A Cultural Hypothesis

A Cultural Hypothesis

Dr. Edd Vahid - March 2024

Preface

Chapter 1: A Cultural Hypothesis

1.1. Introduction

1.2. Cultural Hypothesis

1.3. Purpose

1.4. Psychological Safety

1.5. Belonging

1.6. Cultural Leadership

1.7. Summary

Chapter 2: Future Possibilities

2.1. Areas of Future Interest Chapter 3: Recommended Reading & Resources

Preface

This document is intended as a catalyst for conversation. We do not presume to have all the answers. We do not even presume to have all the questions. What we do have is a passion for culture and a deep curiosity to uncover the ‘secrets’ of the topic. We want to understand how leaders and teams can practically influence a positive culture - one that delivers for the organisation, for the people that interact with it, and for wider society.

Since our foundation in the late 1990s we’ve worked to evolve cultures. We haven’t always viewed it through a cultural lens and everything we’ve done can be seen as at least a ‘micro-cultural initiative’ - from coaching to coach skills training and from team development to leadership skills, they have all played a part.

Recently the term culture is more prevalent and our work more holistic. We’re helping clients embed ‘coaching culture’supporting organisations on needs related to diversity, equity and inclusion, and on wholesale cultural transformation. With each piece of culture work our thirst to learn increases. We are incredibly parched! And in Dr Edd Vahid, the author, we have a kindred spirit. Edd is an expert in the field and we’ve collaborated and supported each other for over 12 years. (Find out more about Edd here.)

We first discussed commissioning Edd to research and write a paper in June 2022. We were keen to see where the research would lead us and not to be prescriptive about the end product. Following hundreds of hours of research, of interviews, and of check and challenge against real-life experience, a Cultural Hypothesis emerged.

The Hypothesis offers stories of people and organisations, and we know that no one individual, or entity is perfect.

It deliberately avoids devoting too many words to defining culture. It also avoids lengthy exploration of processes, principles and theories related to facilitating culture.

We want the Hypothesis to be accessible, practical and to hold the attention of all who may benefit from reading it. Fear not though. Anyone interested in exploring these topics can do so in the sister paper “Leading Cultural Change - Insights & Quick Wins” - due to be published in the coming months.

The Cultural Hypothesis highlights four key enablers of healthy, high performing organisations. We trust it’s useful for our clients, and for anyone out there aiming to shape positive cultures that enable people and organisations to flourish.

We hope it does its job as a catalyst for conversation and we welcome you to join us. For anyone interested in events and insights related to the topic please contact us at highperformance@managementfutures.co.uk.

The Cultural Hypothesis is a beginning and we look forward to progressing together.

Shona, John, Tim and the MF Team

Chapter 1: A Cultural Hypothesis

1.1 Introduction

A healthy culture is often promoted as a critical feature of a high performing organisation. As such, it has received significant attention, with organisations understandably seeking to establish its role in creating a competitive advantage.

Indeed, narratives of success (and conversely, failure) are often punctuated with references to the culture that preceded these outputs. Extracts highlighted below emphasise this sentiment:

• From Sport:

Following a ball tampering incident in 2018 that saw three players banned, Cricket Australia (CA) commissioned a review of their organisational culture by The Ethics Centre who, in the introductory paragraphs, acknowledged, ‘the leadership of CA should also accept responsibility for its inadvertent (but foreseeable) failure to create and support a culture in which the will-to-win was balanced by an equal commitment to moral courage and ethical restraint.’

• From Business:

In their Project Earth Report (2022, p.40), retail group Selfridges highlighted how they ‘have committed to reinvent retail and (we) believe that challenging our mindsets and our culture will be the catalyst for that reinvention’. Specifically, they intend on building ‘an inclusive retail culture in which our teams, our communities and our customers put people and planet first in all their decisions by 2030’. The positive intent expressed by Selfridges is matched by the importance placed upon their continued cultural evolution.

What

What

Given its potential complexity, the organisational culture framework created by Edgar Schein (please see Figure 1 below) provides a useful introduction to culture. The framework helpfully acknowledges that the behaviours ‘we see’ (e.g., systems, processes, and policies) are often underpinned by ‘what we say’ (e.g. ideals, goals, values, and aspirations) and ‘what we believe’ (i.e. underlying assumptions). This has led to many describing culture as what you ‘see, hear and feel’. Importantly, an alignment between these elements is essential, with organisations often criticised for a disparity between what is said (e.g. company values) and subsequently done. Indeed, UK Sport previously acknowledged that ‘one of the biggest risks facing organisations in terms of culture is a lack of alignment between the culture that is formally articulated by its leaders and the culture that is experienced in reality.’

Figure 1. Organisational Cultural Framework (Edgar Schein)

Angus Gardiner, General Manager at the successful New Zealand Rugby Union team Crusaders highlighted how ‘good teams and bad teams have the same values written on the wall.’ This quote further emphasises a common discrepancy, which ultimately undermines an organisation’s performance aspiration. The term ‘shadow values’ has been deployed to acknowledge the values that genuinely drive an organisation’s behaviour, with employees acutely aware of what is rewarded or encouraged in everyday activities. Supporting this notion, John Amaechi once stated that ‘your culture is defined by the worst behaviour you tolerate.’

