When an organization’s culture is aligned with its business strategy, employees are more engaged and there is significantly less turnover. But two-thirds of companies have cultures that are not aligned with long-term business value, according to research from Aon Hewitt.
In a recent webinar (“Building a Strong Corporate Culture…and Seven Culture Killers“), Don MacPherson and Ken Oehler, engagement practice leaders at Aon Hewitt, provided some tips on changing your corporate culture as well as a list of the “Seven Culture Killers” that might be standing in your way.
An organization’s culture is defined by a set of shared beliefs (strategic priorities, business model, values), decisions (discipline, speed, inputs) and behaviors (leadership styles, team norms). The qualities of that culture depend on the company’s culture profile, Oehler said, which is determined by its primary focus.
Across the board, high-performing cultures are open/transparent, decisive, people-oriented, long-term-oriented and proactive. The relative importance of these traits depends on whether the organization’s primary focus is innovation, the customer, cost leadership, quality or risk management. Other traits are unique to each culture profile; for example, an organization that prioritizes innovation needs a more risk-tolerant and growth-oriented culture, while one targeted to cost leadership needs to be enterprise-focused, results-oriented and cost-focused.
What’s standing in the way of your organization building a strong corporate culture? Oehler provided a list of “Seven Culture Killers”:
1. Arrogance. While confidence can be a powerful motivator, arrogant organizations often fail to recognize the shifting landscape and can be blind to competitors and disruptors that are about to raid their business. Be willing to disrupt your own business before it’s disrupted by someone else.
2. Misaligned Leadership: Leadership teams need to share the same set of beliefs about the company’s focus and priorities, and those beliefs need to drive consistent decisions and a set of desired behaviors.
3. Lack of Clarity: When a company’s focus and priorities are unclear, employees will begin to form their own set of beliefs about what is important, likely leading to behaviors and decisions that aren’t in sync with those desired by leadership. Clearly define your business model priorities and connect those priorities to business value.
4. Missing on Employee Engagement: A healthy culture and engaged employees go hand in hand. Engaged employees will drive better business performance and be more committed to the company; passive or actively disengaged employees will hinder efforts to build or sustain a healthy culture.
5. Failure to Embed the Values: Employees need to fully understand the organization’s values and priorities. Putting a plaque on the wall isn’t enough.
6. Mixed Messages: When leaders say one thing, yet reward and recognize another, you wind up with confused employees and a dysfunctional culture. All levels of the company need to align.
7. Talent Churn: Turnover can be a culture killer, or it can be used to save a failing culture. Losing top talent and failing to effectively instill your culture with a new set of employees will erode a healthy culture. However, turnover can also present an opportunity to get rid of dead weight, reset expectations and make your ideal culture a reality.
Oehler provided some tips for changing your organization’s culture:
- Make sure leadership is modeling the right behaviors.
- When hiring new employees, look for people who fit the culture you want to achieve, even if they aren’t a good fit in your current culture.
- Make sure the rewards/incentives system is in line with the organization’s priorities, clearly defining performance expectations and motivating desired behaviors.
- Monitor the pulse of the company to see if you’re on track. An annual survey isn’t enough.
With a reasonable amount of turnover and a different hiring profile, an organization’s culture can be changed within three years or less, Oehler said.