Corporate culture can make or break your organization
How creating a dynamic culture of engagement (“We” culture) allows for change from within.
Cultural transformation starts with executives and management teams being willing to embark on a personal development journey – or in the words of French novelist Marcel Proust: The real voyage of discovery consists not in seeking new lands, but in seeing with new eyes.
Case study: Manufacturing company – Mission: Developing a values-based culture
Situation: Despite respective efforts, no progress is being made
A manufacturing company with 6 locations in Germany had big plans to adapt their policies and procedures to overcome new market challenges, including increasing efficiency by implementing new production facilities and making existing production facilities competitive by establishing modern ways of working (kaizen).
Even though clear goals had been agreed upon and employees had been trained on using the principles of kaizen, there was no real willingness to change. Management meetings were characterized by a silo mentality, or as one manager stated: “We keep making the same points without making any progress.” There was little awareness of managing processes across different locations among members of the management team.
As a result of several company mergers, various production sites were merged into one organization – with very different team cultures. Not only were the team cultures different, but it also turned out that there was a strong rivalry between the older and less modern production sites and the modern facility.
Everyone in the management team was committed; however, they felt like a hamster on a wheel – there was a lot of activity, but no progress. The fact that the relationship between team members was rather formal didn’t make the situation easier either. Previous efforts by individual executives to motivate employees to adopt the new way of working were considered additional pressure and met with suspicion and even opposition. While the management team was intellectually aware of the importance of the factors for values-driven leadership, they were unable to implement them in a tangible way into day-to-day operations.
An employee survey revealed that there was considerable discontent among the staff. The entire management team was aware of the fact that they won’t be able to make any progress this way. But where to start?
Start of the consulting process
The consulting process soon led to the hypothesis that the organization neither had a clear, motivating vision nor a common understanding of what it meant to work in a team spread across different locations. To address this issue, we proposed a project setup which would involve the entire organization.
Fig. 1: From diagnostic to implementation to reflection on the implementation
Preparatory phase: Laying the foundation
Before we don’t know where we stand today we cannot make any reasonable plans for the future. Previous guidelines and concepts of the management were left in a vacuum and, at best, caused them to stumble in the right direction, once in a while. To be able to initiate a new start which was going to be supported by each staff member, it was inevitable to have an honest discussion on the current situation. It was not sufficient to only look at the measurable level of behavior in this context. Instead, it was necessary to explore the opposition to change and the currently existing distrust by examining the role of values, feelings and needs of the employees and different locations. Performance equals potential minus measurable and perceived disruptions. In our case, despite high potential, the performance had been way too low.
Fig. 2: Management teams at the various locations have a different perception of the overall organization, and there is no shared, clear and motivating vision for the future.
Target: Achieving strong buy-in
From the very beginning, we aimed at ensuring strong buy-in from the management, staff, locations and works council. For this purpose, representatives of the four divisions appointed change agents who, along with executives, were supposed to also continue the implementation of changes on their own later on. We developed a multi-tier transformation process consisting of workshops that were followed by implementation phases which were evaluated in a follow-up workshop and adjusted accordingly for the subsequent implementation phase. Continuous feedback loops relying on hands-on experience were created this way.
Diagnostic phase: What corporate/team culture do we have today?
At the beginning, the most important goal was to get the entire staff interested in the cultural transformation and encourage them to approach new concepts with an open mind. For this purpose, the internal change agents, with our assistance, analyzed the cultural climate by using quantitative as well as qualitative research techniques:
1. Quantitative: Online survey of all employees on their attitudes/mindsets and values (10 most important values each)
- Which values describe you as a person? (who you are and not who you would like to be)
- The way we work together today is determined by what?
- What should we focus on in order to be successful?
2. Qualitative:Change agents do in-depth interviews and use focus groups to find out what employees think.
A.) One-on-one interviews
The one-on-one interviews were designed to develop a deeper understanding of the attitudes/mindsets of the staff and to gather their ideas on how to improve processes. They also served to find out what employees think about the cultural transformation and to get an idea of what could make them curious.
The interview results were documented in a report.
B.) Focus groups
Focus groups were set up to gain an understanding of what employees from different divisions and walks of life think about the cultural transformation. The collaging method, which serves as a catalyst for discussions, was used in this context to help participants start a conversation. In the moderated discussion, participants were asked to describe the current situation as well as the desired state, using a combination of words and pictures. In the subsequent plenary discussion, participants talked about key issues of the resulting picture and about their ideas on how to achieve the goal of a “We” culture.
