Karian and box thinkbites - Q1 2016

edition two: Q1 2016

PROVOKING THOUGHT GENERATING DISCUSSION ENGAGING EMPLOYEES DELIVERING RESULTS

the culture issue

A company culture is often buried so deeply inside rituals, assumptions, attitudes, and values that it becomes transparent to our organisation’s members only when, for some reason, it changes Professor Rob Goffee, ‘Why should anyone be led by you?’ 2006

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edition two: Q1 2016

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n the corporate world, ‘culture’ has become one of those words. Like ‘brand’, it comes freighted with the baggage of bullshit bingo: everyone has heard their CEO spout evasive corporate-speak about becoming more ‘values-led’, or suffered the pseudobabble of ‘specialists in the field’.

Nevertheless, the history of the word itself reveals a quite different tradition.

‘Culture’ was first applied to describe the specific values and behaviours dominant in a corporate organisation by the Academic Management Journal in 1966, under the influence of academic anthropology. It is this history – of alert observation and rigorous analysis – which we want to evoke in this culture issue of thinkBites. What is the personality of your business? What is the invisible web that connects your employees, your values and behaviours, your customers, and, above all, affects your business performance?

Produced by Karian and Box Ltd 1st Floor, 22 Lendal, York, YO1 8AA 01904 654454 info@karianandbox.com www.karianandbox.com Editorial Team:

Design Team:

Paul Jones Rachel Gartner Matt Midgley Myriam Day Jenny Hill

Ed Clews

These questions are more essential now than ever. In times of challenging markets, values come under pressure in the battle for better performance.

The effects are clear to see: in the last year leading brands have seen huge reputational challenges because of unethical decision-making; both Tesco and Toshiba have been caught out by accounting scandals. Unimpressed customers are voting with their feet – and regulators are making cultural audits a legal requirement for the financial sector and beyond.

However, corruption is not the only cultural concern businesses face. McDonald’s hit the news this summer because its business underperformance was linked directly to what the Guardian called a ‘dinosaur’ culture at board level, stifling innovation. Fear of ‘speaking truth to power’ will not just lead to ethical drift and scandal but also to a stagnant culture, where talent and ideas are squandered.

Read on to explore our take on the culture issue. In our leader, I get to the heart of why measuring culture matters in today’s context of market challenges and regulatory change (p.4). Paul Jones looks at the complex nature of culture and gives practical suggestions for measuring it (p.8).

Jenny Hill channels the spirit of the corporate anthropologist and interprets the totemic moments which signal – to colleagues and consumers alike – what an organisation is really like (p.10).

Finally, Myriam Day picks through the on-trend world of startup culture to identify how you can take the best of their smart thinking and apply it to your culture (p.12).

As ever, this edition reflects the conversations we’re currently having and we’d love to hear your views on these issues. You can get in touch with any of our writers directly or come and check out our blog at blog.karianandbox.com.

Ghassan Karian – thinkBites editor

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The leader

Limited speak-up culture stifling innovation

Risky decision-making jeopardising reputation

Measuring culture: why, what, how Diagnosing the broken bones you can’t see There are three core reasons why businesses and their leaders feel it’s imperative to understand what makes up their culture Some now see it as necessary to respond to regulatory or external pressure to assess how people behave and the driving forces influencing how an organisation works. This is especially the case in financial services where, both in the USA and UK, regulators now require organisations to ‘audit’ their culture and assess the risks affecting market integrity and/or the impact of cultural trends on customers.

Some businesses, looking to change their culture, need a clear picture of where they are now and how well they are doing on the transformation journey.

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Finally, some understand the powerful role that their people’s culture and behaviours play Ghassan Karian in securing business goals. They know that ghassan.karian measuring culture is not an abstract exercise. @karianandbox.com It has to be about measuring whether their culture is enabling effective contribution to the success of the business strategy. And what ‘broken bones’ are holding the organisation back.

