Learn more about organizational culture and how you can define, create and manage a high performing culture and create the ultimate source of competitive advantage.
A crucial aspect of an organization’s performance, one that often goes unspoken, yet influences every aspect of your work is: Culture.
When it comes to culture, your ‘why’ is the recognition that culture is the lifeblood of your organization. It’s the collective mindset and attitudes that dictate how you operate, how you treat each other, and how you approach your work. It’s the invisible force that can either drive you towards your vision or pull you away from it.
Edgar Schein, a leading authority on organizational culture, tells us that culture is not something we have; it is something we are. It’s not an external entity that we can manipulate at will; it’s the shared experiences and values that bind us together. So, when we invest in culture, we invest in our people and our future.
Firstly, you need to acknowledge and understand the existing culture. This involves looking at your shared assumptions, beliefs, and values – your ‘way of doing things.’
Next, you need to clarify your vision and values – your ‘why’ and ‘how.’ These form the bedrock of your desired culture. They provide the direction and the guidelines for behavior.
Then, we need to align your behaviors and practices with your vision and values. This is where leadership plays a vital role. Leaders need to ‘walk the talk,’ demonstrating the behaviors that reflect your values and drive you towards your vision.
Lastly, you need to reinforce the desired culture through consistent messaging, education, rewards, and recognition. This helps to embed the desired behaviors and attitudes in your daily routines.
You build an organization that is more than just a workplace. You create communities that are driven by a shared purpose and values. You foster an environment where people feel valued, motivated, and aligned with your organization’s vision. This not only improves performance and productivity, it also enhances employee satisfaction and retention.
Investing in culture is not a luxury; it’s a necessity. It’s the foundation that determines whether you merely survive or truly thrive. So let’s heed Edgar Schein’s wisdom and invest in creating a culture that drives us towards a ‘why.’
Edgar Schein, an American organizational psychologist and former professor at the MIT Sloan School of Management, is known for his work on organizational culture. Schein defines organizational culture as:
“A pattern of shared basic assumptions that the group learned as it solved its problems of external adaptation and internal integration, that has worked well enough to be considered valid and, therefore, to be taught to new members as the correct way to perceive, think, and feel in relation to those problems.”
In simpler terms, Schein’s definition suggests that organizational culture is the collective understanding and learned behaviors that a group develops while addressing challenges and adapting to its environment. This shared set of assumptions is considered effective and is passed on to new members, shaping how they perceive, think, and feel within the organization.
Edgar Schein offers some great advice on how to create and manage organizational culture. He emphasizes the importance of understanding the underlying assumptions and values that form the foundation of an organization’s culture. Schein proposes a three-level model to better comprehend and shape culture:
To create collective understanding and learned behaviors, Schein suggests that leaders:
By understanding and applying these principles, leaders can effectively shape the collective understanding and learned behaviors that form the foundation of their organization’s culture.
In his book The Culture Code, Daniel Coyle points out that “group culture is one of the most powerful forces on the planet. We sense its presence inside successful businesses, championship teams, and thriving families, and we sense when it’s absent or toxic”.
So rather than culture being important, it could be argued that having a strong company culture is existential. Why existential? One of the key reasons being that to thrive in the long-term most organizations need to continually find new ways of using the knowledge within teams to unlock value for customers, with value coming in many forms. E.g. Creativity, innovation or problem solving.
Employing smart, energized, experienced people is not enough. These people need to work in a culture that allows them to channel those attributes at the moments that matter most. However, how people think and act when interacting with colleagues as well as customers varies between organizations, but is largely dictated by the type of culture a company has formed.
Culture clarifies and reinforces the values and standards of behaviors that are expected. Some of those standards are soft and might involve how we listen and communicate with each other, for example with respect. Some standards might be more process oriented or be work rituals, like how ideas are shared and how meetings are run.
The values, behaviors, processes and rituals that make one team outperform another used to be ambiguous. Luckily here we are in 2022, entering 2023 and it’s now well understood. It’s these values and ways of behaving that you want to become the glue that bonds people together.
