A successful business satisfies customers and makes a profit. A successful organizational culture is a working environment that represents desired core values and a place where people want to work. But, using these standard definitions, there is almost no direct correlation between business results and organizational culture.
The Big Misunderstanding
A manager once said to me: “We used to have an awful culture. People blamed each other when mistakes were made, there was favoritism from leaders, low engagement from employees, people didn’t feel valued, and it was a punishing rather than learning-oriented culture. Every day was a struggle and felt like a battlefield coming to work.”
“That sounds awful,” I replied. “How is it today?”
“So much better.” He continued. “We brought in a training program that focused on values and we removed some of the most negative leaders. Today, people are kind to each other, more respectful of each other, and there is much more focus on employee development and engagement. Favoritism is gone, and people feel more valued.”
“And, what was the impact on your business?" I asked. “Would you consider your organization high-performing?”
The leader said, “Well, we are performing better than we did when we had a negative cultural environment, but I can’t say that we are high-performing!”
“How do you know that your business isn’t high-performing?” I continued to explore.
“We aren’t as profitable as we need to be, and our competition still gets higher customer satisfaction scores. We are improving through lean and agile process improvement, but it’s not having the significant impact we were hoping for.” He concluded.
Having a negative culture directly causes poor business results -- no question about it. And, while improving your culture to remove the negativity will initially improve business results, it won’t result in a high-performing business.
While you can improve processes, systems and technology, if your organizational culture isn’t directly linked to your business with optimal habits of thinking, behavior and a high level of emotional intelligence, there is no way your business can meet the demands of the increasing expectations of your customers, pressure from your competitors, changes demanded by the marketplace, and increasing regulatory requirements.
Six Steps To Directly Link Your Culture To Your Business
Step 1: Redefine your focus of culture from values to execution (behaviors). This is demonstrated by the collective habits at all levels and functions of your organization. What are your most effective collective habits, and what habits repeatedly cause breakdowns? Habits can represent patterns of thinking, responses to difficult situations, and actions taken, including accountability for results and improvement.
Step 2: Clarify your breakthrough business strategy and priorities. Identify those few initiatives that would take your business to a completely new level of success. This could include technology changes, acquisitions, new markets, new products or services, a new business model, or a dramatic reduction of operating expenses.
Step 3: Redefine expectations at different levels (not job positions) of your organization, from executive to individual contributor. Starting with individual contributors, answer the following question: If individual contributors were optimizing their execution in order to achieve those breakthrough strategies and priorities, how would they be showing up differently and sustainably in terms of engagement, teamwork, mindset, behaviors and attitude? How might their role expand from what it is today?
Then, describe their first-line manager in terms of how they would need to change their leadership approach to ensure individual contributors were developed to expand their role, mindset, behaviors and attitude.
Using this approach, there is a direct connection between the first-line manager and individual contributor that involves clear direction, expectations, coaching, monitoring and development. Of course, this continues for all levels of middle management and executive levels.
Step 4: Define 5 to 10 optimal team habits for all levels, functions and cross-functional groups. This is an engaged process to describe the optimal way the team would work together to produce the highest-performing results, given the constraints of their work environment. In this case, it’s best to start with executives, then form a group of upper middle managers as a unified or extended team, then move through each functional area. Developing habits uses a process of several competencies to fulfill a function, whether it’s sharing information, ensuring safety, making decisions, or solving problems, to name a few.
Step 5: Create a baseline measurement for each team habit. Using the same engagement process, each team will determine their current level of effectiveness for each team habit. However, developing a baseline measurement isn’t determined based on past performance. It is based on what is required to optimize achievement of the strategic initiatives and priorities.
Step 6: As a team, agree on the top one to three team habits for focused improvement. Based on both, which team habits are most critical for improving business results, and which will build stronger, more trusting relationships? Determine no more than three team habits for improvement and develop agreed-upon plans for making those improvements.
Step 7: Monitor and address challenges, and continue improving and reinforcing the new habits of behavior, attitude and action. Just as every top-performing athletic team, music group or dance company rehearses or practices their execution to drive their performance, have your team take some time during each meeting to work on fine-tuning the prioritized team habits.
Ultimately, when everyone at all levels is clear on agreed-upon expectations of behavior, teamwork and communication that is directly associated with the success of their priorities, people feel a sense of purpose, trust, camaraderie and celebration.
The Biggest Discovery
By focusing on execution, not only do business results improve but so too do employee satisfaction and retention. In fact, relationships throughout the organization improve because everyone is much clearer about expectations, support and what it means to operate in teams. It reduces silos and political behavior that result in frustration and disengagement. And, the biggest surprise is that the core values of the organization are demonstrated at a much higher level.