Of course, none of these are mutually exclusive, but it is important to know what drives the requirement to measure your culture. But it is the third reason which is the most potent and can have the most transformative impact on business success.

The leader

“Culture does not change because we desire to change it. Culture changes when the organisation is transformed – the culture reflects the realities of people working together every day” Frances Hesselbein, former CEO of the Girl Scouts of the USA

TEDx

Once you’re clear on why you’re measuring your culture, there are two fundamental principles which allow organisations to secure necessary value from measuring their culture. They are not mutually exclusive and, taken together, provide a clear focus for what a culture is and how it is measured.

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Measuring culture should contribute to securing your business strategy Ultimately, any attempt at measuring your culture should have business strategy success as the fundamental principle for doing so.

Otherwise, it is simply about focusing on the ‘means’ rather than the ‘ends’. In other words, the pertinent question becomes: do you have a culture which encourages people to perform at their best in order to achieve their potential and to contribute to securing your business priorities?

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You need to know where you are headed Do you know exactly what culture will enable employees to contribute to better business performance?

Being clear on the desired culture – where you want to get to as an organisation – will help you shape the right approach for measuring where you are now, and how far you are on the journey towards your target destination.

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How to...

A step-by-step guide for measuring organisational culture

Whatever your motivation for measuring your organisation’s culture – whether you have to in reaction to external regulatory pressures, or you want to identify the cultural levers that sustain high performance – capturing your culture is the first step in any programme that aims to direct your organisation towards the right destination.

No one survey or research approach provides a holistic picture of your culture. An organisation’s culture is a complex, ever-shifting jigsaw made up of a range of components. Lots of models by academic institutions and cultural consultants/analysts exist to help businesses map this picture.

You only have to Google ‘organisational culture analysis’ and you’ll be inundated with lots of approaches and models which state that they are the most accurate measure of organisational culture. None of them are wrong, and many of them are mostly right. The difficulty is that many look at it from different perspectives. And the challenge you have is whether any of these models help you see the whole picture.

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The visual on p.7 draws together key components of a range of models that measure culture. Assessing each of these components will enable you to see the whole picture and not just parts of it.

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Using integrated quantitative and qualitative research will help create a detailed picture of the current and desired values and behaviours across your organisation – and how they connect with people’s personal values.

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This analysis can be used to engage stakeholder groups at all levels to articulate desired culture – with a focus on the levers which drive better business performance, and how culture is at the heart of your shared identity and purpose as an organisation.

Five examples of how you can assess the different components of your organisation’s cultural jigsaw are outlined below.

Interviews with key leaders, stakeholders and influencers will help define the desired state you are moving towards. Together with the formal statements made by the business on what its values and desired workplace behaviours should be, the understanding gained from interviews forms the destination culture your organisation is aiming for. This insight enables you to create target metrics against which your measures of existing culture can be compared.

Looking at the business (yes, ‘looking’ at it) can tell you a lot about what it says about itself, what is important and how people should behave. Visible icons and symbols help signal the nature of the organisation – its branding, dress (both what people wear and how their workplace environment looks), and the public statements or imagery used to reinforce key business messages.

A core part of any cultural analytics is how people view the dominant behaviours and ways of working they see around them. Using crisp, simple questions, you can obtain quantitative and qualitative feedback which enables you to measure the way the culture ‘feels’ to people in their everyday work.

Qualitative analytics of the millions of emails in your organisation’s systems can help define the dominant language used to describe how people interact with each other, together with the behaviours and attitudes that are most in evidence when people are ‘on the job’.

Understanding the culture gap • All of the analysis that can be conducted will tell you what the culture is like now. Mapped against a desired state, an organisation can see to what extent, where and how it falls short of the stated aspiration.

• Mapping the desired state against the current experience of the organisation’s culture at every stage of the employee lifecycle is key. For example, what do people hear, see and experience in the recruitment and induction processes which signal the culture of the organisation?

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How to...