A compelling body of evidence would support the notion that a ‘good’ culture is a critical feature of sustainable high performance. The term sustainable is noteworthy and reflects the reality that short-term success can be achieved in a more transactional manner. Indeed, some scenarios might demand an approach that compromises the features that appear to be present when sustainable success is evident (see cultural hypothesis that follows). However, even in these scenarios it is important to note that the reputational component of culture extends beyond the confines of an organisation. David Martin (Head of Trends & Insights, TrendWatching) commented that ‘there’s really no such thing as internal culture anymore. Your culture is always public, and it’s your most powerful, public-facing asset or liability.’ In this way, an organisation’s (internally and externally) perceived culture represents an important recruitment, and vitally, retention tool. Reinforcing this sentiment, James Timpson (CEO, Timpson)

highlighted how ‘there’s something about our culture that makes them (colleagues) want to come to work and perform’. Following a survey of 5,000 adults in 2019, Glassdoor shared that 77% of respondents would consider a company culture before applying and many prioritised culture over pay (54%) when making career decisions.

Daniel Coyle (author of the Culture Code) suggested that ‘one of the best measures of any group’s culture is its learning velocity; how quickly it improves performance’. Given the evident performance value of culture, the paragraphs to follow are designed to blend several case studies through a cultural lens. The selected case studies largely promote organisations who have been celebrated for their cultural achievements. Given the dynamic nature of culture, there is a recognition on our part, and often an admission by the identified organisations, that their cultures have not always maintained their cultural ideal.

A cultural hypothesis is presented. Supported by evidence and selected case studies, this represents an intent to highlight the features that commonly characterise cultures that sustain success. The term hypothesis is deliberately used to invite challenge, provoke debate, and openly test its validity in a range of domains. It also reflects a desire to constantly evolve understanding and practice in this area. The hypothesis is designed to complement the extensive work that has highlighted types and styles of culture and celebrate the features that seemingly represent non-negotiables for success.

‘One of the best measures of any group’s culture is its learning velocity; how quickly it improves performance.’

1.2 Cultural Hypothesis

Every culture is unique. Given culture is a product of the dynamic that exists between individuals this is understandable. Whilst acknowledging that each culture is nuanced (and should be celebrated) several features appear to consistently emerge in those that have sustained success. These could be considered enablers.

These enablers form the basis of the stated hypothesis, are interdependent and include:

1. Purpose

2. Psychological Safety

3. Belonging

4. Cultural Leadership

The visual below depicts cultural leadership as a central feature of the hypothesis. It is postulated that cultural leadership exists as a super enabler and is critical to the emergence of psychological safety and belonging. The paragraphs that follow expand on this proposition. In turn, we will explore these elements and reference their significance in cultures that are characterised by their health, success, and sustainability.

1.3 Purpose

Following extensive research into organisations who have enjoyed sustained success, Professor Alex Hill highlighted several distinct features. In broad terms, these organisations (including the All Blacks, NASA, and the Royal Shakespeare Company), demonstrate a stable core and a disruptive edge.

The stable core represents a safeguard of the traditional features of an organisation, including purpose, stewardship, and openness. The disruptive edge provides the necessary disturbance for a system to evolve, and included the headline features of disruptive experts, disruptive nervousness, and disruptive accidents.

Significantly, these organisations’ stated purpose generally expressed a desire to impact on a wider societal level.

Clifford Geertz, an American Anthropologist, once described culture as ‘the stories we tell ourselves (and others) about ourselves’. A story that has been told countless times in the decades that followed the visit of a US president to NASA in 1961 has served an important role in preserving the cultural narrative. John F. Kennedy famously visited NASA headquarters and, in an exchange with a cleaner, learnt that their role was to ‘help put a man on the moon’. An inspiring thought that extended beyond the likely mundane tasks that may have consumed this individual’s time. Importantly, this narrative demonstrates the parallel benefits of an inspiring purpose. Firstly, it operates at an organisational level and sets a direction for the future. Significantly, the purpose also transcends to an individual level.

Included below are examples of the stated purpose of several organisations. Naturally, some are more well known that others. However, they are each aligned in creating an inspiring purpose that provides the framework for decision making and guides employee behaviour:

Southwest Airlines: ‘Connect People to what’s important in their lives through friendly, reliable, low-cost air travel’

St Joseph’s School: Pupils are encouraged to ‘get out there and change the world for the better ’ with staff challenged to ‘unlock belief in all ’.

Patagonia: ‘We’re in business to save our home planet ’

Unilever: ‘Make sustainable living commonplace’

Yvon Chouinard, founder of clothing company Patagonia, has built a brand driven by purpose. From the outset Chouinard committed to ‘using our company to change the

way business was done’. To ensure purpose is the genuine driver of decisions, the Patagonia Purpose Trust owns the voting stock of the company. This essentially means all key decisions are made in line with their stated purpose. The Trust acts as a guardian and helps reconcile the challenge of growing a business in a competitive industry without compromising on purpose.

St Joseph’s Catholic High School is based in one of the UK’s most deprived areas in Slough. Despite this potential disadvantage, guided by the leadership of Headteacher Ciran Stapleton, the school aspires to be an ambitious and inspirational haven for its pupils. Underpinning a purpose to help children positively impact the world is a belief that you can unlock potential in all. This ethos is evident in interactions, with pupils consistently encouraged to set high standards and strive for personal excellence.

