This guest post is by Ann Rhoades, author of “Built on Values: Creating an Enviable Culture that Outperforms the Competition,” and president of People Ink, a culture-change consulting firm. She was also a founding executive of JetBlue. Follow her on Twitter @Peopleink.
Just by looking at the behavior of leaders, you can tell what the values of a company really are. And all too often, those lived values bear almost no resemblance to the stated values — those lofty statements painted on the walls or sanctified in a mission statement. Many leaders want to believe that all they need to do is proclaim a set of values, and culture will magically change, but that does nothing to retool the actual values that inspire the day-to-day actions of employees on the front line.
The key is identifying your best employees – your “A Players” – and spread their values throughout the organization by hiring people who share those values and motivating all employees to live those values every day. We call this the “Values Blueprint” method of changing culture. Single departments and workgroups can also use this to create islands of excellence, even if top leaders are not ready to buy in.
I have found that five fundamental principles inform every successful values-based culture change:
- You can’t force culture. You can only create environment. A culture is the culmination of the leadership, values, language, people processes, rules and other conditions, good or bad, within the organization. However, leaders cannot “create culture change,” even if it is badly needed; they can only create the right conditions for it to arise.
- You are on the outside what you are on the inside. What many leaders don’t understand, except perhaps intellectually, is that you cannot create a great customer service organization if you treat employees badly. You can’t force people to smile and treat customers well, especially when they feel ill-used themselves. Not surprisingly, those organizations that do customer service best also treat their employees best.
- Success is doing the right things the right way. One of the best reasons for redefining corporate values is that well-defined values can help you — and your employees — make better decisions. In values-rich companies, most decisions about customer service can be made by front-line employees. A win there is a happy customer who did not have to speak to a supervisor. By defining your values and the behaviors based on them, you also simplify the task of day-to-day decision-making: “Does that make sense in light of our values?” is all you or your employees have to ask yourselves.
- People do exactly what they are incented to do. Your values will be perceived as hollow and meaningless unless you base compensation and rewards on expressions of the behaviors that go along with the values. Hiring methods, too, must be revised to select people who already possess the values important to you. You must be courageous enough to fire those who don’t. Even long-time employees. Even executives. Otherwise, they will render your ideal culture impossible.
- Input = Output. Organizations will only get out of something what they are willing to put into it. Values maintenance — what we call continuous improvement — is as important as values creation. In other words, you are never fully “done” with culture change; you must be vigilant that no one backslides into old ways.
The results you want can be built on shared, strategic values and financial responsibility. Companies can do worse than emulate JetBlue and Southwest. Both companies have achieved strong financial results because we created values-rich cultures that encouraged all employees to contribute to their financial success — and have fun.
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Well written and to-the-point. Now let me add a bit.
You mention incentives, and I can't agree more. Rewards, especially well-publicized ones which the employees value, can do wonders. It's been said "past behavior predicts future behavior" and this holds true for the recipients, but also others who have observed those recipients. Role modeling happens all around us, and we need to pay attention and advertise it when it's done well.
Make sure it is obvious which values are being rewarded, what specific behaviors were practiced, and outcomes achieved. "Good job" recognition, lacking specifics about WHAT was done well, could leave employees wondering "What was THAT all about?" reducing the positive domino effect you might desire.
One more comment: keep the corporate values limited to the critical few. I've worked with and seen values lists range in length from a minimum of 3, to an extensive list of 16. Compare your list to the "average" number of items or thoughts a human can remember and recall quickly and easily: usually 7 +/- 2. This helps make it easier to focus on the critical few and not the overwhelming many. We can do several of them very well, but are more likely to struggle and juggle with too many. A smaller list also reduces the likelihood that values will conflict with each other, like quality versus quantity.
Well done. I agree that you can't force culture. I've seen companies where about 90% of senior leadership team has been replaced, yet the culture remained the same. And I've seen companies that have tried to "borrow" culture from other successful organizations and theirs stays the same. Culture needs to be organic… (duh!) and it needs to be heartfelt. Anything less is inauthentic and won't produce the results you want.