Culture is not just how people behave. It is shaped and reinforced by workplace systems, policies and procedures, which are critical in driving particular behavioural norms. The way people are inducted, performance managed and recognised/rewarded, alongside security, health and wellbeing and other ‘rules’, gives people clear signals about what to do or not to do.

Assessment of what these systems tell people and how they reinforce particular behaviours is critical.

How to...

Not one culture, but many...

Culture is tricky. It’s dynamic, heterogeneous, but, above all, it’s very personal.

Paul Jones paul.jones@ karianandbox.com

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‘Values’ are not just abstract business priorities determined by market necessity; they are what you hold most dear, what defines you as a human being.

And that means it sometimes feels as though there are as many values and behaviours as there are types of people in the world. Using the right tools to understand and anatomise this diversity within your organisation is key to developing the

right kind of integrated, targeted action that will really have an impact – and deliver the return on investment that the business rightly demands. Of course, organisational diversity is entirely natural and no bad thing – the next challenge after pinpointing who these cultural tribes are in your organisation and where they sit is creating a culture that unites their best attributes with your business strategy and direction.

Defining the cultural tribes that exist in your organisation Culture is often talked about in monolithic terms, as if every single part of the organisation shares the same set of values and behaviours. But for large businesses this is usually much more of an aspiration than a reality.

Segmentation analysis offers a sophisticated and incisive way to correlate employees’ values with demographics and engagement.

Unlike the segmentation a supermarket will undertake on its current and potential customers, an organisation cannot mailshot and target specific individuals based on their segment.

That would break many bonds of trust among employer and employee, if not data protection laws.

However, this kind of behavioural segmentation has been used by some organisations to successfully shape policies and leadership action on, say, talent attraction and retention as well as performance management.

By knowing that one part of a business has more than one type of culture, a leadership team can focus their actions in a way that is more likely to elicit the right response from specific population groups.

Disenchanted Team Players

Neglected Supporters

Disengaged Potentials

9%

4%

Engaged Champions

16%

How to...

Not only can you see what defines employee clusters but also where they sit in terms of business area, grade, gender and length of service, allowing you to target action effectively.

An organisation’s culture is often made up of a range of employee segments — ­ with each having common characteristics, demographics, outlooks and behaviours.

10% 24% 23% 14% Constrained Professionals

Sensitive Performers Committed Contributors

Understanding how personality types are driving your culture Culture is set by the tone at the top, and often the personality of individual leaders is critical in determining what is established within a business as ‘the way we do things here’. Personality profiling can help leaders explore how their unconscious tendencies and actions are driving culture and behaviour in their business areas. There are many tools enablig this kind of insight, including Professor Roger Steare’s MoralDNA, the approach taken by Barrett Values Centre, insights profiling or even the traditional Myers-Briggs test with its personality framework inspired by the renowned twentiethcentury psychotherapist, Carl Jung.

Organisations often already hold this kind of data on many of their employees – and almost certainly most of those in management or leadership positions. Correlating these data against values can add a personal dimension to segmentation analysis, enabling you to cluster personality types with cultural tribes and demographic groups.

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Symbols of culture If a picture is worth a thousand words then a symbol is worth a million.

And action, especially by leaders, is the most powerful determinant of cultural change.

Carefully edited values statements and infectious buzzwords are meaningless. It’s the everyday actions and silent behaviour that really tells you about the culture of a company and whether it matches what it says on the tin.

Corporate anthropology

Culture is about more than making your office open plan or allowing people to wear jeans on Fridays. Take a look at the symbols of culture in action across other organisations as inspiration.

Jenny Hill jenny.hill@ karianandbox.com

Empowerment Bureaucracy, red-tape and a decision-bycommittee culture are easy to spot. Cutting through the noise and empowering people to simplify decisions and actions has a big impact.

Language You can tell a lot by how people talk about their colleagues, leaders and where they work.

Colloquial and familiar references reflect an open and relaxed culture.