Alan Jope, former CEO of Unilever, passionately stated that ‘we are unequivocally convinced that brands that stand for something bigger than shinier hair, softer skin, or whiter clothes… brands that go beyond that will grow faster ’. Whilst recognising that ‘you cannot fake purpose’, Jope presents a compelling argument for the competitive advantage that a strong purpose provides. Additionally, he acknowledges the value of an individual purpose that broadly aligns with the company ethos. Indeed, Unilever have engaged in research that has identified where individual and organisational alignment on purpose is evident, employees are four times more engaged with the company, report five times better wellbeing scores, report high resilience and typically outperform their peers.

A HBR article in 2019, written by Anthony, Trotter, and Schwartz, further supports this sentiment. The authors summarised a study by Innosight, which had reviewed the most transformative businesses in the preceding decade. Transformation was determined by new growth, a repositioning of core business and strong financial returns. Significantly, whilst contemplating the success of these organisations the authors reflected a belief that ‘the decision to infuse a higher purpose into the culture, one that guides strategic decisions and gives clarity to everyday tasks, [that] has propelled these companies to success.’

1.4 Psychological Safety

Realising an ambitious purpose or objective requires an infrastructure that maximises potential. A key component is psychological safety. Amy Edmondson, author of The Fearless Organisation and the preeminent academic in this area, emphasised how ‘making the environment safe for open communication about challenges, concerns and opportunities is one of the most important leadership responsibilities in the twentyfirst century.’

Indeed, a recent HBR article (Gube and Hennelly, 2022) described the importance of making psychological safety a strategic priority. Supporting the interdependent nature of the elements compromising the current hypothesis, the authors acknowledged how ‘the fear of retaliation for speaking up compromises integrity, curbing creative ideation leads to stagnation, and disrespectful interactions have a disproportionately toxic impact on engagement and belonging.’

Google initiated Project Aristotle with the aim of understanding what characterises their most effective teams. Following a review of 180 globally distributed teams, they concluded that ‘how’ rather than ‘who’ represented the key determinant of success. Specifically, how a team worked together was more important than who was on the team. In order of importance, Google highlighted psychological safety, dependability, structure, clarity, meaning and impact as the key features of their most effective teams. Psychological safety was defined as ‘an individual’s perception of the consequences of taking an interpersonal risk’ and represents an area that has received significant attention in recent years. Whilst this section is primarily focused on how psychological safety is manifested in the highest performing and most sustainable cultures, it is worth noting that ‘meaning’ was considered an important contributor to success. Reinforcing the sentiments discussed in the previous section, meaning detailed the value of having a sense of purpose.

Interestingly, a key feature of Netflix success has been a ‘talent density’ strategy. Whilst this initially might appear in contradiction to Google (i.e. ‘how’ over ‘who’), their philosophy to lead with ‘context not control’ perhaps emphasises the value of ‘how’ plus ‘who’. Recruiting the best talent and creating conditions that allow them to thrive represents a formidable combination. The importance of talent is revisited in our sister paper ‘Leading Cultural Change – Insights and Quick Wins’.

Netflix has enjoyed strong success in recent years by consistently delivering in alignment with a set of fundamental beliefs. Several practical and philosophical insights from Netflix offer evidence of an intent to cultivate a psychologically safe environment. For example, they aspire to increase candour with feedback seen as an integral feature of the organisation’s success. This has involved introducing feedback mechanisms and actively promoting an ethos that guides individuals to ‘only say about someone that you will say to their face’. Managers and their direct reports are encouraged to discuss the ‘keepers test’. This involves Managers pondering ‘if a person on your team were to quit tomorrow, would you try to change their mind?’ and employees being given ‘permission’ to ask ‘if I were thinking of leaving, how hard would you work to change my mind?’ These questions are designed to help maintain a healthy and regular dialogue between personnel.

Netflix has actively reduced controls to overtly engender trust in their staff. For example, their expenses policy requires employees to ‘act in Netflix’s best interests’. Additionally, Netflix emphasises the value of localised and context-led decision making. They consider themselves to be a ‘highly aligned and loosely coupled’ organisation. This system permits localised and cascaded decision making and is somewhat reminiscent of the intent-based leadership that David Marquet described in Turn the Ship Around! Francesca Gino, author of Rebel Talent, celebrated the work of Southwest airlines in providing autonomy for their employees. Gino highlights how employees are actively encouraged to behave in an authentic fashion, with this philosophy supporting the achievement of ‘high passenger volume, profitability, and customer satisfaction. Southwest has a low turnover and a near-perfect safety record’.

Christian Horner (Team Principal of the Red Bull Formula One team) described his experience of inheriting an underperforming and dysfunctional team at Red Bull. Specifically, Horner highlighted a chronic blame culture: ‘the drawing office blamed Aero. Aero blamed the wind tunnel. R&D blamed production. The race team blamed everybody! There was just this blame culture, where there was no accountability

or collective responsibility.’ The culture described is clearly not conducive to sustained success and would be debilitating for those involved. Conversely, staff and players at Saracens RFC have described how a former CEO operated with a default answer of ‘yes’. This mindset was based on the belief that any requests would be in the best interests of the organisation and their people. James Timpson described how his leadership style, and the ‘culture of trust ’ developed at Timpson, evolved out of his experience working on the shop floor. In this capacity, Timpson (the current CEO) consistently doubled the turnover by essentially breaking rules - an approach he felt comfortable deploying due to his status as the boss’s son. The psychological safety this afforded permitted a localised approach to decision making reminiscent of the ethos evident at Netflix and Southwest Airlines.

