These 8 Levers Of Organizational Culture Will Drive Great Performance
Forty-six percent of business leaders say that culture drives employee productivity, engagement and retention — and 90% say that the importance of a company’s culture has increased in the current business climate.
Ironically, fewer aspects of organizations are more misunderstood than culture. Easily confused, and often over-simplified as “employee engagement” or “the values,” organizational culture is far more complex. The forces that shape people’s behavior, for better or worse, are intricate. That’s why, when attempting to change or mature culture, you have to dig deep. Simply hanging a new set of values on the wall and launching a campaign with great fanfare to promote them does little more than make people more cynical.
Unlocking and honestly studying the levers of organizational culture is key to transforming your business for the better. When evaluating these levers of organizational culture, it’s important to remember that there’s not necessarily a one size fits all approach to certain types of behavior. It is up to leaders to determine if the current direction is shaping the organizational culture in a way that will help it achieve its goals.
Lever #1: How Leaders Sets Direction
How leaders set direction for their company goes a long way in shaping the attitudes and engagement of everyone involved.
Much of this depends on how you set the goals and direction for your organization. For example, you could have very specific goals with predetermined performance levels and targets. On the other end of the spectrum, you might prefer to use evolving goals that adapt and emerge as circumstances dictate. Similarly, your organization could implement a targeted focus with a limited scope, or aim for a broader reach.
Regardless of how you address the above decisions, your mindset regarding the future can go a long way in instilling confidence in your team. Viewing the future as an opportunity for success will provide energy and help rally team members around a shared cause. On the other hand, viewing the future as a threat could drive individuals who are motivated by overcoming adverse circumstances — but it could discourage others.
Lever #2: How You Achieve (and Reward) Results
This lever is heavily influenced by the nature of your work and your approach to that work.
As Robert DeFalco, president and owner of Robert DeFalco Realty explains, “You need to be professional, have integrity, and work within great ethics — particularly if you work in a highly regulated space. You must treat people well, appreciate them and reward good behavior internally and externally. The customers’ and clients’ best interests must be considered first and foremost. Honesty, respect and ethical service can become any great company’s hallmark if done correctly. At the end of the day, your personal values reflect how you approach your business.”
In some fields, focusing on speed and spontaneity to capitalize on unexpected opportunities, with some tolerance for imperfect outcomes is important. And other companies fall in between, with different levels of precision and spontaneity needed for different activities. You must find the right balance to deliver the results your customers want.
Leaders can help guide their team to achieve the right approach to work based on how they influence performance. This may need to be adapted to each individual by appealing to either their intrinsic desire for success by providing praise and support, or by enticing performance with tangible rewards (such as recognizing outcomes or performance standards).
Lever #3: How You Lead
How leaders relate to their team members is a key aspect of setting the culture.
At one end of the spectrum are leaders who demonstrate great confidence in their team. They give lots of autonomy to individual team members, while still being accessible to provide support when needed. Leaders model desired behavior, and expect team members to follow suit. On the other side are leaders who act with caution, maintaining more control over routine activities and having a strict hierarchy that defines leader/employee relationships.
Some organizations may try to emphasize consistency among their team — essentially nullifying perceived differences among team members by discouraging policy exceptions and modeling consistent behavior. Others prefer to leverage differences, and are more likely to provide policy and procedure exceptions based on circumstances.
Leaders may also vary in how they make decisions — in some cases, involving other team members in decision making, while in other cases, making unilateral decisions that are then communicated to the team.
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Lever #4: How You Form Relationships and Networks
Leaders also define the work structures that exist within their organization. Does the nature of your work depend more on individual work (and individual accountability), or does it prompt collaboration with shared responsibility?
When evaluating this lever, leaders should be especially mindful of the impetus for interaction within their teams. A highly competitive work environment with explicit comparisons between individuals and heated debate between different viewpoints can all too easily turn toxic — especially in comparison to cooperative environments that encourage mutual support in the pursuit of common goals.
Lever #5: How You Communicate
How you communicate can go a long way in ensuring that your team responds appropriately to your management of the other levers of organizational culture.
Like it or not, people closely monitor the relationship between leadership’s actions and words. Today’s employees and audiences value authenticity, even when that requires candid communication and acknowledging shortcomings. Trying to manage perceptions can be a good way to communicate your organizational strengths, but if this comes at the expense of transparency, you’ll quickly lose trust.
As part of this, leaders must evaluate which information requires selective disclosure and which items can be broadly disclosed within their organization based on individual roles and other factors.
Lever #6: How You Compete
How you compete in your market will generally drive where your organization’s energy and resources are directed. Is your focus on internal improvement, or do you look externally to find new customer insights and ways to differentiate from competitors?
This lever can also influence how you differentiate yourself from competitors, such as focusing more on service or cost, or on achieving market share dominance as opposed to measuring success based on the value delivered to customers. Such considerations can ultimately determine how you acquire and retain customers — will you rely on reputation and market share, or continual adaptation to the market?
Different strategies may be more or less appropriate at different stages of growth.
Lever #7: How You Learn
How an organization learns is key to achieving desired outcomes. Leaders must find the right balance between action and analysis. Both reflecting on past efforts and their consequences, as well as repeating activities to continuously improve through trial and error, can be necessary at times.
This also influences an organization’s preferred method of learning. Does your organization encourage replicating proven solutions and methods, or is experimentation and challenging the status quo encouraged? Is your team’s source of knowledge the precedence of history and cumulative knowledge, or is it based on inquiry, where team members are encouraged to be curious and ask “what if?”
The right balance will likely depend on the task being performed, as well as the capabilities of the individuals involved.
Lever #8: How You Change
Finally, leaders should always be mindful of how their organization approaches change. Some react to significant events as their impetus for change (such as when performance levels decline), while others initiate change in anticipation of new events or from a desire to further improve effectiveness.
The target/scope of the change may also vary in different circumstances. The scope could be singular, focused on a specific area or on achieving incremental change, or it could be integrated across the organization as a whole, with widespread participation and ownership encouraged.
Finally, how your organization implements change will drive outcomes. Some leaders use a designed implementation with feedback loops and modeled behaviors after multiple constituencies plan and coordinate change initiatives. Other organizations prefer a more emergent approach that learns from challenges that come along the way as change is implemented.
Levers for Success
As noted earlier, there is no one size fits all definition on how your business should approach the different levers of organizational culture. What truly matters is that you take the time to evaluate where your organization currently stands, and whether this is contributing to or detracting from your desired culture and aspirations for the company as a whole.
By using these levers of organizational culture to identify areas of improvement for your business, achieving the “right” culture for your team will be within reach.
Reprinted with permission from Forbes.
