Determines how your people will respond to a change initiative
Organisational culture is more important than you may realise.
This is a subject that I find tends to get a somewhat polarised reaction whenever I discuss it with directors.
There is either a polite indifference and "...well let's get on with discussing the practical aspects of how we're going to do this?" type of response; or considerable interest then the question: "How can we actually deal with it and change it?".
In both cases there is the feeling that culture is a "soft" intangible subject that is difficult to discuss in specific terms, and in the first response the belief that because we can't see it or really get a handle on it then it's irrelevant.
Can I challenge you now... as you are reading this... how do you feel about the culture(s) of your organisation?
Do you feel that it's an important aspect of your step change initiative - or to be truthful, do you feel that whilst it's an interesting abstraction it's not really THAT big a deal?
In this section I want to explain to you how I discovered organisational culture and its significance in my business life; why this area is so important and to show you how to address it in your own organisation.
Restated and put very bluntly - you cannot make a successful step change [and realise the benefits] without changing your organisational cultures.
How I first became aware of organisational culture and its significance
I first became aware of the significance and importance of organisational culture in 1994. I was involved in a business development exercise with a colleague and we were trying to figure out how to promote our consultancy business.
We both had a strong business-to-business direct marketing background and many years of successful corporate sales experience.
We had also worked with and for approximately 150 companies between us over the preceding 15 years.
But we were running into a "brick wall" with our business development efforts. The specific issue was this:
"How was it that we could approach 2 companies that outwardly seemed very similar in terms of size, industry sector, age, profitability and a range of other segmentation factors - and with the same carefully targeted sales message - and yet get 2 totally different responses?"
One evening, I was flicking through "The Marketing Manager's Yearbook" looking at various prospect companies that we both knew very well, and I started paying attention to the detail provided about the type of sales and marketing personnel employed and specifically their job titles.
To set this in context, this was at the time when business-to-business direct marketing, databases, call centres and all the associated technologies were all very embryonic and taking off fast in a post recession UK. This was also the time when Business Process Re-Engineering was very popular.
I noticed in the Yearbook that the entries for 4 seemingly similar companies [in terms of traditional marketing segmentation] were very different. Company A had a Sales Director but no marketing personnel; Company B had a Sales Director and a Marketing Director; and Company C had a Sales Director, a Marketing Director and a Direct Marketing Manager, and Company D was the same as Company C except that it had a Database Manager as well.
The significance of this observation was that each additional job title was indicative of a different organisational culture - and the response we got from companies and their degree of receptivity to our sales messages was all to do with how well our sales messages were aligned with that particular company's culture.
I quickly cross referenced many client and prospect companies and analysed them in the same way and found that this initial hypothesis stacked up.
And so the significance of organisational culture - initially seen solely from a business development perspective - became firmly established on our radar.
My own view is that whilst we can get overly distracted with models - they do serve as a useful form of "short hand" in articulating the position of an organisation in relation to a specific area of learning, insight or understanding.
I am showing this early model because it is an excellent illustration of how the characteristics of an organisational culture are identified and summarised.
This template has been used on many companies and in many, many different situations over the years - overtly [with client involvement] and covertly [i.e. I use it but don't involve my client as it may not be relevant or they may not be receptive.]
How to identify and unpack an organisational culture and sub-culture
With reference to the Template of a Culture Map shown in the link above:
(1) Culture Type
The dominant organisational culture can be unpacked in terms of:
The historical culture - where you have come from e.g. an old family owned business
Where the company is now e.g. an MBO 2 years ago
Where the directors think the company is now e.g. vibrant and customer responsive etc
Where the company actually is - this will be an independent third party perspective - and may show that actually the company is not customer responsive and is very inward looking
The distinctions between these different perspectives of the dominant culture are very important because they represent potentially significant gaps in perception that either are or will be the cause of issues in a step change scenario.
Other factors here are the size of the company and the extent of change experienced within its relatively recent history - so the larger the company and / or the greater the amount of recent change - then there is a greater likelihood that these gaps in perception will be present.
There can also be 2 different types of subculture - those that are:
In step with or even ahead of the dominant culture, and those that are
Resistant to the dominant culture.
In both cases, the people concerned may either be aware and conscious of how they are and what they are doing or unaware and unconscious.
There may well be other types of sub culture present. The purpose of the template is to stimulate awareness of the possible existence of these entities within your organisation.
A sub culture can exist within an entity as small as 2 or 3 people or a much larger group such as a whole department, or anything in between. It usually evolves around and is focused on a specific function such a sales or accounts and /or a strong personality or dominant individual.
The importance of the sub culture is that reflects what the people within it really believe and their usually un-spoken attitudes and values - all of which are displayed in their behaviour and actions.
Rewards/Incentives Financial? Non-financial? Do rewards match required behaviour?
Controls /Measurements - How are outcomes measured & monitored?
Communications - Who? What? When? How? Why?
Environment - Working routines? Style and atmosphere? Myths and legends?
(4) Key Issues Actions and Behaviours
Observable behaviours and actions that provide evidence of the key issues that result from this culture e.g. in a production culture these might be a cost control and quality related.
Observable behaviours and actions that demonstrate the real agendas of the key players in this entity (as reflected in its culture) - these will be highly subjective and relate entirely to the individuals concerned.
(5) Major Areas of Focus - Areas of Impact
These can identified by:
Major areas of impact arising from the key issues
Those things that receive the greatest focus in this culture e.g. in a production culture the major focus will be on doing whatever it takes to satisfy existing customers, developing and maintaining distribution relationships, understanding wider market factors and their impact on production processes.
This template is not exhaustive nor is it meant to be difficult - it was designed to be [and has proven itself to be] a very useful guide to identifying and unpacking the differing cultures and sub cultures that comprise an overall organisational culture.
Check out this excellent report on cultures and their significance in change initiatives from Neil Farmer of Informal Networks Ltd. Neil has led teams on 5 major successful change initiatives.
The reason why understanding your cultures is so important is that they are the single biggest determinant of how people in your organisation will behave - and especially in the context of a step change.
How to do all this in practise
Ignore it - that's your prerogative - but you are ignoring a massive element of what needs to be addressed to increase your chances of success.
Get me to do it and tell me not to bother you with how I've done it [I can't tell you how many times I've done this!] This option will at least ensure that you "get there" - but you won't know how and you won't be able to do it again when I've gone.
Directors only do it - this can be a very valid exercise - especially the first time round - then "roll it out" with wider participation.
Directors and selected senior management - as above a very good way to start out.
Everyone involved does it - ultimately it is extremely beneficial to involve all those affected by the step change with at least some aspects of this - to validate the authenticity of the exercise - as outlined above - and as an intial part of involving them in the process of step change.
What I have outlined above in this section is the key to understanding and getting the best out of the Pre Programme Review and Planning Process.