The results were clear and lay the foundation for a collective “We”.
Fig. 3: Measuring the gap between personal, present and future corporate values. The most frequently mentioned values are listed first. Measurement was based on the Culture Values Assessment (CVA) by Richard Barrett.
The respondents all agreed that they were not happy with the current situation. However, they indicated a willingness to help shape the transformation process, provided that the management was committed to transparency and honesty.
In the online survey on values and attitudes/mindsets, “honesty” ranked very high for the personal values as well as for the values desired for the corporate culture; however, it didn’t appear at all in the currently experienced organizational culture. The result was clear: from bureaucracy to chaos to short-term silo mentality and cost pressure – the entropy, i.e. the degree of frustration over the corporate culture, was very high.
Conclusion: The discussion about the underlying attitudes/mindsets was difficult at first; however, without out it, no progress would have been possible. Being provided with an understanding of the current situation and clarity on the values, the organization was ready to plan the next steps. The analysis of the present cultural climate within the organization also led to an open exchange between employees and executives, and they began to realize that they were all in the same boat and were going to sink or swim together. They also realized that change was inevitable to even find a commonly accepted course.
Forum 1 – Defining a common approach
Within the context of a moderated process, the extended management team used the findings of the study to draw a conclusion from the overall picture they had obtained. None of the participants were surprised about the huge gap between the current situation and the desired state!
A large majority of the participants appreciated the fact that the issue was finally addressed.
The diagnostic results called for a large step forward, which also called for all executives to be willing to learn and to get on board of the development journey to identify individual drivers and non-obvious motivation, and thus question their own actions.
They soon realized that they do not have to accept the situation as it is but that they have the ability to do something about it, and so they came up with a first concept for the future: individual measures which should make the desired values tangible were bundled in key topics. – How can we translate the most important values into tangible actions?
The executives reflected on their personal impact and discussed how they could support each other to communicate more effectively and eventually “pull in the same direction”.
Implementation at production sites: Your attitude is crucial
Taking a step back and reflecting on and questioning previous actions showed that talking about values and attitudes/mindsets was crucial to get an idea of how to transform the present culture. But before starting the implementation process, all employees of the individual locations had to be engaged.
Honesty was the second most frequently indicated personal and desired corporate value.
Based on their new understanding, executives now adopted a different approach and discussed the results of the employee survey and focus groups openly, resulting in an honest exchange in an open learning atmosphere. The first management tools (check-in) were introduced in production teams and in the management team. Employees were engaged in the discussion on how to best implement the kaizen measures.
- Together with the management team of the respective location, the overall results were presented, reflected on and discussed at each location.
- Quick wins, i.e., measures which can soon be experienced at individual and team level, were implemented immediately. For instance, from then on, an important task of the management team was to discuss diagnostic and discussion results with employees in an open format.
- Long-term improvements which required a longer planning period, such as the optimization of shift plans, were also initiated and scheduled.
At the end of the process, many participants had realized that their inner attitude towards their colleagues and team and the way they talk to each other was crucial for success.
Forum 2 – Sharing success stories. How can I proactively manage cultural transformation?
Inspired by their conversations with employees, the extended management team met again to discuss first results and to make sure the cultural journey was going in the right direction and change the course, if necessary.
The need for change was articulated by describing the current situation as well as the desired state, taking account of the result, behavior and attitude/mindset. It resulted in the development of concrete actions of the management team to solve the most important problems.
Fig. 4: A collectively developed description of the cultural journey strengthens the inner focus of all participants. Based on the individual pictures of what the current situation is and what the desired state would be, transformation processes were specified for the individual divisions at the respective location and concrete measures were defined.
Implementation is a matter of hearts and minds: building and maintaining relationships as well as making sure that the actions taken are useful are recognized as important management tasks.
The initial experiences gained on the learning journey and the feedback provided by employees clearly showed why it had been impossible to implement any concepts in the past. As long as the employees were not on board, it didn’t make much sense to set sail. The management team recognized that they would have to encourage everyone to get on board in the future, which required:
- Continuous work at the relationship level
- Regular review of the perspective on current and future, long-term usefulness
Prior to our intervention, there had been a tendency to not address conflicts directly, which resulted in the fact that some conflicts had simmered under the surface for a very long time. Now being aware of the fact that honesty was a major value of the overall organization also meant that conflicts would be addressed proactively instead of taking a wait-and-see approach and hoping that they will resolve themselves.
