Psst ! . . . Wanna Buy a Culture Change?

 

The Economist cover

One of the reasons The Economist magazine has been around since 1843 is its commitment to high standards of journalism as it continuously delivers on its purpose: “to take part in a severe contest between intelligence, which presses forward, and an unworthy, timid ignorance obstructing our progress”. And its circulation is over 1.5 million readers worldwide.

Recently, in a review of a new business book, LEVERAGE: The CEO’s Guide to Corporate Culture, the Economist described the work as “a sensible approach in a charlatan-infested field” (The Economist (January 9, 2014.)

Charlatan-infested Field?

The many corporate culture consultants and psychologists pushing the growing fad of charlatan2corporate culture assessments and culture change methodologies are up in arms at the suggestion that their work is the work of “charlatans”.

But, in my experience, most CEOs and senior executives agree.  And employees who have to suffer top-down culture change “sheep-dip” programs tend to think senior management has lost touch with reality when its time for the vision and values culture change program. Some of the programs are actually very engaging and helpful with personal development and insights about teams and such important concepts as accountability or feedback and coaching.  But very few of them actually shift the culture!

The reality, in contrast to what the culture consultants say, is that only about 20% of culture change programs actually deliver on their change objectives (Smith 2007)

culture change rate

 Would you agree to surgery with only a 20% chance of success?

Where it all went wrong!

charlatanThe biggest reason for this high failure rate of culture change programs is that most CEOs and executives don’t really understand what corporate culture is, where it comes from and what are the change levers.  And almost all culture consultants are working from a fundamentally flawed premise.

Their belief is: culture is made up of shared employee values and culture change is about instilling a new set of values from top to bottom!

And if you review the extensive academic literature on corporate culture you will find nearly everyone describing corporate culture as Values or Shared Values! It all started with the Peters and Waterman 1982 best-selling book, In Search of Excellence, and just snowballed from there.

A Different Point of View.

First of all, people have values, not companies. Corporate culture is a collection of habitual and accepted behaviours used to interact with colleagues, solve business problems and deal with customers. How people routinely act and behave defines the culture, not printed corporate values statements.

It is extremely rare that people inside a large company share the same “values”.  Today’s modern businesses are more diverse than ever before, with employees from various religions, backgrounds and national cultures working together.  And depending upon your upbringing, the stated “value” of respect for others can have a very different meaning to an employee from a Japanese family than someone from the south side of Chicago!

When an individual joins a new company, whether as an entry-level employee or a senior executive, they don’t easily change their personal values, but they can and do change their work behaviours. And most employees want to “fit in” to their new department or subculture.

Corporate culture is defined by habitual behaviours, not written value statements! The concept of corporate culture being about values is neither accurate or helpful to the CEO or business leader who wants to develop a high performance organisation.

Culture change is the replacement of one set of “accepted and frequently used behaviours” for another.

When executives and employees roll their eyes at the mention of redefining the “corporate values” and launching a top-down culture change program, you know it’s time for a rethink! There is a better way!

John R. Childress

Author of LEVERAGE: The CEO’s Guide to Corporate Culture, and FASTBREAK: The CEO’s Guide to Strategy Execution, available from Amazon in paperback and eBook formats.

See the review of LEVERAGE in The Economist (January 9, 2014.

John also writes thriller novels:  novels.johnrchildress.com

 

About johnrchildress

John Childress is currently Visiting Professor in Strategy and Culture at IE Business School in Madrid and a pioneer in the field of strategy execution, culture change, executive leadership and organization effectiveness, author of several books and numerous articles on leadership, an effective public speaker and workshop facilitator for Boards and senior executive teams. In 1978 John co-founded The Senn-Delaney Leadership Consulting Group, the first international consulting firm to focus exclusively on culture change, leadership development and senior team alignment. Between 1978 and 2000 he served as its President and CEO and guided the international expansion of the company. His work with senior leadership teams has included companies in crisis (GPU Nuclear – owner of the Three Mile Island Nuclear Plants following the accident), deregulated industries (natural gas pipelines, telecommunications and the breakup of The Bell Telephone Companies), mergers and acquisitions and classic business turnaround scenarios with global organizations from the Fortune 500 and FTSE 250 ranks. He has designed and conducted consulting engagements in the US, UK, Europe, Middle East, Africa, China and Asia. Currently John is an independent advisor to CEO’s, Boards, management teams and organisations on strategy execution, corporate culture, leadership team effectiveness, business performance and executive development. John was born in the Cascade Mountains of Oregon and eventually moved to Carmel Highlands, California during most of his business career. John is a Phi Beta Kappa scholar with a BA degree (Magna cum Laude) from the University of California, a Masters Degree from Harvard University and was a PhD candidate at the University of Hawaii before deciding on a career as a business entrepreneur in the mid-70s. In 1968-69 he attended the American University of Beirut and it was there that his interest in cultures, leadership and group dynamics began to take shape. John Childress resides in London and the south of France with his family and is an avid flyfisherman, with recent trips to Alaska, the Amazon River, Tierra del Fuego, and Kamchatka in the far east of Russia. He is a trustee for Young Virtuosi, a foundation to support talented young musicians. You can reach John at john@johnrchildress.com or john.childress@theprincipiagroup.com
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