So here we are going to explore recent research on how to build a strong business culture and more specifically how culture is shared, reinforced and tracked to ensure that it is maintained at the high performing levels you need to remain competitive.
Let’s start by looking at how you might be able to spot that you might have a culture issue. Common symptoms are:
Missed KPIs and Objectives and Key Results, and projects are not getting delivered
Business in not growing
Talent is leaving
Lots of finger pointing and blame going on
When people say they’re going to do something they often don’t follow through
Of course you can also look at how high performing teams work and see which aspects you think are present in your teams as well. Or use specialist tools like ZOKRI to track your culture and spot issues as they arise at the team or company level.
After four-years visiting and researching successful groups Daniel Coyle found that there are three skills that groups need to acquire in order to perform at their full potential.
But before you can develop these you need leaders that are motivated to want to be the change in order to be the best you can be, to want to learn because you won’t have the answers, and willing to do the work to change – change is hard.
We are obviously all human, therefore one would assume that you too would agree with simple observations like:
Appreciation, recognition and encouragement the better people perform.
Playing to your strengths is better than having to work overly hard to learn new skills or cover weaknesses, and still underperform.
Trust is everything in a team and when we know with certainty because of your experiences not words that the people around us are reliable, strong and will do what they say they are going to do, we are happier and also want to be trustworthy.
People want to be treated as an individual and we want the people around us to care about us and having a manager that takes the time to find out what’s going on, what matters to you and what is needed goes a long way.
People want to be on a mission that excites them and feels like a great use of their time. Not everyone is changing the world but you might be making customers’ lives better or easier. Profit targets on the other hand is a poor motivator and is hard to get excited about if you’re not in the C-suite.
Now imagine if these are not present. It’s obviously not ideal and the job of leaders and culture management is to optimize an organization’s culture for its employees as well as customers and shareholders.
Teams no longer exist in clearly-bounded groups, they are more dynamic with cross functional teams and collaboration being normal. Companies need to be able to communicate and coordinate across differences like expertise, status and geography.
Amy Edmondson’s work on Psychological Safety and shared in her great book The Fearless Organization has found that teams also need to be able to work without interpersonal fear. Team members can be themselves, participate fully, display candor, and don’t hold back from sharing ideas and opinions. The working environment is safe for interpersonal risk taking.
What’s more, high levels of Psychological Safety have been able to explain the differences in performance between different workplaces with the key benefits being:
Mistakes are reported quickly and quick corrective action is taken
Big ideas are shared and genuine innovation is commonplace
In her book, Amy Edmondson describes how people constantly calculate the risk of speaking-up, both consciously as well as subconsciously. The result of feeling that there is a risk involved in admitting a mistake, pointing out an issue, or even sharing an idea, is the team and organization’s performance suffers and eventually we also become dissatisfied.
In his book Leaders Eat Last, Simon Sinek points out similar issues people face when people don’t feel safe, and advantages teams have when they do.
Given its impact on performance, how does the book suggest you create a Psychologically Safe Culture?
If ideas and innovation is the lifeblood of a company it follows we want and need employees to share their knowledge and ideas freely. If there is a reluctance or a perceived risk associated with communications then you’re not getting to hear everything on offer, and the chances are some of what you’ve missed would have been game-changing.
Now think about how people are asked to share what they are thinking, the systems, processes for capturing, debating and considering what is being offered, and the level of follow-up and feedback offered.
Is there a chance that opinions and ideas are quickly shut down, not really considered and quickly forgotten, no matter how good they were? Now imagine how that feels and how you might quickly become more reluctant in the future to share?
Now imagine that feedback and new ideas are treated as assets with material value. Gold amongst the bedrock of the day-to-day. What would that signal and how would people behave as a result?
Once an idea is shared for example, perhaps the personal sharing is given time to write a short and well structured proposal on the idea for consideration in the next meeting, like Amazon does with their famous 6-pager, and McKinsey do with their Minto Pyramid Principle.