Before we addressed the issue of how to deal with conflicts and provided exercises on “difficult conversations“, we asked participants once again to embark on a personal journey to discover individual motivation, protective and defensive instincts and the underlying human needs. The journey was designed to identify the root causes for the lack of action, thus enabling participants to take responsibility for their behavior/actions. From the negative attitude of “I am forced to do something and need to defend myself” to a positive attitude of “I play an active role in the transformation”.
After people’s awareness of their own attitudes and motivation had been raised, concrete measures could be scheduled and trained respectively:
- Doing exercises on how to deliver feedback in a way that communicates the message of “I see you, you matter, and the effort you put into your job is appreciated”, and doing exercises on how to approach difficult conversations.
- Doing a check-in at the beginning of meetings to raise awareness of what’s on the other’s mind.
The check-in allows each member of the team to share their personal opinions/feelings with the other members of the team. The other team members listen carefully. No comments will be made.
Depending on the situation, various questions can be asked for the purpose of a check-in, for instance:
- How are you doing (in the team)?
- What should we do to make some progress?
- What should we focus on?
- How do you experience the way we work together?
- What achievement of the last week are you proud of?
- What topics are currently on your mind?
- What makes you upset?
- Where do you need support?
- Developing measures to bridge the gap between desired and currently existing values and attitudes/mindsets. A lot of things could now be realized in an unbureaucratic way as a result of coordination across departments:
- Agreements between departments, also across locations.
- Consultation on what kind of reporting is reasonable and when.
- Instead of sending e-mails back and forth and ducking responsibility, you just drop by the other department or call to clarify an issue.
At the management level, dealing with issues in a transparent way resulted in the fact that executives now address and consult with colleagues to get their input when they are facing any leadership challenges. People who used to be considered a disturbing factor in one’s own process are now seen as a valuable source of advice. Competitive thinking and silo mentality are replaced by a collective approach. The management team starts to see itself as ONE management team across individual locations.
One important milestone of the learning journey thus was achieved. The preparatory work had now been completed and it was time to talk about how to implement the kaizen methodology into day-to-day work.
Next steps – Embedding cultural change
Several other small and medium-sized concepts that had been shelved in the past were now implemented without further ado. In addition, some more talks with employees were necessary to find out whether they were willing to support the new course set by the management. After all, they had to decide whether they would like to get on board or leave the learning journey.
Results and measures:
- Change agents document the changes made of the entire organization in a newsletter.
- Executives and employees regularly reflect on how the new values-based culture can be continued and expanded – in practice it was integrated into the kaizen processes as well as into the management routine.
- Members of the management team have developed a much better understanding of each other during the process. The increased level of trust enables an open exchange, which would have been unthinkable in the past.
- Greater consideration is given to individual strengths and to taking into account the impacts which individual actions might have on the entire system.
It was repeatedly reported that the persons participating in the process have learned a lot about themselves, and that this experience has also helped them to better communicate with their children/partners. The overall project is given an additional boost from this unexpected added value.
Anxiety-based “Me” mode vs. values-based “We” feeling
It was very useful for the management team, in particular, but also for all other employees of the organization to understand when their own behavior resulted from an anxiety-based “Me” mode or from a values-based “We” feeling. Reflecting on the rationale of their own behavior and the behavior of their colleagues and talking about it with each other helped them raise this awareness.
The learning journey revealed that it was necessary to regularly question one’s perspective and break out of routines. We regularly take the time to pause and reflect on our decisions and actions and adjust our next goals accordingly. It is important to also keep an eye on the “how”: Will our current actions and the way we cooperate have the desired effect? Are we currently solving the problem that actually needs to be addressed? Will the discussion help us meet our long-term goals? What is the right approach, irrespective of any personal opinions/feelings?
A learning mindset is crucial
The most valuable “souvenir”, i.e., the most important finding of this journey, is to raise people’s awareness of their individual attitude/mindset. When I am open and willing to embrace new ideas, transformation can be successful. All participants in this cultural journey have become aware of the fact that they are an outstanding team and that cultural transformation is only possible when they are all on board. The most important stages were completed; starting from the perception of “facing a difficult situation all alone, with no way out” to a feeling of “WE can do this together”.