans and made part of all leadership activities.
Effective leadership development is holistic. It includes formal programs, such as structured learning, and informal activities, such as mentoring, global project teams and other activities that improve collaboration and enrich discussions. This mix of formal and informal learning is integral to make a desired culture shift because culture will shift as people change their behaviors.
To achieve cultural change, culture and business strategy must be aligned. The survey findings identified the following top three global drivers of culture change:
- 41 percent said improve organizational alignment and collaboration.
- 29 percent said improve organizational performance.
- 10 percent said address low employee morale/engagement.
But alignment between strategy and culture is often more the exception than the rule. In a 2014 Korn Ferry Hay Group global survey, 72 percent of executives said culture is extremely important for organizational performance, but only 32 percent said their culture aligns with their business strategy. This disconnect provides an impetus for organizational change.
The starting point to achieve a well-crafted strategy is to align the top team around the organization’s mission and purpose. Ideally, top leaders revisit original statements, align around a modern version, and define the leadership behaviors that support implementation and success. Then they communicate this information clearly, consistently and repeatedly as the top team cascades the new culture down through the organization, modeling the required behaviors.
Misalignment between culture and strategy can come from a lack of attention to culture in the executive suite, a lack of follow-through to culture-change initiatives, and failure to tackle pockets of resistance. Contextual leadership development working in tandem with culture change creation can help to correct things. Allow people to work on real business issues as they grow and learn. Programs should bring together leaders throughout the organization to work on strategy-related projects that support alignment and collaboration, and enhance the newly evolved culture.
Ultimately, culture change occurs when a critical mass of individuals adopt new behaviors consistent with the organization’s strategic direction. This is especially critical when influencing or mobilizing the informal subcultures that often drive the way people behave.
To enhance culture change, develop leaders and create greater alignment with business strategies:
- Involve top leadership. To help create buy-in and support, top leadership must assess the current culture and define the desired culture. Then, senior leaders must articulate the culture change and help employees understand the new culture, the reasons for it and why it is critical to achieve the organization’s goals.
- Change practices and processes. Evaluate everything the organization does against the new strategy and desired culture change. To sustain the desired change, hiring decisions, leadership development, and business processes and practices should change to reflect the new values.
- Embody culture in behavior and actions. Leaders should embody the new culture so employees understand how the culture looks and feels in the workplace. Compensation, rewards, and employee recognition also should be aligned to the new culture and strategy.
The work of promoting and reinforcing culture in an organization never stops. Leadership at all levels should live and breathe the culture, and serve as role models to the entire workforce. As organizational culture guru John Childress once said, “Organizations are shadows of their leaders.”
Dave Eaton is senior partner and practice leader for culture transformation at Korn Ferry Hay Group. Comment below or email editor@CLOmedia.comFiled under: StrategyTagged with: culture, leadership development, organizational performance