HEALTHY GROWTH manifesto
Organizational culture has long been a hot topic in leadership circles, but recent changes in the world and in the world of work have moved culture to the very top of the leadership agenda. Before we address how you can simplify this potentially complex topic, we will address the focus of today’s worker to see why culture is currently a key factor.
The current environment has forced many of us to grow in ways we would have never imagined. Healthy growth is positive, strong, sustained and serves all parties. Healthy growth is a choice. When you help others grow, you grow… and growing people fuel growing organizations.
Expansive research by Gallup clearly shows a clear shift is focus for today’s worker
|My Paycheck||My Purpose|
|My Satisfaction||My Development|
|My Boss||My Coach|
|My Annual Review||My Ongoing Conversations|
|My Weaknesses||My Strengths|
|My Job||My Life|
This proprietary healthy growth process is based on experience with executive clients since 1999. It is aligned with the unique needs of today’s worker and the requirements for today’s leader. This process predictably yields healthy growth for you, your employees, and your business, your employees, and your business.
Leadership is a force multiplier when it comes to the healthy growth. The leader sets the vision, expectations, encouragement, and most importantly, the example for the five growth factors. The result is healthy growth… for the leader, for the team and for the business.
Healthy Leadership x 5 Growth Factors = Healthy Growth
HEALTHY GROWTH CHECK-UP
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Using this healthy growth process as a framework, we will focus on one of the five growth factors:
The word culture is derived from the Latin word “colere” which means to tend to the earth and grow or cultivate and nurture.
Culture is so simple yet can be complex to change. It is invisible, but most powerful when it is visible. It is spoken, and it is also unspoken. It is internal but also felt externally. It is form and substance. It is found in the halls and walls but also in hearts and minds. It is organizational and personal. It is hard to integrate culture but easy for it to disintegrate without nurturing.
And finally, in a Korn Ferry survey, nearly three-quarters of executives described culture as being extremely important to organizational performance; however, only a third said that their culture was fully aligned with their business strategy.
Every organization has a culture by default. Few organizations have a culture by design.
When we are aligned, we are working in accordance with each other. Even when an organization has intentionally aligned its culture as part of its strategy, change naturally forces cultural misalignment. The more a changing organization wants to keep its culture the same, the more it must change what it does.
Culture can be a complex topic, with consultants drawing wall-sized models to explain cultural dynamics. As Warren Buffet said, “There seems to be some perverse human characteristic that likes to make easy things difficult.” Healthy leaders understand complex concepts like culture and boil them down into simple terms. For example, designing culture can be expressed with a simple, two-word formula:
It’s that simple. Organizations are comprised of human beings, and humans are predictable and virtually always do what they are reinforced to do. So, if you reinforce behavior A, that is what you will get. It is not uncommon for leaders to express frustration with the behaviors of their teams, when the same behavior is exactly what they are reinforcing. For example, they might be frustrated by siloed, non-collaborative behavior while that is what their compensation system is rewarding.
So, as you design an aligned culture, the question is, “Which behaviors do I want to see more of to help meet the needs of our stakeholders?”
Don’t throw the baby out with the bathwater as you align your culture. Rarely is a culture completely misaligned with all stakeholder needs, so be sure to honor the past by preserving what is working. Shift to the future by reinforcing selected, new behaviors.
Start by aligning (or realigning) your cultural systems with behaviors that support the needs of your stakeholders. Cultures are created and reinforced by these 12 cultural systems:
- Leadership mindset and practices
- Well-being support
- Rules and policies
- Goals and measures
- Rewards and recognition
- Staffing and selection
- Training and development
- Ceremonies and events
- Physical environment
- Organizational structure
Aligning these systems with your stakeholder needs closes the gap between stated and operating culture so you can achieve workplace integrity.
These cultural systems must be aligned vertically and horizontally with:
- the needs of your stakeholders (vertical alignment) and
- other cultural systems so they reinforce each other and do not contradict (horizontal alignment).
For example, a company that values innovation wants to vertically align their employee selection system by designing it to hire innovative thinkers and then reinforce innovative behavior once they arrive with appropriate reward systems.
This same organization must create horizontal alignment by ensuring the above 12 systems are reinforcing innovative behaviors and not inadvertently squelching it with bureaucratic decision making or communication systems.
When your culture is aligned people thrive because there are no friction points between what is said and what is done. All energy is spent on growth versus being confined the by weeds of contradiction. So, throw out the complex models of culture design, and keep it simple:
Organizations with the “right” kind of culture (i.e., aligned) significantly outperform firms that do not have these cultural traits by a huge margin. Examples from an 11-year Harvard Business School study show a variety of areas in which companies with aligned cultures outperformed their counterparts:
- 4.1x revenues
- 12.2x stock price
- 756% net income improvement (vs. 1%)
- 15x return on investment.
In a Stanford University study, higher performing companies matched to a top competitor compared favorably in the following ways. In higher performing companies:
- 61% had stronger indoctrination of new hires into the Culture, Guiding Principles, and Practices
- 72% had greater tightness of fit around their Culture (i.e., “buy in or get out”)
- 78% had greater alignment between their culture and what the company believed it needed strategically to succeed in the marketplace now and in the future.
Further, companies on Fortune’s Best Places to Work list benefit from two times the number of applicants from which to select and one-half the turnover rate. Reducing your turnover by half and the associated savings would alone warrant the time and investment to align your culture.
Key Cultural Systems
There are three key differentiators between healthy and unhealthy cultures. They are the first three cultural systems listed above: values, leadership, and communication.
|Healthy Cultures||Unhealthy Cultures|
|Employees viewed as humans first||Employees viewed as a results-drivers first|
|Nurture both employee and business growth||Focus on employee or business growth|
|Team over me||Me over team|
|Growth / change||Stability / status quo|
|Transparency / real talk||Facades / company line|
|Genuine connections||Transactional / political relationships|
|Healthy Cultures||Unhealthy Cultures|
|Leverage strengths||Improve weaknesses|
|Willing to be vulnerable||Guarded|
|Embrace diverse perspectives||Fear of dissenting opinions|
|Ask questions||Tell answers|
|High trust with employees||Low trust with employees|
|Confidence in leaders||Skepticism toward leaders|
|Facilitate fast decisions||Barrier to decision making|
|Find solutions||Find fault|
|Measure results and behavior||Measure results or behavior|
|Healthy Cultures||Unhealthy Cultures|
|Constructive disagreement||Polarized perspectives|
|Informal, organic networks for ideation||Formalized, programs for ideation|
|Frequent and predictable rhythm||Infrequent and sporadic rhythm|
|Consistent messages||Inconsistent messages|
Save yourself and your organization time and money by avoiding the myriad of culture change initiatives, the large majority of which fail within 18 months.
Focus your efforts on aligning the 12 cultural systems with behaviors that support the needs of your stakeholders. You will be on your way to inspiring healthy growth!
Contact us to discuss how you can design an aligned culture.