Changing Company Culture

June 18, 2013  |   Executive Coaching Blog   |     |   0 Comment

As part of our Executive Coaching practice we work with CEOs and Directors on changing company culture. Here we share with you 5 things you must do if you want your cultural change programme to work.



What is a Company Culture?


The reason people find it so difficult to change company culture is because they tend to focus only on behaviours and forget all the complex elements that together encourage and reinforce behaviours. To be fair it is hard to provide a simple definition of company culture, but in simple terms it is about corporate beliefs, attitudes and the way things get done in the company.


When introducing a cultural change programme many organisations create a programme designed to communicate and embed a new set of behaviours. An example of this might be the introduction of a team working culture. What seems to be forgotten are all the company processes and structures that together generate the current behaviours. As a result the change programme eventually gets extinguished by the strength of the current culture.


In our Executive Coaching work with CEOs and Directors on developing and implementing their own change programmes we have found that there are 5 critical processes that need to be addressed as a part of any successful cultural change programme. They are described in the following paragraphs.



Reward Systems


What you reward tends to get done. Organisational reward systems send one of the strongest messages about what is important in the company. So for example there is no point in saying that you want a sales driven culture if all you reward is the achievement of profit. Think through carefully what signal every element of your reward system sends about desired behaviour. If for instance you give huge severance packages to those that do not perform well – you may be creating a culture where people know that poor performance can lead to relative wealth. If you dedicate most of your available cash in a pay review to a general increase, there is no point in pretending you want a meritocracy where the best performers get the best rewards.


The key lesson is to make sure your reward system aligns with the new culture you want to introduce.




You would be surprised at how much notice people pay to who gets promoted in a company. So you need to make sure every hiring manager understands the behaviours that will get people promoted. For example there is no point in introducing a consultative leadership style if people see that those getting promotions are managers who consistently adopt an authoritarian leadership style. This just tells staff you don’t mean what you say.


Turning a Blind Eye


It’s unfortunate, but often there are people in influential roles who only pay lip service to the cultural changes you are trying to achieve. So for example if you want a coaching culture it will not be helpful if some members of your management team continue to hit their targets by simply telling people what to do. Give everyone the chance to change and the skills to do what you want. If there are some that don’t want to make the change they have to go whoever they are. You would be surprised how what a strong message this sends about how serious you are about change!


Organisation Structures and Approval Processes


Make sure that your organisation structure supports the culture you want to introduce. If you are seeking people to take greater accountability you may need to consider reducing the number of organisational layers. If you want better cross functional working it may be necessary to combine functions or even create new ones.


As part of your organisation review consider how decisions get made. If you are looking to speed up the pace of decision making you may need to devolve approval levels. If you want to tighten up controls you may want to do the opposite.


Executive Coaching can be especially useful in helping a CEO or Director in this area. Senior Executives will have their own agenda when there is a potential threat to their organisational influence and power base. An external Executive Coach can provide an independent sounding board for decisions on organisational structure.


Reinforce New Behaviours


One important way of making cultural change stick is, at least initially, to measure it. It takes a lot of effort and energy from staff and managers to change behaviours. Some say it can be as longer than a year. If you put in place a measurement system you signal the importance of the change and of course you also know whether it has actually happened.


There are lots of ways of doing this but one of the best is an attitude survey which can provide great feedback on what is going on in reality. For example if as a part of your cultural change you want managers to regularly brief staff on company performance, you can ask if this happens in your survey. If you want an open and transparent discussion with staff on their potential and training needs – ask if it’s happening.


When you get your results make a point of rewarding and highlighting those that are getting the best results and follow up on the barriers where there are poor scores. You would be amazed how well this works. The survey does not have to be expensive or lengthy. You can put a 10 question survey online at very little cost.


One important point is to make sure your survey covers everyone from CEO down through the organisation. Also make sure the results get publicised in departments or teams.



In Summary


We have found that our Executive Coaching clients that attend to these key areas have a much better chance of making cultural change stick. There are other areas that may also need to be considered but these can vary by organisation, an example of this would be Information Systems. However the 5 areas covered here apply to pretty much any organisation.



Tony Goddard



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