In a recent article in which I wrote about core principles for leading organizational change, I touched on the important role culture plays during transformations. Both good and bad. An organizational culture is basically a set of general behaviors, ways of thinking and shared values that develop over time within a company or team.
No company culture is perfect. There are positive elements that help drive the company forward and make the organization a great place to work. But then there can be negative aspects of the culture that inhibit growth, damage trust and hamper morale. In that article, I describe my philosophies on culture-enabled change - leveraging the strengths of the culture while mitigating the weaknesses - which ends by ingraining new changes into the culture.
Based on the experiences I have had in my own companies and from the vast amounts of research I have conducted, my original theories have been put to the test. Ten years ago, I would have told you that in order for a company to go through any significant transformation, they would first have to improve or change the culture. Five years ago, I would have said that it's the other way around - that the transformation process must first begin and make significant headway before the culture can really change or improve. Now I know that it's a hybrid of the two.
Senior leaders must have a solid understanding of the existing culture in order to better understand how it can be leveraged during the early stages of a change effort. The not-so-great aspects of the culture can simultaneously be improved by changing structures, rewards systems, HR mechanisms, promoting change evangelists and removing roadblocks. But the bulk of the lasting cultural changes, new mindsets and behaviors will gradually develop during the latter stages of the change battle - in large part because it takes a long time.
The most important thing to note however is how critically important culture is for organizational improvements to stick. Any restructuring, reengineering, process improvement, customer-centric strategy or quality improvement program has to truly be ingrained in the culture to avoid regression and the "old way of doing things" re-emerging.
I've seen companies spend years communicating the vision for change, implementing new company practices, add people, remove people and execute every aspect of their original transformation plan. They have identified and communicated quick wins to support the new strategies and quiet the objectors. They have seen tangible results impacting product quality, efficiency, and profitability. Everyone high-fives and concludes that the transformation is done. The reality is that it's never really done, especially if all that time, energy, budget and sacrifice didn't translate into actual culture change: new values-based ways of thinking and acting that are in line with the long-term vision for the original change "mission plan."
I've seen senior leaders that initiated important transformations take early retirement or leave to go elsewhere satisfied that "their work here is done" and that the company is in a better place because of the change efforts they led. Within a year of them leaving, things are back to the way they were before and almost all visible signs of progress no longer exist.
When visionary leadership is guiding the team - or transformation task force - and leading all aspects of the new strategies, it can overshadow the fact that real roots aren't growing deep into the soil of the organization. When their leadership is combined with effective managers who are diligently driving the plan forward it can become ever more difficult to discern whether real culture and mindset change is occurring. But once you remove that leadership and the guiding body leading the change dissolves - or is actively dismantled, it becomes extremely obvious as to how ingrained the changes are in the culture.
The first aspect of ingraining new organizational changes in the company culture is to recognize that this process starts at the beginning and is an important aspect of the process with the bulk of the culture change occurring towards the end.
The second thing to note is that lasting change that becomes anchored in the culture is largely dependent on the results: both short and long term. When short term wins aren't defined and actively managed, the team will start experiencing battlefield fatigue and lose faith in the mission. When it becomes obvious that all the time and effort is generating better results (i.e. better products at a lower cost) then the team will stay energized.
Third, constant communication of the change vision is imperative, especially when the mission plan comes into conflict and adjustments have to be made. Helping the team maintain a visual picture of what winning looks like will keep them stay focused and less distracted by obstacles and competing priorities.
The fourth piece of ingraining change in the culture is to recognize when new people must be added and when some people have to go. Organizational change is complicated and takes more time and resources than we ever think. Culture change to support those initiatives is no different. It takes a long time to build a culture and therefore a significant effort to change a culture. During times of change - especially radical change - it is often necessary to bring in new people that embody the new vision and shared values. Careful recruiting and selection is very important. Similarly, sometimes the company has outgrown those that don't share the new vision and are unlikely to change. Or worse, will attempt to derail the new vision.
And fifth, new structures must be put in place that support the overall vision - especially rewards systems designed to promote change agents and those evangelizing the new behaviors and mindsets. If new expectations are put in place but HR mechanisms aren't aligned to support those performance expectations, old behaviors will come back. And why wouldn't they?
Leading organizational change starts at the top but must involve as many people as possible. Alignment and participation create a shared sense of purpose. A shared sense of purpose combined with shared values becomes a culture. But only when the new ways of doing things are actually deeply rooted in the culture will that change be a lasting force - and therefore create a better company.