JOHN CHILDRESS

In 1978 John co-founded The Senn-Delaney Leadership Consulting Group, the first international consulting firm to focus exclusively on culture change, leadership development and senior team alignment. Between 1978 and 2000 he served as its President and CEO and guided the international expansion of the company.

Fundamental Principles of Corporate Culture

Culture is an outcome. Much like profit is an outcome of various business actions, like cost reduction, pricing strategies and revenue growth, corporate culture is the outcome of multiple organization drivers. The only way to really understand or shape culture is to determine your specific drivers, and in each company some drivers are more impactful than others.

Corporate culture is a set of commonly used behaviors, and culture change is essentially behavior change. The conventional definition of corporate culture, “the way we do things around here”, refers to the frequent behaviors employees use to interact with each other, to approach business issues and change, and how they treat customers.  Management may define certain corporate values as being important, but it is behaviors that determine a culture, not value statements or PowerPoint decks.

Culture Change is the replacement of one set of habitual work behaviors for a more effective set of behaviors.

Every organization has a culture.  Large or small, start-up or mature, commercial or governmental agency, every organization has a culture.  Culture is either designed from the beginning or left to develop by default. Either way, you will have a corporate culture.

Culture impacts performance, either positively or negatively. But figuring out exactly how is often extremely difficult. Not all elements of culture have the same impact on performance. Don’t believe in averages, which most culture surveys are based on. 

Leadership Required. If leadership doesn’t guide and manage their culture, it tends to fractionate into strong subcultures, many of which may not align well with the overall business and strategic objectives. Most senior executives have no clue about the subcultures inside their company or their impact on performance and yet are frustrated and confused as to why the execution of business initiatives falls short. 

Influence of the Founders. The values, beliefs, behaviors and work habits of the founders and the senior leaders have a strong influence on the culture in the early start-up years. Over time, as the organization grows larger and more and more employees are hired from other companies and national cultures, peer pressure and subcultures become increasingly dominant in determining the actual corporate culture. Corporate Culture works on human logic, not business logic. The fact is, in most organizations employees have more trust in and take their clues on what is important and how to behave from peers and informal group leaders, than senior management. Upper management may set policies, but policies aren’t culture. How policies are interpreted and the behaviors they drive, that’s culture. 

You get the culture you ignore.  Since culture reveals itself as habitual behaviors, if managers don’t intervene and coach peers and employees when they see inappropriate behaviors, these will become the norm; the “way we do things around here”. Every workday is filled with ‘coachable moments’ to help build and sustain a strong and aligned culture.

Acculturation. People don’t change their core personal values when they enter your company, but they can and do change their ways of thinking and workplace behaviors to match the existing culture.  It’s called “acculturation” and is based on the very real human social need to fit in.

Culture Assessments can never measure the ‘real’ culture, only an approximation. Culture is more easily seen and understood by identifying the habitual behaviors, subcultures, workplace rituals and internal policies. Policies and work processes are extremely strong determinants of corporate culture, because they ingrain repetitive behaviors.

There is no perfect corporate culture. A high-performance culture is one which best matches the business strategy and the needs of employees. Weak, dysfunctional cultures are usually the result of strong subcultures with little alignment to the overall business strategy.

Culture is not static or permanent; it evolves or drifts over time and without active management will usually drift in a nonproductive direction.

A strong culture won’t make up for a poor strategy, and a great strategy can’t be delivered by a weak culture.

A bad leader can ruin a good culture faster than a good leader can turnaround a bad culture. 

Consultants don’t change cultures, leaders and employees do.

Understand the Levers for reshaping corporate culture.  Basically there are five major drivers of culture: Industry dynamics, Leadership behavior, Subcultures, Stories and Shared Beliefs, and Internal Policies, Systems and Work Processes.  Each of these five major drivers work together in shaping your current corporate culture.  And they are the most effective levers for reshaping culture.