Rackspace – Colleagues refer to themselves and others as ‘Rackers’, bosses by their first names and the Head Office as ‘the Castle’.

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Greg Dyke was fed up of people waffling on in never ending meetings (have you seen the W1A parody?). He introduced the yellow ‘cut the crap’ card – empowering any individual using it to get a meeting moving, a decision made and/or a solution defined. The approach was also a powerful way of giving individuals and teams accountability over decisions, rather than have them fudged.

Recognition

Rolls-Royce – The CEO of the Oil & Gas division was a believer in personally thanking individuals who had gone above and beyond the call of duty. On his rounds of the manufacturing and other areas, he would stop and talk with one or two individuals each morning, ask after their family, ask what they were doing and thank them for a particular aspect of their work.

Corporate anthropology

How people react to mistakes being made is a big give-away of a culture and so is how success is celebrated – especially collective, day-to-day successes.

Safety Safety is about more than physical equipment and strict guidelines on operational activities.

A good safety culture is visible in how people think and act – from Head Office to the frontline.

Anglo American – Start every meeting, at every level of the organisation, with a focus on safety, a key personal lesson or insight from one of the team, an idea which can be pursued – in fact, anything which reinforces the fundamental importance of mitigating possible safety incidents or accidents across the business’s mining operations.

Ask yourself: what are our symbols of culture?

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hat does your workplace sound W like? Are there any words or phrases that typify your business? What do they tell you about the culture and how it is lived?

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What does your workplace look like?

Are there any behaviours or actions that distinguish your business from a similar workplace (aside from branding)?

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What does your workplace feel like?

How did it feel when you first walked into the building on your first day?

How did it feel when you walked in today? What does that tell you about your business and the culture?

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Corporate anthropology: Myriam Day myriam.day @karianandbox.com

Notes on Start-up Culture

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ow many times have you heard a business leader talking about recreating an entrepreneurial or start-up culture?

Can large, complex organisations achieve this and what does it mean to go striving for such a culture?

After all, it is now the case that where it once took three or four generations to build a billion-pound business, some start-ups are achieving that in three or four years. Culture, as well as technological innovation and opportunity, is responsible for this.

Start-ups are certainly the epitome of what’s cool and trendy in the corporate world today, but many of their ideas do hold weight. They aren’t merely passing fads for hip Silicon Valley – or Silicon Roundabout – entrepreneurs.

We have been closely observing start-up culture, and we’ve noted its key attributes with suggestions about how you can apply them in practical and creative ways in your business.

Google

Smart thinking

Rituals Creative freedom oogle is often nominated as the poster child of start-up culture. It famously used the 80/20 rule, which gave all Google employees 20% free time to spend on projects of their choosing. However, it has recently been reported that they have axed this rule – a step away from giving their employees as much creative freedom as they have had in the past.

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But there are undeniable benefits to giving employees the time and space to generate new ideas and work without being micro-managed. Think about a handy item of stationery that is used worldwide. More than 50 billion are sold each year. They’re in stationery cupboards everywhere. And yet they are the result of a failed invention – a scientist at 3M invented a glue that wouldn’t stick, and it resulted in the Post-It note.

So how can you, as a business leader, create a conducive environment in which creative free thinkers can thrive?

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he habits and customs that form rituals are integral to the nature of start-up culture, boosting morale and making employees feel part of a committed team.

Putting the kettle on and making the all-important cup of tea or coffee goes hand in hand with the work day. And many startups take this one step further by offering their employees food.

It doesn’t have to be anything fancy. It could be as simple as a fruit box in the corner of the office or a Friday morning bacon sandwich ritual.

We attach symbolism to eating because it is linked so closely with sharing and collective social occasions. In a start-up, breaking bread together is a perfect opportunity for team bonding and making connections.