In Black Box Thinking, Matthew Syed described the difference between the aviation industry and healthcare in their approach and response to mistakes. Specifically, Syed espoused the virtues of the aviation industry and an environment that encouraged learning. An expectation to engage in honest and constructive reviews, seemingly contributing to an industry that can report a strong safety record.

1.5

The concept of belonging represents a helpful extension of psychological safety. Indeed, Amy Edmondson stated that ‘a workplace that is truly characterised by inclusion and belonging is a psychologically safe workplace.’

Furthermore, Timothy Clark believed psychological safety is a condition fully experienced when individuals feel included, safe to learn, safe to contribute, and safe to challenge. These elements comprise the four stages of his psychological safety model. Clark encourages people to use the model as a framework to diagnose their experience of psychological safety, recognising differing levels exist. With relevance to this section (on belonging), inclusion safety ‘is created and sustained through renewed admittance to the group and repeated indications of acceptance’ and, according to Clark, should be

considered a ‘moral imperative’. Significantly, inclusion safety represents a precursor to learner safety, contributor safety, and challenger safety.

In the case studies that follow it is evident that within organisations where belonging represents a core feature of their success (defined in terms of retention and performance), diversity, equity, and inclusion are fundamental priorities. The Belonging Graph included below provides a helpful representation of the interplay between these elements.

Owen Eastwood (author of the book, Belonging) highlighted how ‘our senses are primed to constantly seek information about belonging from our environment. We are hardwired to quickly and intuitively understand whether or not we are in a safe place with people we can trust.’ Notably, Eastwood and Clark both infer that our experience or feeling of belonging is temporal - a view shared by Daniel Coyle who stated that ‘belonging needs to be continually refreshed and reinforced.’ Coyle highlighted the value of belonging cues in creating connection. According to Coyle, a belonging cue might include ‘proximity, eye contact, energy, mimicry, turn taking, attention, body language, vocal pitch, consistency of emphasis, and whether everyone talks to everyone else in the group’. Like psychological safety, an experience of belonging is deeply personal. Maya Angelou, the late poet and civil rights activist, was famously quoted as saying ‘people will forget what you said, people will forget what you did, but people will never forget how you made them feel.’ Whilst a feeling of belonging potentially fluctuates, it leaves an indelible trace. Whilst subtle, the consistent presence and refinement of the cues highlighted by Daniel Coyle represent a vital feature of the most sustainable and high performing cultures. Combined with carefully considered, deliberate and overt initiatives that prioritise belonging, it can be transformational.

Following a detailed review of literature, Groysberg and colleagues (2018) highlighted four attributes that were commonly used to define culture. Specifically, their synthesis indicated that culture is shared, pervasive, enduring and implicit. The long term impact of culture influenced the inclusion of ‘enduring’ as one of the four attributes, with the selfreinforcing nature of culture making it increasingly resistant to change. This could have direct implications for an individual or

group’s experience of belonging. Indeed, Eastwood highlighted how, ‘a colonisation of belonging by an established few who may enjoy status and power is common across groups and teams. Often, those pockets of power come from a dominant clique (status, class, gender, race, religion, education, schooling) and their view of the world become the default setting for the group.’ ‘Culture fit’ is often referenced in the recruitment process of new staff as a critical, if not tangible, criteria when determining the suitability of a prospective employee. Whilst seemingly unintentional, such an outlook might compromise an aspiration to both recruit and ensure a diverse workforce can thrive.

Owen Eastwood highlighted the cultural journey of the New Zealand rugby team, the All Blacks, and their important evolution in embracing an increasingly diverse group of players. Cultural awareness, belonging cues and rituals, and player voice sessions appeared fundamental to the All Blacks belonging journey. Cultural awareness was enhanced with sessions facilitated for each ethnic group to share their core beliefs. Senior players recognised their role as cultural leaders and proactively welcomed new players. Evan Carr and colleagues (2019) referenced the role of an Ally in supporting an individual’s experience of belonging. The senior players seemingly recognise the vital role they play in this respect. Additionally, it is evident that the All Blacks put an emphasis on a comprehensive induction that connected (and reconnected) players with the identity story of the team. Owen Eastwood uses the Māori term whakapapa to express the importance of a connection with the past, and the role current players have ‘not to preserve the status quo but to strengthen it. Hence the team’s ethos – leave the shirt in a better place’. Players are expected to ‘add to’ not ‘fit’ the culture.

The retail group, Selfridges aim to ‘change the way we shop’ is underpinned by a desire to ‘understand similarities and celebrate differences’. An initiative seen as instrumental to this vision, which also features in the ‘cultural leadership’ section of this paper, is the Diversity Board. Formed in 2020 the Board benefited from a company-wide cultural assessment, which helped identify ‘culturally stressed communities’ and establish perceived ‘in vs. out groups’. As featured in their Project Earth Report (2022), the Diversity Board is built on three pillars: Everyone Is Welcome, The Yellow Curriculum, and Broadening Our Buy. Manifesting an intent to ‘reinvent retail with a diverse and accessible view, ensuring a truly inclusive team member and customer experience’, Everyone Is Welcome has already contributed to initiatives such as ‘chat for change’ (an online Teams call for colleagues to explore various topics), and a ‘quiet hour’ in store was introduced in March 2022. As part of the Neurodiversity Celebration week, ‘quiet hour’ is designed ‘to support customers with autism spectrum conditions, sensory sensitivities and mental health conditions such as anxiety’. The Yellow Curriculum represents the importance of education and is a commitment from Selfridges to ensure team members have access to content and experiences in subjects related to diversity and inclusion. Finally, Broadening Our Buy is a commitment to ‘purpose-led partnerships and collaboration to build a network of brands and supplies that are diverse in their thinking, their approach and their teams’. Selfridges hold a dual aspiration, which involves creating a sense of belonging for both employees and customers and have clearly been proactive and attentive in pursuing these ambitions.

