Example 1
An advisory firm wants to be able to offer the same cutting edge, highly profitable solutions that its competitors offer. In order to do this, different departments must cooperate very closely to create multi-disciplinary working groups. However, its departments currently have a competitive relationship. Each department works within its own silo and jealously guards its own clients as it tries to out-perform other departments.
The only way for this firm to be able to keep up with the competition and to offer higher margin products is to change its culture to break down silos and to get teams to work together.
This is a cultural issue. The corporate culture (and the cultures of the relevant teams) must be changed to encourage cooperation.
There are a number of ways of doing this.
Culture can be changed by management edict declaring that the teams must cooperate and that it will considered a serious offence to withhold cooperation. This is probably the least effective method and is likely to meet resistance.
Culture can be changed by example, with team leaders modelling the cooperative behaviour that they wish their teams to adopt. To be effective this must be done sincerely and consistently, with team leaders explaining to their team members why they changed their behaviour.
Culture change can be achieved by changing internal structures or procedures in a way that forces the teams to cooperate. Again, this is likely to meet resistance unless it is accompanied by a “hearts and minds” campaign to change attitudes.
Culture change can be attempted by changing the reward structure to encourage cooperation. This is not as powerful as people often assume, particularly when the habits and attitudes that you are trying to achieve are deeply ingrained.
Finally, culture can be changed through persuading people that it is in their own best interests and the best interests of the firm to change. This can be powerful when a strong case for change can be made, but again it is difficult to overcome resistance when habits and attitudes are ingrained.
Example 2
A regulated entity such as a bank may put itself at greater risk of compliance and regulatory problems if people think that it is someone else’s job to think about regulatory and compliance issues.
Fostering a culture in which everyone, no matter what their position in the company, feels a responsibility for spotting regulatory and compliance risks and taking appropriate action significantly reduces the firm’s overall risk.
This can be achieved in similar ways to those given for Example 1.
Example 3
An organisation with a strategy based around customer service can improve its performance and build a lasting competitive advantage by building a culture that supports this. This means a culture in which everyone in the company (including those in operations and other support functions) is dedicated to meeting the needs of customers. People would be empowered to depart from normal procedures where appropriate in order to provide exceptional customer service.
That may require a change of culture if the current corporate culture puts a greater emphasis on following processes and procedures than on providing customers with the very best levels of service. The good judgement required to know when that is appropriate also needs to be part of the culture.
Such cultures are usually built over time, with newer members of staff learning from stories and from long serving members of staff.
In summary, a culture can be used to achieve better results by encouraging or discouraging certain attitudes and behaviours. It can also be used to get the very best out of people. An effective culture promotes and supports your professionals and sets up the conditions in which they will produce their best work.
More information on our culture management system can be found here.
