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"We need to change the culture," is a phrase bantered about when the organization's ability to respond to changing business conditions isn't working very well. But how do you change something as abstract as corporate culture?
Most organizations believe if the CEO communicates his or her strategic intent long enough or with enough conviction it will breed the type of behavior (and culture) needed to fulfill the corporate vision. In short, they hope the culture will adapt. This is naive thinking - and the organization rarely has time to wait.
While culture may lie in the abstract, it is ultimately linked to discrete business processes. Organizations that use communications campaigns to attempt cultural shifts either fail - or wait a long time for change to occur.
The key to changing culture is getting it out of the abstract and into the reality of execution.
Demystifying Culture
In their book, Execution, authors Larry Bossidy and Ram Charan, define culture as the sum of an organization's shared values, beliefs and norms of behavior. It is the goal of GE, for example, to be either first or second in each business they operate. That translates into behaviors that make up GE's culture, or "way of operating."
When Should Cultures Change?
CEOs set out to change cultures when their renewed vision for competitiveness is inhibited by the values and beliefs of their people. For example: GE's CEO Jeffrey Immelt believes that, in today's global economy, the key to being number one or two is more about innovation, versus the existing culture, which is all about grinding costs down and increasing share through acquisition.
Immelt's new initiatives reward behavior differently. Sure, costs and margins are hugely relevant, but an executive's ability to innovate has taken on a much different level of appreciation in Immelt's new GE. Immelt's focus on innovation has also changed GE's process for evaluating proposed acquisitions.
The Intersection of Culture and Process
Getting people to behave, in a style that supports an executive vision takes more than posters, town meetings and pep talks (which is what most companies try). With every desired cultural attribute, such as "we're customer oriented" lies a series of processes and behaviors that need to be deliberately put into place.
Having worked at both Digital and HP I speak from my own experience. Digital had a strong cultural value of "making your numbers" and missing them wasn't tolerated. Near
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