Another organisation with an identity story characterised by belonging is the John Lewis partnership. Employees have been considered partners since John Spedan Lewis first published their constitution in 1928. In the foreword to the November 2022 constitution, Partner and Chairman Sharon White, commented how ‘when you work in the Partnership, you’re more than an employee, you’re a Partner. And in becoming a Partner, you become a custodian of our experiment in industrial democracy. Each generation caring for and nourishing our democracy and distinctive character for future generations to come.’ Whilst the organisation has naturally evolved, at the heart of the business are a series of principles, which promote happier people (Partners), contributing to a happier business that ultimately impacts a happier world. These principles are underpinned with an intent to create an inclusive and supportive environment, where Partner opinion is actively sought. A Partnership Council exists as the representative voice of the Partners, and in their 2020-21 Inclusion Report the organisation stated its aim to become the UK’s most inclusive business. The stated aim was supplemented by an awareness that the organisation would need to ‘improve the cultural knowledge and capability of our leaders and Partners, make sure our policies and practises are fair, and create an environment where we all feel safe, understood, and respected’. Development programmes for under-represented groups, partnership networks, opportunities to share Partner stories, an equal parenthood policy, and an Inclusion Committee represent progress and a connection to the ethos of belonging that the company was founded upon.

Andoni Bombin (Former Head of Methodology at Athletic Bilbao) described ‘belonging’ as the feature that distinguished Athletic Bilbao from other football clubs and has been integral to their sustained success. Possibly more exclusive than inclusive, Athletic Bilbao are a unique football club operating under self-imposed constraints that prioritise their traditions and fundamental beliefs. Specifically, Bilbao restrict their talent pool to players (or their parents) born in the Basque country, a population reflective, in size, of the metropolitan area of Manchester. In many ways they have created an exclusive environment. Given the global interest, significant investment, and international movement of talented players, operating under such constraints would appear counter-productive and pass an advantage to opponents in an incredibly competitive industry. Contrastingly, this approach has seen them consistently achieve success. In addition to multiple trophies, Spanish giants Real Madrid and Barcelona, join Athletic Club de Bilbao as the only teams never to be relegated from the Spanish top tier. Andoni explained how the approach encourages them to ‘believe in their people’. Echoing these comments, former player, and sporting director Jose Maria Amorrortu explained in Ben Lyttleton’s book Edge, ‘we have a 100-year-old culture, and that tradition is always to count on kids from our region. This has hardened into our identity…the values we have are fundamental and they form a culture which is the expression of a way of being’. The sense of belonging generated by the club philosophy is a competitive advantage and is the envy of many clubs.

The organisations highlighted in this section, like those featured throughout the paper, do not profess to have completed culture. Indeed, it will never be complete. However, it is evident these organisations recognise the value of belonging and have actively committed to understanding and caring for their (past, present, and future) individuals. The key features include celebrating and promoting a connection with history, facilitating opportunities to understand (e.g. diversity board and player voice sessions) and a recognition that the personal feeling of belonging is dynamic and therefore requires regular attention. Importantly, these features are reflective of both overt and deliberate initiatives, and the more subtle, yet equally significant, belonging cues that require consistent deployment. Significantly, whilst these organisations have clearly articulated aspirations for belonging, an outlook that prioritises actions over words is a defining feature of the most transformational and sustainable cultures.

Bourke and Titus (2020) reported that leaders can make up to a 70% difference in an individual’s experience of inclusion. The authors research highlighted a series of traits that define those leaders having a positive impact. Specifically, such leaders demonstrated a visible commitment to diversity and were comfortable and confident in challenging the status quo. This was underpinned by a humility, curiosity to learn about others, and an awareness of personal biases, which enhanced their cultural intelligence. Finally, such individuals actively facilitated opportunities for collaboration amongst diverse groups of individuals. The role of leaders has featured, both explicitly and implicitly, throughout the preceding pages of this paper. The concept of cultural leadership now becomes the focus in the final section of the hypothesis.

1.6 Cultural Leadership

An inspiring purpose is essential, a psychologically safe environment is critical, and a sense of belonging exists as a fundamental human need. Coupled with exceptional leadership, these elements distinguish cultures that thrive.

The broad term cultural leadership is adopted to acknowledge that leadership exists on multiple levels within an organisation. Terms such as ‘change agents’, ‘values ambassadors’, and ‘culture champions’ have been used interchangeably to celebrate the critical role of cultural leaders. Based on the insights secured, it is proposed that cultural leadership is comprised of three distinct and critical elements. Specifically, insights from several of the most sustainable and transformational high performing cultures indicate the optimal co-existence of sponsors, architects, and guardians. Several positively-oriented case studies provide real life insight into the necessity for the existence and alignment between these elements. Conversely, it is suggested that the absence or misalignment of these components of cultural leadership undermine progression.

