Organisational Culture
There are many definitions of Organisational Culture, but one of the simplest and the one I like the best is that “culture is a set of shared norms in an organisation, a generally unwritten consensus about behaviour and how things get done.”
There are so many definitions of culture because it is complex and hard to quantify. It has links to values, integrity, shared purpose and how people interrelate with one another, both within an organisation and externally with customers, suppliers and other parties. In some ways, it forms part of an organisation’s brand because it influences how customers and other external parties are dealt with.
Irrespective of how we define organisational culture, the reality is that Boards are increasingly being seen as responsible for setting organisational culture. Rightly so in my view, because the best leaders, lead by example. They set the standard.
The following statement might seem a little out of place here, but I’d like you to think about it whilst you are reading the remainder of this section/page. Boards who are not insisting on receiving regular employee survey results are failing to manage culture and in their duties. Employee surveys will not give you a precise measure of culture, but they will give you an indication of some of the influencing factors.
The common “A fish rots from the head” metaphor implies that the cause of problems and improprieties within an organisation stems from leadership. It is often used to describe political parties, companies, public sector organisations, not-for-profits, etc, where improprieties have come to the attention of regulatory authorities and/or the public.
The implication is that there has been a failure of leadership, which has led to the problems.
The Fish Rots from the Head is also the name of a book by Bob Garratt that discusses corporate governance. The book is intended to help readers develop the skills and practices needed for effective corporate governance
The obvious question is: how do you create or change a culture?
The reality is, that it’s not an easy task, but if you don’t manage the culture of your organisation in all likelihood you will end up with the sort of culture you don’t want.
If you are starting a new business, then your task might be a little easier, but you may not always have the blank sheet you think you have. New employees will bring remnants of previous cultures they have worked in with them. It’s a tangential issue, but that’s why it’s so important to have induction programs that talk about “the way we do things around here.”
Many years ago, as a middle-level manager, I was involved in bringing some Customer Service Engineers on board at Digital Equipment Corporation (DEC) following our acquisition of the Philips banking technology business. The culture of the two organisations couldn’t have been more different. Whereas the Philips Service Engineers were all members of their Union and it was a them and us attitude between them and their management, the DEC culture was one of shared purpose and working together to achieve the best outcomes for our customers. Over time, I managed to convince the new Engineers I had working for me that I wasn’t the enemy. The Union wanted to hold a lunchtime meeting for the existing Engineers they’d discovered worked at DEC, but weren’t members. I was happy to arrange it, and the Union was terribly disappointed when nobody turned up. I’m not saying for one moment that people shouldn’t be part of their Union; in fact, I was a shop Steward for a short time in the 1970s. What I am saying is that when the culture is right in the workplace and people feel like they are part of an organisation with integrity and purpose and they feel that they are respected and appreciated, all sorts of good things start to happen. They are more loyal, thus reducing staff turnover and associated costs. They take pride in their work and talk with pride about who they work for.
The stark truth is that 70 to 80% of cultural change programs fail. There are many reasons for that, not least of which is that whilst organisations and executives might recognise the need for change, they are rarely clear about what they want to change into. So, what often happens is some Cultural Change Consultants are engaged to run a few workshops, which those who attend find a nice break from their daily routine. The workshop group as a whole might agree to do things differently and attendees may make pledges in line with that. Then everyone goes back to work after the first, second or third costly workshop is over. Life and work simply return to the way it was before. The attitudes, behaviours, processes and procedures remain unchanged. Within a month or two the workshops are forgotten and the finance department can look back at how much the whole exercise cost. Culture is incredibly difficult and time-consuming to change, but it can be done if you know what type of culture you are trying to create and are prepared to put in the time and effort.