What are your office rituals? They don’t have to be expensive or elaborate. One start-up has a custom of ringing a bell each time the team reaches a milestone, similar to the Karian and Box tradition of setting off a party popper each time we complete a project. It has to be something meaningful and unique – introducing token gestures to make your culture more like the quirky, fun cultures portrayed in the media isn’t going to change your company culture overnight.

Long hours tart-ups, as the term describes, sprout from the ground upwards. It takes patience, perseverance and hours of effort to get those wheels turning and build a successful business.

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However, while a culture of long hours may initially be necessary to help a fledgling start-up lift off from the runway, this becomes detrimental in a larger business. When the media furore about Amazon’s work culture exploded in the headlines in 2015, it was no surprise to hear that many of the Amazonian ‘athletes’ are experiencing burnout.

“Start-ups are a marathon, not a sprint” has become a cliché, but it holds weight in the case of Amazon. Long hours is one aspect of start-up culture that we wouldn’t recommend trying to implement if you’re aiming to improve the ethos of your business. If you do have to work long hours at times, consider what could be done to help offset this.

Values ne thing that stands out about start-up culture is the strong identity that pervades each business. Start-ups have deeply embedded values, influenced by their founders who had an opportunity to instil their personalities and cultural values from the beginning.

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The perks that the media enthuses about, such as free food and meditation classes, are merely the trimmings. They’re added extras which definitely make a difference during the work day, but the values of start-up culture are most important.

or many start-ups, ‘doing more with less’ is the name of the game. Creative ideas don’t always need stacks of money as a launch pad – introducing a spirit of frugality encourages people to think outside the box and generate innovative solutions.

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Frugality has strong benefits regardless of whether your business is a small start-up or a large multinational. It’s easy to be frugal when you’re running a budding business with tightened purse strings, but when your business expands and you have the means to spend, frugality becomes an important mind-set to guide your business culture.

A more attractive brand and strong employee buy-in – what’s not to like?

The most valuable things for a start-up – or, indeed, any business – are people and product. While frugality is invaluable, don’t scrimp on what matters. thinkBites thinkBites

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Smart thinking

Frugality

Clear value systems benefit the business on more than one level.

When businesses are recruiting, their identity attracts people who share their values and this builds a strong foundation. For current employees, collective values encourage engagement with the business through a sense of a shared purpose. And for consumers, this identity shines through in the creative expression of start-up branding, making the products more attractive to buyers.

Read all about it…

A different take on organisational culture

The (Honest) Truth About Dishonesty: How We Lie to Everyone – Especially Ourselves by Dan Ariely

Ghassan Karian ghassan.karian @karianandbox.com

Almost everyone agrees dishonesty is wrong. From the bedroom to the boardroom, partners in life and in business effusively assure each other that they will always be faithful. But if dishonesty is universally recognised as sinful, how come so many of us lie about our age, cheat at poker or steal office supplies?

In this book, Ariely deploys a series of experiments reinforced by personal anecdotes to explain why dishonesty pervades our lives. His insights about the causes of ubiquitous dishonesty can be summed up in two familiar idioms: Cheating is a slippery slope.

When we’ve committed a wilful act of dishonesty, we’re really good at retrospectively convincing ourselves that it wasn’t really wrong to begin with. Meaning that if you’ve pilfered a pen from the supply cupboard once, your’re very likely to do it again, and perhaps upgrade to a notepad next time. But this doesn’t mean that pen thieves are destined to become bank robbers. Dishonesty in one area of life doesn’t necessarily mean that you’re dishonest in another, leading us to Ariely’s second pearl of wisdom.

There are several ways to address dishonesty. However, codes of conduct, ethics courses and disclosure policies are not among them, according to Ariely. Instead, he highlights the effectiveness of what he calls “resetting rituals”. Such practices are common within religions. All of these practices remind us of our moral standards, provide an opportunity to symbolically break the chain of dishonest behaviour and – in some cases – the means to make amends.