As mentioned, Selfridges promote an ambitious vision to ‘reinvent retail’ and ‘change the way we shop’. One strategy actively contributing to this ambition is a Diversity Board, which was introduced in 2020 and includes 12 board members representing different parts of the organisation. Whilst the board remains in its relative infancy, it can point to positive change in an approach to annual reviews, multiple products, the introduction of gender-neutral toilets, and several personnel promoted to and occupying senior roles as significant success stories. In seeking to dissect the success of this cultural change initiative with two founding members, Julia Reardon and Melisa Clottey, the essential role of sponsors, and deliberate investment in architects and guardians is clear. From the outset, the Ownership

and Managing Director expressed their commitment and sponsorship of the initiative. The sponsorship role subsequently extended to members of the executive board who had direct involvement with each meeting. As Julia and Melisa highlighted, this ensured the initiative was considered a ‘credible proposition’ by the broader organisation. The sponsor generally occupies a position of seniority or authority. Katie Lloyd, formerly a BBC executive and Global Head of Culture at LEGO group, expressed a similar view when suggesting culture is ‘led from the bottom, sponsored by the top’ and that effective cultural change should be modelled on a ‘top down and grassroots movement ’. Whilst one or multiple people could occupy both the sponsor and architect role, they are distinct positions that contribute differently to the cultural leadership of an organisation.

Significantly, the beliefs and behaviour of senior leaders sets the tone and expectations. The insights that have formed this paper, recognise a top-down approach to culture development. The values resplendent on the walls of offices and training grounds are offered meaning and establish importance based on the behaviour of senior leadership. A lack of congruence between words and actions helps shine a light on the ‘shadow values’ that ultimately determine the direction of an organisation. As Alder (2018) stated, ‘If cultural meaning is communicated consistently, the same understanding from the same experience becomes patterned, leading to a shared belief system, or team culture.’ Inconsistencies lead to chaos! The Architect(s) is responsible for designing and modelling the behaviour expected.

Sponsors Architects Guardians

Toto Wolff could be considered an architect. The team principal of the Mercedes F1 team, Wolff oversaw a period of unprecedented success, which included 8 consecutive Constructors’ Championship titles. A case study by Anita Elberse (2022) provided an insight into how Wolff deliberately and painstakingly designed the culture that subsequently manifested. Indeed, Elberse noted how ‘during my research I also came to understand how Wolff, with his mindset, values, and actions, shapes the culture at Mercedes.’ Elberse highlighted six lessons that were evident in Wolff’s leadership approach:

1. Set the highest standards – for everyone

Elberse noted the obsessive attention to detail that Wolff applies to his work and the standards he expects of his team. The case study references Wolff’s disappointing first impressions of the team HQ and event hospitality areas. These examples provide an insight into the architecture and expectations that Wolff established for the team. Given the scale of an F1 team (Mercedes is reported to have 1800 staff), Wolff presumably accepts that accessing the granular detail of each scenario is unrealistic. However, it appears evident that he is deliberate in his intent to design and cultivate excellence.

2. Put people front and centre Elberse references the importance that Wolff places on investing in people. There is an acknowledgment that an expertise in all aspects of the business is challenging and therefore demonstrating trust in others is essential. Regular engagement with team leaders, who potentially occupy the role of cultural guardians, represent a critical part of Wolff’s strategy. These interactions present an opportunity to further reinforce intent and standards.

3. Analyse mistakes even when winning

This lesson is reflective of Wolff’s desire to improve and offers a further example of the expectations he places on the team. Elberse enthusiastically promotes a narrative of learning and high standards, with the chief architect considered to be Wolff.

4. Foster an open, no blame culture

The value placed on conducting a detailed post-event analysis (see point 3) potentially helps mitigate any desire to attribute blame. The process, seemingly facilitated by Wolff, ensures collective responsibility is sought.

5. Trust superstars but maintain authority

Describing his relationship with Lewis Hamilton, Wolff helpfully depicts the role of an architect. “We have a pact. The idea is, ‘You perform, and I create a framework for you that allows you to perform.’ He knows what is good for him—I trust him on that.” Two words carry significance in this sentence and represent recurring themes in the case study that Elberse presented: namely framework and trust. The framework provides the structure and freedom for individual autonomy, which is critically underpinned by trust.

6. Relentlessly battle complacency

As expected, the attention to key cultural elements is designed to avoid complacency and maintain the competitive advantage that Mercedes have often enjoyed under the reign of Toto Wolff.

Whilst senior leaders, such as Toto Wolff, set the tone and their every word and action (consciously or subconsciously) is scrutinised, cultural guardians occupy an integral role in ensuring broad alignment within the various sub-cultures that naturally develop. Given the global nature and scale of some organisations, these individuals play a fundamental role in guiding the desired culture. David Jones from Saracens RFC, spoke about the importance of creating ‘bandwidth’ for senior leaders and cultural guardians. This ‘bandwidth’, if interpreted correctly, is designed to provide guardians with the capacity to pay attention to the culture, maintain the culture or instigate change. The role of cultural guardians is perhaps most pronounced in change, and this forms the focus of our next paper (Leading Cultural Change - Insights & Quick Wins).

