Abstract profile of human face looking to the viewers right.

Culture Transformation: Critical Success Factors

Contact: David M. Lynn, Gerard F. McDonough

January 20, 2021

What differentiates the most successful culture change initiatives from the failures? Based on work with scores of organizations, we have found the most successful culture shaping initiatives achieve these success factors:

  1. Define your Future Culture in terms of your organization’s strategy and outcomes. Culture change is often characterized by too much philosophy and too little clarity. Culture is more than an effort to “continuously improve the workplace” as some try to “live our values”, though these are essential. The question is, “What culture is required for successful execution of our strategy?” The are many legitimate reasons to care about culture; a compelling culture is appealing for everyone and contributes to well-being, employee engagement and the ability to attract top talent, for example. But these may not, in themselves, be reasons enough to take it on. In the end, we ask our clients to care about culture only because it drives strategy execution and business outcomes. Executives must be involved in defining the Future State culture in terms of what will support the execution of their business strategy.
  2. Define culture in terms of the behaviors you want to encourage. Organizational culture is complex. It’s such a big topic that seemingly everything affects, and is affected by, it. Related to the factor above, it is critical that culture be defined in terms of behaviors. There is more than one way to define culture, but to make the most progress the fastest, take a behavioral view. The question that everyone in your organization shares, whether consciously or not, is, “What behaviors does it take to survive, thrive and fit in around here?” Culture can be seen as the symphony (or cacophony) of voices “spoken” through senior leaders’ behavior as well as through the myriad policies, processes, structures and systems (e.g. the performance management system or typical processes for making decisions) that employees hear every day. They all serve to define and reinforce the behaviors required for success. Are they the behaviors you need for successful execution of culture? How do you know?
  3. Make a clear and compelling business case. The jury is in regarding culture’s role in driving outcomes. Culture is not just an enabler. It is, in fact, essential to the successful execution of strategy. There is also growing clarity about which cultural characteristics are most associated with these outcomes. We have found that many (but not all) executives theoretically agree with these statements. But even those who agree may lose their conviction without compelling evidence. And the depth of their conviction will largely determine an organization’s success. This evidence exists. This case can be made more convincingly now than at any time in the past.
  4. Directly and vigorously engage the Executive Team. Success in culture change requires the informed commitment of the executive team. This may seem obvious as this is true of most important initiatives. But we have seen, far too often, forward thinking human resources executives try to tackle substantive culture change with only tacit “approval” for doing so. Culture shaping requires changing leadership behavior, often profoundly, at the top of the organization. If executives think this is a “program” or “an HR thing” your impact will be minimal. Also, executives must demonstrate they are unwavering in their commitment to changing the culture. They must be clear and consistent in their messaging about both why the culture must change as well as to what it is changing.
  5. Bring data. Armed with strong executive commitment, the question becomes what, specifically, to change. If everything affects culture, what will make the biggest impact the fastest? This is where culture measurement should contribute. And not all culture measures are designed to deliver on this. Most reputable culture measurement systems can help you understand what type of culture you have and can also help you define the culture you need. But most cannot tell you, with any depth or reliability, what to do about it. Select a culture measurement system designed to do so, one that can help you make the business case, as well as point the way to the changes that must be made.
  6. Think big and act fast. Your task is not only to promote or instill the preferred Future culture, it is also to defeat the existing one. You will meet with all kinds of resistance, even from well-meaning employees and leaders who understand the limitations of the existing culture. Their reactions will range from strong support, through tacit resistance to outright sabotage. Small, incremental measures are the easiest to resist. For example, if your culture is too bureaucratic, as so many are, the bureaucracy will find a way to survive small efforts to change it. The culture plan (yes, you need a Plan) should be built upon the data (see above) that reveals the most significant barriers to realizing the Preferred Future culture. It is far easier to take aggressive action when your action is focused on the highest priority issues. If the data reveal that you must move decision making downward, then you need an aggressive plan for doing so.
  7. Involve everyone. There will be a temptation to hold the culture data (which is often unsettling) close to the vest and to treat the culture change as primarily a top/down initiative. To be sure, culture change cannot be an entirely democratic process. Some decisions will be difficult and must be driven deep into the organization whether people “like” it or not. But it is a mistake to use only older, autocratic methods (which represent the “old” culture) when trying to bring about a more contemporary and sustainable one. In short, it is critical that people at all levels are asked for their feedback and guidance throughout the process.

“Culture Transformation: Critical Success Factors,” Ankura Consulting, 01/20/2021; Lynn, David L.; McDonough, Gerard F.