Aligning your company’s culture to accelerate its performance Featured

8:00pm EDT October 26, 2010

A sound business plan is like a road map to the land of high performance. Informed executives know a secret: The road, as the map might suggest, isn’t flat; the topography of the journey from here to there has to be carefully managed. In the business world we call that topography culture. Unless business leaders take decisive action to align their company’s culture with its strategy, that culture can actually undermine the journey. Will your culture be a roadblock or an escort? Will it hinder or accelerate your journey to high performance?

It is natural for leaders to focus on the financial and operational aspects of managing their business. Unfortunately, in many organizations leaders passively allow company culture to evolve on its own — they don’t make sure the culture lines up to support achievement of the strategy. Executives of high-performing companies don’t rely on fate or human resources to achieve alignment. They create a competitive advantage by ensuring that people and functions work together toward a common purpose. In short, they guide culture.

“As organizations grow and change it’s easy to lose sight of the importance of the shared values and behaviors that underpin the execution of strategy,” says Joseph Dettmann, senior consultant in Towers Watson’s Organizational Surveys & Insights Practice. “Executives often assume that the culture will work naturally in their favor, but without the right guidance, values can be misplaced and the wrong behaviors reinforced, preventing a company from delivering on its strategy priorities.”

Smart Business spoke with Dettmann about the steps executives should take to achieve cultural alignment.

How can executives initiate the cultural alignment process?

First, take a snapshot of your organization’s current culture by defining its attributes. Start with your leadership team. Culture isn’t as soft or illusive as it seems. It can be measured reliably. Towers Watson has spent the last decade working with top-performing companies to define and validate the cultural attributes that underpin achievement of different strategies. It’s actually very clear what needs to be present for employees to be innovative, to be efficient and carefully manage costs, to deliver high-quality products to market, to have a strong customer orientation, and to build a strong brand/image from the inside (from employees) out (to the market).

From research and practice, clear attributes have emerged that serve as the foundation for a concise culture-strategy alignment assessment: The Cultural Alignment Tool. Leaders sort cultural attributes that most reflect their company’s current state, and then sort again to build a future state, selecting those attributes they believe are needed to deliver on the strategy. We evaluate the current and future states against the profiles of high-performing innovators, models of efficiency, customer-centric businesses, etc. By doing this we clarify the aspects of culture that are working in the company’s favor to be leveraged, and pinpoint the cultural barriers that will need to be torn down to get from here to high performance.

There are different paths to success, but they all start with careful measurement and a clear road map. Collectively, company executives need to build a framework for success by deciding which aspects of culture will work in their environment to create a competitive advantage. We have found that high performers tend to focus on one or two primary strategic priorities, like quality or brand recognition, and they align their culture to support them. Executives become clear on gaps between the current and future cultures and their teams drive focused actions to close those gaps.

Of course, business leaders should resist the temptation to take actions based upon anecdotal beliefs, because there actually is hard science behind the defining and shaping of corporate culture. Over the years we have collected best practices from organizations who have successfully built alignment, and who because of it have been better able to execute on their strategies and financially outperform their peers. When it comes to taking focused action, there is no need to reinvent the wheel — we provide a library of best-practice actions to drive cultural alignment. Others have done the work and learned the hard lessons; leverage that to your advantage by using a smart resource like this.

Should employees — not just leaders — be involved in the change process?

Yes. It’s important to test the current cultural alignment and employees’ readiness for change by conducting a broader work force survey. You might already have an employee survey. If you do, make sure it is about more than just satisfaction or engagement; make sure it measures and helps to truly deliver alignment. The results will confirm or dispute leaders’ conclusions about the environment and reinforce or suggest new actions that will be most effective in lining the culture up for success. Executives can also use the information to establish a baseline and compare employees against those in high-performing organizations.

What should leaders focus on to drive change?

Here are a few things to keep in mind when driving cultural alignment:

  • Measure first — then take the right, focused action.
  • Be a senior champion — alignment starts and is reinforced at the top.
  • Involve all levels of leadership — real change happens grass roots.
  • Don’t manage cultural change as a project — it must permeate everyday work life.
  • Monitor progress — celebrate and course-correct when necessary.

Joseph Dettmann, Ph.D., is a senior consultant in Towers Watson’s Organizational Surveys & Insights Practice. Reach him at joe.dettmann@towerswatson.com or (415) 836-1029.