Organizational culture powerfully influences a company's performance -- or at least we say so. I often hear executives reassure me that projects will get done because "we have an execution culture," or that customers will be well taken care of because "we have a culture where the customer comes first." At the same time, culture is also one of the great rationalizations for managerial shortcomings. Many times I've heard that a project was delayed because "we don't make quick decisions around here," which is the managerial equivalent of "the dog ate my homework."
But the problem with all of these statements -- both positive and negative -- is that they don't really mean anything. Worse yet, they can't be translated into any kind of action. At best these declarations are vague generalizations; and at worst they are misleading stereotypes.
The truth is that most leaders don't know how to develop a useful picture of their organization's culture, which is why they resort to platitudes. However when managers can better articulate the behavioral patterns that constitute the culture, they can determine which behaviors facilitate results -- and which behaviors should be avoided.
For example, a large automotive parts company had just completed a merger, and the senior team -- made up of leaders from both firms -- struggled with making decisions. They either took too long to decide, or the decisions just didn't stick. To fix this problem, the team asked themselves some simple questions about the decision-making culture: To what extent are decisions currently made by consensus or by the CEO (on a scale of 1-10)? On that same scale, how were decisions made at your heritage company? And on the same scale, where should the decision-making process be in the new company?
Each person on the team answered these questions separately, and a facilitator consolidated them as the basis for a group discussion. When looking at the answers, the team quickly realized that the previous companies had very different decision-making cultures (one was a slow process of building consensus, and the other used open, time-bound debate with final decisions made by the CEO). The team members also had very different expectations for how the process should work. By making these differences concrete and conscious, they were able to have a constructive dialogue that led to ground rules for decision-making.
Any management team can assess its culture by asking these kinds of simple questions across a range of organizational behaviors. For example: To what extent do we reward individual vs. team results? To what extent do we share information broadly or parcel it out narrowly? To what extent do we encourage or discourage risk?
Asking these kinds of questions can smoke out the differences in expectations that people have about the organization. Not everyone experiences culture the same way, so a structured way to discuss those differences can increase alignment and the ability to take collective action. In practical terms, culture is not an intangible cloud that hangs over a company, but an outcome of the way people behave on multiple dimensions. Better understanding of these behavioral patterns -- and how each person experiences them -- makes it possible to decide whether to continue them or not.
To what extent do you question your organization's culture?
Cross-posted from Harvard Business Online.