Thank you for this article. I am currently a student at Roosevelt University gaining my Masters in Human Performance Improvement. I am very intrigued with corporate culture and the significant impact it has on performance. Too many times what is touted as important to the company/culture is not what is rewarded. Too often it tends to be the squeaky wheel that is rewarded and not the true values.
I found it interesting that to create culture you mention finding the a-players and spread their values. Is it possible to bring in new management and their values to create a new culture? Can culture really be created from the bottom up?
I do agree that authenticity is the key.
Andrea
Culture is designed hopefully by all levels of the organization collectively. it is driven by the leaders and their behaviors. it becomes the operating culture when all levels of the org participates. some of the best i have seen were those where it became so consistant that people coming in (including leaders) did not feel comfortable when their behaviors did not mirror those of the organization…..
my best
Ann
To answer Andrea's question "can culter be created from teh bottom up?" I think the answer is that is the only way culture is created. To the point of the article, leadership create the environment for the culture to change. If the employees buy-in to the environment, then the culture will begin to change slowly. Once they see that there is a benefit to them in their day-to-day work or compensation (less stress more pay), then it will take hold and gain momentum. Eventually, the change in culture will take you to new levels of excellence. Conversely, if you create the culture for negative changes in culture, you will find that the employees will take you there even more quickly.
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Couldn’t agree more, Ann.
I’ve written elsewhere, “The missing, but critical, point to understand is that values and culture are inextricably intertwined. The problem arises when a company has its STATED values (on a plaque on the wall, coffee mugs, ID badges) that are entirely different from the demonstrated and TOLERATED values. Regardless of the STATED values, it’s the TOLERATED values around which the culture is formed. ” (That post can be found in full here: http://blog.globoforce.com/2010/06/corporate-cult….
You are exactly correct that people will do what they are incented to do. That's why we are such proponents of Strategic Employee Recognition — structuring your recognition and rewards program such that:
1) Every recognition given is linked tightly (and with a detailed message about how and why) to a company value demonstrated. "Ann, great job on the MacGuffin project. The way you rallied everyone from multiple parts of the organization to pull together a comprehensive, detailed response embodies what we mean by 'Teamwork.' I'm sure your efforts will be the linchpin to our winning this business."
2) Such recognition is given frequently — it doesn't do Ann any good to be reminded of her achievement a year later in her performance review or at the annual banquet if she barely remembers the MacGuffin project. If your goal is to encourage frequent repetition of such actions — make it memorable in the moment!
3) Such recognition is given to 80-90% of employees, not just the top 10% of elite — Far more than your top 10% are working hard every day to deliver the results you need. You must encourage all of them to repeat the actions and behaviors you've defined as necessary for success.
I write much more about our approach in our book Winning with a Culture of Recognition, including multiple case studies and myth busters. I think you might enjoy it: http://www.recognitionculture.com
Well put, Ann. I work for a company that lives by these guidelines, and for the first time in my career, I truly feel happy, and more importantly, loyal to the organization. We hire based on our company's values because we learned, no matter how hard you try, you cannot change a person's values to fit yours. The better your people mesh with your corporate values, the better they will fit in, and the happier they will be.
Also, little thing in your first paragraph: 'culmination' means the end, not a grouping together.
Rodger
Could not agree more with your comments. Hiring is critical around values. so many companies forget that portion of the
interview!!! we can find or hire to competencies but if we fail to include Values we will not be successful in our hiring….
Here's a challenge: Instead of focusing on outputs, focus on outcomes. It's more than data – it's about who is being affected, why, what the end result is, etc. It's not just about numbers.
All great pieces of advice!
Kirk Baumann http://www.campus-to-career.com
Marvelous article Ann, thanks so much for sharing your perspective! Culture truly is a “lagging” indicator of a company’s health, and all the mission/vision statements in the world aren’t worth a penny if employees from the C-suite to the warehouse floor don’t walk the talk. When my kids were much younger I’d send them to bed with the admonition to “go to sleep!” not realizing that I couldn’t control that anymore than I can control the weather. Now I say “good dreams!” and we both end the evening with smiles on our faces. That’s a culture shift ih a sense too, recognizing what you can and cannot control, and building a foundation of trust based on everyone knowing what’s right for them personally, and for the greater good.