Many leaders assume that because they have been successful before, they will repeat that success in their new organization, but these expectations rarely produce the anticipated result where a cultural change is involved – without a change in leadership style.
Assessing culture
The words companies use to describe their cultures usually sound reassuring – customer focus, excellence, teamwork, shareholder value – but the words don’t necessarily translate into real behavior in real businesses.
How people actually go about their work; how decisions are made; who gets promoted; employee interaction; and motivating factors are the real issues surrounding culture. What makes it tricky for a new CEO, especially an outsider, is that the important rules of culture are unwritten. This means any attempt to understand a culture revolves around listening to how the people on the inside describe the company.
New leaders must be able to identify the covert signals and invisible knowledge networks that are central to any organization. These unwritten protocols and unspoken taboos and conventions are encapsulated in the question, “How do things work around here?”
Any move into a new position or new company necessitates a crash course in its culture. Most new leaders know they must explore the organizational terrain, but it’s tough to delve deeply enough to see how a company really works or how different people will react to different leadership actions.
So how do you go about learning what you need to know?
Conduct a cultural assessment that will become a component of your strategic agenda. Solicit views and opinions from people who know the organization: board members, management team, employees, customers, suppliers, the financial community, strategic partners, regulatory communities and the media.
Ask how the culture affects work; what the company stands for; how it differs from it competitors; what the common traits among its successful people are; what is likely to result in failure; and who the most respected people within the organization are. Important patterns will quickly emerge.
Finding the culture clues
Language is an important indication of a company’s culture. The way people in an organization speak to each other and those outside gives a lot away.
Words, however, aren’t the only indicators. As mundane as it sounds, so too is how people dress. When Jim NcNerney took over as CEO at 3M, starched shirts prevailed among top management while the workforce dressed more casually. This in itself highlighted the disconnection between senior management and the rest of the company.
Lou Gerstner made his intentions clear without saying a word when he arrived at IBM on his first day as CEO – the sole blue shirt in a sea of starched white, long considered the corporate uniform. His dress sent a clear signal that change was on the way.
Company canteens and corridors, the layout of the office floor, the art on the walls and the demeanour of the people all send clues as to a company’s culture. Open plan set ups, for example, show that interaction between staff is encouraged while closed doors allude to a rigid hierarchy.
It may also help to set up a facilitated integration session where the new leader’s team members introduce themselves and discuss their work styles, air any concerns and generally work with the new leader to find common ground.
The most successful assimilations between new leader and company emerge from a process of compromise on both sides. Even if the culture needs changing, instituting a new order immediately is likely to breed resentment and, without buy-in, failure is almost guaranteed.
Nurturing culture change
Trying to transform a culture extends well beyond your first 100 days, and sometimes it’ll take years. The critical point in the early days is to be sensitive to the issue and to make an effective cultural assessment, thereby laying the groundwork for long-term change.
Being a change leader is perilous. Robert Tillman, former CEO of Lowe’s Corp explains: “They normally get assassinated because they build up so much ill will among other people within the corporation that they are subsequently ostracised.”
Minimizing the risk means familiarizing yourself with the subtleties of the culture; understanding the power base; recognising that a mandate from above doesn’t ensure a mandate from below; and trying not to change everything in the first 100 days.
Gerstner adds: “Changing the attitude of hundreds of thousands of people is very, very hard to accomplish. You can’t mandate it and can’t engineer it. What you can do is create the conditions for transformation. Provide incentives; define the marketplace realities and goals. But at some point you have to trust. In the end management doesn’t change culture. Management invites the workforce itself to change the culture.”
The invitation to change can be made more compelling by providing new measures of success; new operating processes; making changes to your management team; creating new expectations in and of the business; identifying change leaders; and finally, leading by example.
Conclusion
Taking on and leading cultural change is one of a new leader’s toughest challenges but also one of the most delicate. Too much change can break the culture and destroy the change leader and, even when change appears to be welcomed by the organization, there will be some resistance. It’s important to deal sympathetically and dispassionately with that resistance.
Cultivate change by working to understand the organization’s culture. Listen and observe it in action. Get input and ask questions. Make your first moves count, but ensure too that you pace that change. And continually step back to assess the tolerance of the organization to that change.
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Note
This article is a summary taken from You're in Charge — Now What? published by Crown Business, New York, 2005.