The business equivalents of such rituals include culture and values workshops – forums in which employees can openly discuss dishonest practices within their company. We’ve seen examples of this first-hand in our work with organisations after the financial crisis. When employees contextualise business practices within a larger framework of values, they often realise that what they understand as business as usual they would reject as immoral in a different context.

While Ariely tells us little we didn’t already know, this is a timely reminder of how cultures of dishonesty are easily formed – and the difficult action necessary to keep yourself, and your colleagues, honest.

Reviews

You’re only as good as the company you keep.

Ariely’s findings suggest that cheating is contagious within groups. That is, when your colleagues realise that you’ve illicitly filched that pen, they are more likely to do so as well, which in turn reinforces your conclusion that it wasn’t wrong to begin with through the establishment of a social norm. This creates a culture where particular types of dishonesty appear acceptable.

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T hatcher Hullerman Cook and HarperCollins

It Takes More than Casual Fridays and Free Coffee: Building a Business Culture That Works for Everyone by Diane K. Adams Diane K. Adams’s 2015 book talks eloquently about how businesses can develop positive cultures while continuing to grow and prosper. As she shows the reader through the many real-life anecdotes and experiences in the book, a business can be performancefocused and values-based. It doesn’t have to be an either/or scenario.

Adams begins by outlining culture. As a phrase that is bandied around so frequently in business, her book offers a refreshing look at what an effective business culture actually means in practice. It’s common, she says, to equate a positive culture with the kind of attentiongrabbing perks promulgated by the media: quirky workplaces, food trucks or, indeed, “casual Fridays” and “free coffee”.

Palgrave Macmillan

But, in fact, culture needs to go deeper than these attractive sweeteners. They are the sugar in your “free coffee”, but they’re not the main ingredient. A truly positive business culture has a strong foundation which is built on values: “the set of values that drive the thinking and the actions of an organisation and its people day in and day out”. Although key values will vary depending on the nature of your business, Adams goes on to outline the seven essential values found in most highly successful companies. Reassuringly, she also gives concrete examples of how culture translates for the bottom line. For any sceptics out there, who may view business culture talk as unoriginal fluff, Adams is bound to make you think. As this book illustrates, values matter.

Glengarry Glen Ross – Director: James Foley “We’re adding a little something to this month’s sales contest. As you all know, first prize is a Cadillac Eldorado. Second prize is a set of steak knives. Third prize is you’re fired.” desperately with their task. As the deadline closes in, some of the more disaffected employees hatch a plan to steal the red-hot Glengarry sales leads from the filing cabinet of their oleaginous new-breed boss, ‘company man’ Kevin Spacey, and sell them to the business’s main competitor.

The cut-throat world of the play portrays the full gamut of management sin and employee disenchantment. The film is a darkly comic warning against any employer that forgets its basic humanity and motivates its employees through threats and internecine competition.

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New Line Cinema

If you’re bored of laughing at David Brent then you can find a different kind of awful manager in this classic 1992 film adaptation of David Mamet’s Pulitzer Prize-winning play, which dramatises a funny and scary world of sadistic management and disaffected employees.

Featuring a stellar cast, including Jack Lemmon and Al Pacino, the action follows a prickly team of real-estate salesmen who are given a piece of motivational Darwinism by ball-breaking executive Alec Baldwin: finish last and you’re fired. While Pacino’s star performer Ricky Roma is made for this sales contest for survival, the other agents struggle

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The art and science of prediction Our world is fast-paced and constantly changing and it is becoming increasingly difficult to engage employees and elicit genuine commitment.

Knowing what people think and feel today is critical, but it isn’t always enough. Successful businesses need to stay one step ahead by attempting the seemingly impossible – predicting the future.

Catch the next issue of thinkBites, where we’ll be looking at big data and how it’s revolutionising research – from science and medicine to marketing and employee analytics. Sophisticated techniques such as predictive analytics can give us a glimpse into employee behaviour and sentiment in 2017, 2018 and beyond.

But is it all it’s cracked up to be? And where do you start?

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