Loren Shuster, Chief People Officer, and Head of Corporate Affairs for the LEGO Group during an interview with McKinsey (2023) shared the belief that ‘to continuously thrive in the constantly changing world, everyone in an organisation needs to act as a leader, not the executive leadership team alone.’ This belief almost certainly contributed to the introduction of the ‘Leadership Playground’ in 2019. The ‘Leadership Playground’ is an initiative that protects investment in the cultural guardians operating across the various functions of the organisation. The LEGO Group described the ‘Leadership Playground’ as ‘an inclusive model and working philosophy which makes sure that you’re heard, valued, respected, and able to make a bigger contribution to your team. It’s a place where you can create safe, inspiring, and innovative spaces for

everybody. Most importantly, it’s a space for you to be brave, curious and be focused, the three behaviours that underpin everything that the Leadership Playground is all about’. The LEGO Group actively invite people to occupy the role of a ‘Leadership Playground Builder’ with the expectation that such individuals develop the requisite skills required to curate safe and inclusive ‘campfire discussions’. The ‘Leadership Playground’ represents an initiative reflective of the LEGO Group’s clear desire to invest in their culture and underlies the critical role cultural leadership plays in facilitating the other enablers featured in the hypothesis (i.e. purpose, belonging, and psychological safety). In this regard, cultural leadership can be considered a super enabler.

The LEGO group have skilfully introduced a range of initiatives that align with their brand expectations, and importantly (as presented below) feature language that is synonymous with LEGO. Their former Global Head of Culture, Katie Lloyd previously emphasised the importance of deploying ‘language that is repeatable’ and given the diversity of a global organisation this approach cannot be underestimated. This sentiment was supported by Headteacher Ciran Stapleton, who emphasised the ‘power of language’ in instigating cultural change in a school environment. Ciran quoted the Greek Philosopher, Pericles, who has been attributed with saying that ‘what you say becomes woven into the fabric of other people.’ The consistent rhetoric of a leader (supported by action) is a fundamental feature of organisations who curate a sustained high performing culture.

The LEGO® Brand Framework

1.7 Summary

The preceding paragraphs have presented a cultural hypothesis. Using a series of case studies, the hypothesis proposes the existence of four key enablers in the most sustainable and transformational cultures. Namely, purpose, psychological safety, belonging and cultural leadership.

The enablers are considered interdependent, with cultural leadership enjoying elevated status as a ‘super enabler’. The paper presents a compelling argument for organisations to operate with a purpose that extends beyond their primary business focus. An eclectic group of organisations, from an airline to a school, were used to emphasise this point. Specifically, organisations that attend to the individual purposes of their staff and explore alignment with the company-wide purpose expectedly enjoy positive returns.

Google, via Project Aristotle, previously bestowed psychological safety as a critical feature of high performing teams. It is evident that the healthiest and most high performing cultures recognise the value of psychological safety and prioritise understanding everyone’s experience. Notably, Timothy Clark’s model of psychological safety emphasised inclusion or belonging as a foundation to the most optimal experience of psychological

safety. Presented, using the belonging graph, as a product of diversity, equity, and inclusion, belonging is considered a temporal experience. As such, and like the other enablers, it requires considerable attention and consistency in behaviour. In addition to behaviour, organisations have deployed various initiatives (e.g., Selfridges introduced a Diversity Board), which are underpinned by a genuine care for their people.

Cultural leadership is the final enabler. Given its elevated status, it is understandably reported as having a significant impact on how culture manifests. Comprised of sponsors, architects, and guardians, cultural leadership features prominently in the insights in our next paper: ‘Leading Cultural Change - Insights and Quick Wins.’ The highest performing cultures recognise and proactively invest in their leader’s capacity and capability to nurture the culture often articulated in their aspirations.

Chapter 2: Future Possibilities

2.0 Future Possibilities

The current paper is constructed based on a hypothesis. Such an approach emphasises the open-ended nature of the culture conversation, and the number of variables interacting to constitute an organisation’s culture. A commitment to learning and a cultural curiosity is reflective of the questions detailed below.

2.1 Areas of future interest

a. How do you effectively scale culture?

b. How do you sustain a healthy culture?

c. How can you determine whether an organisation is ready for (cultural) change?

d. How can you effectively triage culture?

e. What represents effective quantitative measures of a culture?

f. How does cohesion and stability impact culture?

g. How can you design the physical space to help manifest the desired culture?

h. How do you manage mergers, when two cultures collide?

i. Do generational differences in cultural expectations exist?

j. How has hybrid working impacted culture?

k. How could sociological insights (e.g. power dynamics) help explain culture?

l. How do you initiate culture (e.g. start-ups)?

m. What does success do to a culture?

n. How does the cultural architect become the cultural architect?

o. How do you start the conversation about culture?

p. Further selected cultural case studies (e.g. IKEA; Burberry; Boston BCG).

Chapter 3: Recommended Reading & Resources

3.0 Recommended Reading & Resources

3.1 Articles

• Anthony, S.D., Trotter, A., and Schwartz, E.I. (2019). The Top 20 Business Transformations of the Last Decade (hbr.org). Harvard Business Review.

• Bourke, J., and Titus, A. (2020). The Key to Inclusive Leadership (hbr.org). Harvard Business Review.

• Carr, W.W., Reece, A., Rosen Kellerman, G., and Robichaux, A. (2019). The Value of Belonging at Work (hbr.org).

Harvard Business Review.

• Elberse, A. (2022). Number One in Formula One (hbr.org). Harvard Business Review.

• Gube, M. and Hennelly, D. S. (2022). Resilient organisations make psychological safety a strategic priority. Harvard Business Review.

• Groysberg, B., Lee, J., Price, J., and Yo-Jud Cheng, J. (2018). The Leader’s Guide to Corporate Culture – how to manage the eight critical elements of organisational life. Harvard Business Review.