These well thought through ideas and proposals might then be recognized in ZOKRI by managers and colleagues in ZOKRI with recognition tags like:
“Ideas shared and explained brilliantly ”
In addition, files could be uploaded to a custom section of development plans and appraisals.
If you want a company full of high performing teams you need to make the provision of constructive candid feedback normal positive working practice.
It has been observed in Pixar’s Braintrust that when people are safe enough to “contribute insight, opinions and suggestions, the knowledge in the room increases exponentially”. You literally “think smarter”.
If this is a behavior you want to adopt you could codify it as part of your culture in ZOKRI and colleagues could recognize each other for “useful, constructive feedback”.
Rather than accept failure, Psychologically Safe teams seek to understand failure and learn from it. Failing rather than causing fear has to trigger a learning process like a retrospective, and be a positive experience.
The fact that when teams or individuals are brave enough to set the bar high, work really hard before working out that the initiative was not going to work and stop (failing fast), nobody is going to lose their job if you fail needs to be clear.
If this is a behavior you want to adopt you could codify it as part of your culture in ZOKRI and colleagues could recognize each other for “trying hard, failing fast and sharing learnings”. Others might then applaud this, the opposite of what one might think would or should happen.
In her book, Amy Edmondson tells the story of Eileen Fisher, a lady that created a $500m + revenue company from not knowing, listening, learning fast and not being afraid to be vulnerable.
It turns out that these traits are also present in Psychologically Safe teams. You want your people to all contribute, carefully listen to each other, and when someone does not know or understand something, say so so that they might learn.
If this is a behavior you want to adopt you could codify it as part of your culture in ZOKRI and colleagues could recognize each other for “taking the time to teach me today”.
Strategically aligned OKRs and KPIs in and across teams are important to a healthy culture as they provide clarity on what success looks like over a year or a quarter.
To achieve those goals and metrics you’re going to need to have a fully invested team that wants to do their best work for the company and the team.
Which is exactly why ZOKRI has brought together the best of what OKR and KPIs bring to teams with culture and performance management features, designed to guide, recognize and develop people.
When it comes to articulating the kind of culture you want inside your organization, there are varying methods from a full culture deck, to a hybrid of decks and handbooks plus culture management in software like ZOKRI.
According to Culture Decks Decoded, Netflix has a 125 page deck that “was written so that employees could have clarity about what’s important for success, what to expect from each other, and to honestly tell the truth about how the company operates.”
Whether you’re creating a deck or platforming your culture and culture management in software like ZOKRI, the jobs they do for the company and employees are similar.
Share the Mission, Vision and Purpose of the organization, hopefully creating a sense of excitement, urgency and a feeling that everyone is on the same exciting journey.
Inform and reinforce your values and required team and interpersonal behaviors that are expected – with safety hopefully being central.
Share key Company OKR and KPIs and what success looks like for the company and teams.
Bretton Putter in his book Culture Decks Decoded analyzed decks from companies like Hubspot, Netflix, LinkedIn, Hootsuite and others. There were obviously differences, but enough commonality to be able to see commonality. He suggested the following component:
What’s obvious from these sections is how providing purpose, goal clarity and transparency , and safety are central to the cultures being defined and managed.
Just saying what is expected is not enough though. This is where system thinking and operationalizing these elements in systems, processes, rituals and having data and analytics matters.
If you would like to see how ZOKRI’s suite of features could help you create your own high performing culture, book a demo and take a trial.
Culture alone with not allow you to win the market or niche you have chosen to address and serve. You will need a strategy, strategy needs goals and KPIs, and people need performance management to ensure they align and develop.
Mission & Vision
We all want to be on a Mission. We all want to know what the Vision is.
The values that ensure your Vision can be achieved.
Reinforced via praise and recognition. Measured via analytics in ZOKRI.
Things like Revenue, Growth, Profit.
These are never a Strategy. How you improve these is Strategy.
People & Process
Aligning the right people, doing the right jobs, in the right way