Company culture is a fundamental part of every organization’s functioning. However, a change in the culture becomes necessary for improving employee satisfaction and boosting productivity. Hence it becomes important to learn how to facilitate a cultural transformation in an organization to make sure that the employees are happy and working to the best of their ability.
Cultural transformation is much more than just a phrase. It is a commitment towards shifting the company’s culture so that employees feel like they belong here and can invest in the long-term success of the organization. When an employee feels this way, the company wins and workers who feel valued in their current positions are 50% more productive than those who do not.
What is Culture transformation?
Cultural transformation is defined as an evolving and developing process which changes based on the values defined by the organization This transformation rewards the organization with a thriving, values-driven company culture that drives sustainable success.
A cultural transformation requires taking a thoughtful look at your company and making changes to shape your policies, processes, commitments, and behaviours. A good cultural transformation will change the way the employees think, act, and deliver the services and products to your customers. Every interaction should reflect the cultural values starting from the first time a customer contacts the company to the end of the transaction.
A good culture within an organization will bring-in happier employees which are 20% more productive than unhappy employees.
Glassdoor’s research shows a positive relationship between customer and employee satisfaction. This link is even stronger in the industries where front-line employees have direct and frequent contact with clients. Hence, transforming the culture for improving employee satisfaction can have a significant impact on the customer’s happiness and productivity of the organization.
For understanding the real-life cultural transformation let us have a look at how Unilever Brazil did it.
In 2005, Uniliver’s revenues started to slow. To keep the momentum alive the company knew they had to make some changes. The company decided to make changes not just strategically, but they also made culture transformation within. The transformation relied on five changes:
- Accelerating growth
- Creating sustainable transformation
- Increasing revenue
- Identifying capabilities required for boosting business.
- Managing key performance indicators
The changes were strengthened by conducting cultural values assessments every six months. The result?
- The Revenue grew by 3% in 2008 to 14% by 2010.
- The company’s cultural score fell from 37% to 10%
- The culture that was driven by internal competition, short-term focus transformed into a business environment with long-term goals, teamwork, shared vision along with an orientation towards customer satisfaction, and employee happiness.
Why data culture is important?
An employee usually spends over one-third of their lives at the workplace. Moreover, they ought to work for hours to meet the expectations of an organization. Naturally, when an employee is happy and satisfied at work, his overall personality and productivity is improved. When your organization ensures a good work environment, your employees wake up each day looking towards spending a great day at work. Hence the employee’s feel the same loyalty, ownership, and dedication towards the organization as you do, and the result clearly reflects in the work they deliver.
Without a strong data culture, organizations may be missing opportunities to use the data they have collected. A strong data culture encourages organizations to make reliable decisions which can be validated with the data. Hence the organization makes decisions by calculated risk which reduces the loss of revenue, growth, and people. Data in the organization can help them in becoming more efficient, which includes improving the customer experiences, building strategies, generating ROI, streamlining business processes.
How to build culture?
An organization’s customs, rituals, behavioural norms, traditions, symbols, and general way of doing things are the visible manifestation of its culture; they are seen when someone new walks in the organization. With time behavioural norms develop that are consistent with the organization’s values.
Though culture emerges naturally in most organizations, Once the culture is framed, the organization can establish a values committee that has a direct link to leadership. This group will make sure the desired culture is alive and well. Organizations must hire people who are aligned with the organization’s values and have the competency needed to perform the job.
How to sustain cultural capabilities?
The management of organizational culture starts by identifying the company’s culture traits. These traits are the core business activities, processes and philosophies which characterize how the organization does business day-to-day.
The culture can be managed by identification of these traits and accessing the importance with current business objectives. Leaders within an organization should approach culture management initially by gaining an understanding of the common traits found in all businesses. Then, they should take the following steps to manage their organization’s culture:
- Start by Identifying common traits, including organization’s social, material, and ideological culture.
- Representatives from all levels, functions and locations of the organization should assess the validity, significance, and monetary value of culture. (They must be assessed by shared assumptions, values and keeping in consideration beliefs of different individual’s)
- Summarize findings and share them with all participants for additional insights.
- Create a culture management action plan.