• Hill, A., Mellon, L., and Goddard, J. (2018). How winning organisations last 100 years. Harvard Business Review.

• Katzenbach, J.R., Steffen, I., and Kronley, C. (2012). Cultural change that sticks. Harvard Business Review.

• Sull, D., and Sull, C. (2022). How to fix a toxic culture. MIT Sloan Management Review.

• Tabrizi, B. (2023). https://hbr.org/2023/02/how-microsoftbecame-innovative-again. Harvard Business Review.

• Loren I. Shuster: The LEGO Group’s people-first approach | McKinsey.

3.2 Books

• Coyle, D. (2018). The Culture Code: The Culture Code | Unlock The Secrets to the Most Successful Teams (danielcoyle.com)

• Edmondson, A. (2018). The Fearless Organization: The Fearless Organisation

• Hastings, R., and Meyer, E. (2020). No Rules Rules: Netflix and the Culture of Reinvention: No Rules Rules Book

• Marquet, D. (2013). Turn the Ship Around! Turn the Ship Around! Book - David Marquet, Author, Keynote Speaker, Creator of Intent-Based Leadership, Intent-Based Leadership International

• Gino, F. (2018). Rebel Talent – why it pays to break the rules at work and in life: Rebel Talent | Finding Success In Life (rebeltalents.org)

• Syed, M. (2015). Black Box Thinking: Black Box Thinking: The Surprising Truth About Success: Amazon.co.uk: Syed, Matthew, Ltd, Matthew Syed Consulting: 9781473613775: Books

• Eastwood, O. (2021). Belonging – The Ancient Code of Togetherness: Belonging: The Ancient Code of Togetherness: The International No. 1 Bestseller: Amazon. co.uk: Eastwood, Owen: 9781529415063: Books

• Lyttleton, B. (2017). Edge - What Business Can Learn From Football: Edge: What Business Can Learn from Football: Amazon.co.uk: Ben Lyttleton: 9780008225872: Books

• Kotter, J. (2006). Our Iceberg is Melting: Our Iceberg Is Melting - Kotter International Inc (kotterinc.com)

3.3 Podcasts

• Gareth Southgate: GARETH SOUTHGATE — High Performance Podcast (thehighperformancepodcast.com)

• James Timpson: JAMES TIMPSON — High Performance Podcast (thehighperformancepodcast.com)

• Christian Horner: CHRISTIAN HORNER — High Performance Podcast (thehighperformancepodcast.com)

• Alan Jope: Deep Purpose: Unilever CEO Alan Jope Maintains a Long History of Doing Good on Apple Podcasts

• James Watt: The Diary Of A CEO with Steven Bartlett: E157: Brewdog Founder: The Untold Story Of One Britain’s Fastest Growing Companies: James Watt on Apple Podcasts

• Toto Wolf: Toto Wolff — High Performance (thehighperformancepodcast.com)

• Our LEGO® Stories: Leadership for Everyone on Apple Podcasts

3.4 Other

• Amazon: Leadership Principles (amazon.jobs)

• The Ethics Centre (2018). Australian Cricket: A matter of balance. B9F2F708C1A540A08847A4758D02CB99.ashx (cricketaustralia.com.au)

• Whyte, Anne (2022). The Whyte Review: An independent investigation commissioned by Sport England and UK Sport following allegations of mistreatment within the sport of gymnastics. The Whyte Review | UK Sport

• Radically Traditional Website: Create & Sustain High Performance | Radically Traditional

• Patagonia purpose trust: Yvon Chouinard Donates Patagonia to Fight Climate Crisis

• Google – Project Aristotle: re:Work (rework.withgoogle. com)

• Glassdoor: Best Places to Work | Glassdoor

• McKinsey & Company: Establish a performance culture as your “secret sauce” | McKinsey & Company

• Kotter – The 8 steps for leading change: The 8-Step Process for Leading Change | Dr. John Kotter (kotterinc. com)

• Lego Group: UpClose with the LEGO Group | The LEGO Leadership Playground (Be Brave, Be Curious, Be Focused) - YouTube

• Lego Group Brand: The LEGO® Brand - About Us - LEGO. com

• Selfridges – Project Earth Report: NEW_Selfridges_ Project_Earth_Report_2022_FINAL.pdf

• Australia’s High Performance Strategy 2032+ (dmcl.biz)

• John Lewis – Partnership Constitution (November 2022) John Lewis Partnership Constitution

• John Lewis – Inclusion Report (21-21) 21-22-InclusionReport.pdf (johnlewispartnership.co.uk)

Acknowledgements

In creating The Hypothesis, it has been a privilege and an education to spend time with so many exceptional cultural leaders. The generosity they have displayed through their time and wisdom has helped inspire and refine the content presented.

Via a virtual window or sharing their workspace we have been afforded a vivid insight into their cultural reality and aspirations. We would like to specifically acknowledge the contributions from Ciran Stapleton, David Jones, Alex Stacey, Angus Gardiner, Katie Lloyd, Melisa Clottey, Julia Reardon, and Andoni Bombin. More broadly we would like to acknowledge the many commentators listed in the reference section of this paper who have distilled their insights via the various podcasts, articles, resources, and books listed.

Additionally we’d like to acknowledge every one of our clients who we learn with and from. Thank you for trusting us to support you in your ambitions.

And finally to the whole team at MF; thank you for your challenge, dedication and commitment in helping people to flourish. Onwards!