Updated: May 20, 2021
Most leaders recognize how critical a high-performance culture is to their organization's success. Most also struggle to achieve it.
Developing the right culture is essential to achieving sustainable competitive advantage. Companies with a purpose-driven organizational culture outperform their peers. They attract and retain a diverse workforce with the highest-calibre skills. They empower employees to collaborate and innovate in agile way and inspire them to go the extra mile. They align workers and resources to advance strategic goals.
Why is a vibrant culture so crucial to the success of a business?
When people feel their work isn't consistent with their values, they don't work as hard. A healthy organizational culture creates an invested and loyal workforce. Creating a company culture that focuses on employees' overall well-being and happiness maintains organizational consistency and builds a well-oiled workforce.
What are the key ingredients to a vibrant corporate culture?
To achieve a high-performance culture, a company's purpose, strategy, and culture are closely interconnected.
Purpose is an organization's WHY. It articulates why the company's work matters to the world. It is the foundation of the company's mission, vision, values, and business culture.
Strategy defines WHAT the organization must do to succeed. An aligned business culture supports strategic goals, whereas a fragmented culture undermines them.
Culture determines HOW work gets done: What do people say and do around others? What traits and behaviours does the organization signal as valuable by rewarding and reinforcing them through promotions, funding, and incentives?
What should leaders be doing to not only create a more engaged corporate culture but also sustain it?
Leaders should get feedback on how they are perceived and align the feedback with the organization culture. Employees should take responsibility, too. They should ask themselves each day, "Did I do my best to set my goals? Did I do my best to achieve my goals? Did I do my best to stay fully engaged?" "When the leaders focus on improvement, there's increased engagement, and when employees do it, there's a positive change as well.
Three things need to happen for leaders to improve. They must have the courage to get feedback and to look in the mirror and ask whether their behaviour aligns with what they're teaching; they must have the ability to improve, and they must have the discipline to follow up and do the hard work to make the changes.
What are the biggest challenges to transforming a corporate culture?
1. Resistance to change
Shaping peoples' mindsets and attitudes can be challenging. Often, people have their own, fixed ways of seeing and doing things. While there isn't necessarily anything wrong with that, those underlying beliefs and assumptions can sometimes hinder innovation.
Getting started with changing mindsets is often the most challenging part. To succeed, it's essential to understand why people are against change.
Often, the reason is that they don't understand what change means for them. For example, they might see innovation only as a requirement to work more but don't necessarily see the possible positive impacts it can have on their work.
Your job is to communicate how these changes affect your team in practice and most importantly, what's in it for them. Help people understand why change is necessary for the business's continuity and the well-being of the team.
You can start by making small, gradual changes to your team's works and focus on getting positive results fast. Consider picking those so-called "low hanging fruits" first before announcing any major company-wide reforms.
2. Not communicating the purpose
Most of our time awake is spent at work. Without a larger purpose for what we're doing, people can quickly see their job as just another paycheck. There's no direction without purpose, and without direction, there's really no chance of reaching your destination.
People must feel they are an important part of something that makes a real difference for them to find real fulfilment and meaning in their jobs.
3. Rigid organizational structures
Organizational structures are typically quite hierarchical, especially in larger organizations. Although having some form of hierarchy is necessary, it might also cause some bottlenecks for innovation if it restricts information flow.
Communication shouldn't just flow up but also down and across the organization. If middle managers have too much on their plate, they often only see short-term goals and constant pressure to hit their performance metrics, which leaves little room for long-term improvement. Managers need to trust their employees and let them execute their ideas and provide them with certain limits to stay focused. Creating an innovative culture requires just the right amount of freedom and control.
What are the most significant missteps leaders take when attempting cultural change?
When leaders become too focused on the numbers, it sends the wrong message. The top management must be willing to step up and deal with employees whose behaviours are inconsistent with the culture – even if that person's numbers are good.
Although you might not avoid all challenges when shaping your culture, you should systematically approach them. If you fail to see positive change, look for possible obstacles that might be standing in the way of innovation and start removing these obstacles one by one.