Practices to Develop Culture
When an organization does a good job in accessing its culture, it can then establish policies, programs and strategies that support and strengthen its core purpose and values. The same core beliefs motivate and unite everyone, cascading down from the C-suite to individual contributors.
There are many tools for developing an organizational culture which include hiring practices, onboarding efforts, recognition programs and performance management programs. The biggest challenge lies in deciding how to effectively use these tools and how to allocate resources appropriately.
Talent hiring and onboarding practices
Traditionally, hiring focuses primarily on an applicant’s skills, but when a hire’s personality also aligns with the organization’s culture, the employee is more likely to perform well. The unfit hires and rapid departures of unfit people cost approximately 50 percent to 150 percent of the position’s annual salary. According to some statistics nearly one in three new hired employees leaves within a year of hiring, and this number has been increasing steadily in recent years.
Some hiring practices which can be followed for ensuring cultural fit are mentioned below:
- Ensuring that the organization’s vision, mission, and values statements are aligned.
- Conducting a cultural fit interview.
- Do not tell candidates about culture up front. Leave the discussion of company culture for later.
- Make sure a minimum of three people is involved in the hiring process.
- Onboarding is essential for introducing the newcomers with the organization’s value system, norms, and desired behaviours. Employers must help the newcomers in becoming a part of social networks within the organization and make sure that they have early job experiences that reinforce the culture.
Culture of rewards and recognition
These programs are used by employers to motivate employees to perform in accordance with the organization’s culture and values. For example, if teamwork is one of the core values, bonuses should value teamwork and not be based on individual performance. Employers should also put attention to those who personify the company’s values.
Employers must ensure that the organization clearly and consistently communicates its culture to all employees. Conflicting messages regarding corporate culture when heard may create distrust within people. Cultural inconsistencies will make workers discouraged, and they will not be able to perform the best.
Organizational culture needs continuous monitoring and assessment aligned with enterprise goals and objectives. Performing the below mentioned steps may help organizations assess culture:
Develop a cultural assessment instrument. This instrument will rate the members of the organization on the key cultural dimensions.
Administer the assessment. Survey respondents should include employees from all levels, functions, divisions, and geographical units of the organization.
Analyse and communicate about assessment results. Leaders and managers should discuss areas of agreement and disagreement about the culture.
Conduct employee focus groups. Just because top leadership agrees on organizational culture does not mean that all employees should see things the same way.
Cultural assessments, and other activities will help in identifying cultural inconsistencies. Leadership can then eliminate the inconsistencies.
Principles of culture
1. Align strategy with culture
Some corporate leaders struggle with cultural adoptions for years, without fully focusing on the question: Why do they want to change the culture? They are not able to connect their desired culture with the strategy and business objectives. Therefore, maintaining optimal balance between strategy and culture becomes important for enhancing productivity. For example, the Mayo Clinic which is world renowned for bringing together specialists from different medical fields to diagnose and treat complex diseases, the clinic promotes high levels of collaboration and teamwork.
2. Honour the Strengths of Your Existing Culture
It is easy to dwell on the negative traits of your culture, but corporate culture is a product of good intentions that evolved in unexpected ways and will have many strengths. They might include a deep commitment to customer service or a tendency of bringing innovation. If you can find ways to demonstrate the importance of the original values and share stories that illustrate why people believe in them, they can still serve your company well.
3. Integrate Formal and Informal Interventions
As the organization promotes new behaviours, making people aware of how they affect the company’s strategic performance, is important, be sure to integrate formal approaches like new rules, metrics, and incentives with informal interactions. Whether formal or informal, interventions it should do two things: reach people at an emotional level (how they feel about the work) and tap rational self-interest (providing monetary rewards, appraisals, and external recognition to those who come on-board).
4. Measure and Monitor Cultural Evolution
It is essential to measure and monitor cultural progress at each stage you make some changes. Rigorous measurement allows executives to identify changes, correct strategy and plan where needed, and demonstrate tangible evidence of improvement which can help to maintain positive momentum for long term improvements.
Cultural transformation in any company is a complex process. This culture should reflect what is important for them, and what is necessary for succeeding in their marketplace. What makes a culture transformation truly great is whether it enhances the talent and ability of its people. However, it can have a tremendous impact on the organization and its future. The effort is worth it, and it will be reflected in the employee satisfaction and productivity numbers in years to come.