The previous article on ‘People’ sought to drum home among others that High Employee Satisfaction (ESAT) will definitely increase Customer Satisfaction (CSAT) scores; and happy employees don’t just maintain relationships, they build them and eventually create or establish brand loyalty which will help increase a company’s overall Net Promoter Score (NPS) and also lead to value creation for shareholders. What’s good for customers is also good for all other stakeholders.
Great companies therefore ensure that employees have their peace of mind to be able to come to work happy, and of course be recognised as well. By the leave of readers, I am continuing with ‘Organisation’, the third in a series of articles aimed at the Change Process and its Management.
A social change organisation most often seeks to address systemic, root causes of social, political, cultural and economic inequalities in an effort to alleviate not only those inequalities but also the underlying conditions and circumstances that bring them about. In a geopolitical context, Russia’s President Vladimir Putin – speaking at a business forum recently – said among other statements that enormous changes expected in the world will lead to the creation of a new, harmonious, fairer and more community-focused and safe world order which will ensure high growth dynamics in the new epoch. The president added that such will serve as an example for others when it comes to standards and quality of people’s lives, the protection of traditional values and high humanistic ideals. These words from the president ought not to be perceived as utopian from an unhinged leader, but rather be pursued in all spheres of human endeavour.
Organisations can definitely thrive beyond their owners/founders. Having a Business Structure is the foundation for building a legacy business. I am not just talking about having a hierarchical pyramid of the company properly set up devoid of personalities. My emphasis is on policies, operational systems and scope of work, culture and processes. With the Structure properly done, any business can function effectively and profitably in perpetuity.
It was Lee Kuan Yew’s leadership that transformed Singapore from a third-world country into a thriving one. He was so passionate and jealously guarded such a phenomenal achievement. “I have spent a lifetime building this (referring to the city of Singapore), and as long as I am in charge, no one is going to knock it down,” he said. Leaders with this sort of mindset can only witness meteoric successes in their endeavours. Singapore’s success story under Lee is undeniable.
Obviously, he knew he couldn’t be in charge indefinitely and wouldn’t have wished non-continuity in the splendid trajectory beyond him. When it comes to the annals of Singapore, his name is etched on stone and not in sand. All these couldn’t have been without proper Organisation. Lee saw the importance of grooming the next generation to lead the nation. As the saying goes, there is no success without a successor. Organizations must transcend personalities, and leaders must be humble enough to acknowledge this.
Leaders ought to build teams centred on a mission or purpose instead of individuals. Be generous with sharing your experiences and advice with the next generation of leaders that you are grooming. Equip them with the information and knowledge they’ll need to continue growing the organisation. A great leader will ensure that those who step into his shoes have the best chance of success. It takes good and not toxic cultures to maintain that which is worth sustaining.
Organisations need to implement enterprise-wide changes affecting their processes, products and people to be able to keep pace in today’s constantly evolving business world. Change is a fact of life in businesses today, and therefore requires an agile workplace culture that enables leaders to identify and respond quickly to market changes and unexpected challenges.
Companies that consistently outperform competitors in profitability, market share, revenue growth and customer satisfaction possess superior agility to lower performers where discrimination, unfair treatment, harassment, bullying, employee-rights violations, vindictiveness and other abuses flow downhill through the company’s toxic cultural environments.
There are many other different circumstances that should prompt an organisation to recognise the need for a culture change. It could be as great an event as a merger and acquisition; or perhaps your company has recently undergone significant growth, had changes in leadership; adopted digital technologies and developed new business models; or wondering why many of your good employees are pursuing careers elsewhere, not to mention large amounts of office gossip.
These signs indicate that it may be time to overhaul your company culture. Good organisations through their leads check the pulse of how employees feel; in fact, they have a knack for recognising a toxic work culture and therefore assume a front-line role for launching a critical culture change in the workplace via managing and influencing same. Failing to adapt quickly enough against these odds brings risks of becoming obsolete.
The transformation imperative cannot be achieved without essentially connecting culture change. Culture is contagious, and so a company that delivers a good-to-great employee experience through culture by fostering proactiveness, optimism, problem-solving attitudes will definitely rub off on employees and create a positive environment.
A recent study by Boston Consulting Group found that companies which focus on culture are five times more likely to achieve breakthrough results in their transformation initiatives than those that don’t. It’s about time leaders appreciated that culture is dynamic and change will happen in their organisations even if they do nothing to guide it. Employee values, mindsets and behaviour evolve rapidly.
Adaptive Corporate Culture
For an organisation and its workforce to respond effectively to change without losing productivity, Adaptive Corporate Culture is the tool to deploy. It builds on the principles of Psychological Responsibility and Sharing Responsibility for Future Success of the Organisation; and adds the elements of culture that heavily influence trust, commitment, motivation, kinship, concentration and social engagement. These are the attributes that form psychologically healthy organisations and make them perform at their peak.
The framework’s ingredients are designed deliberately to help create the tone, atmosphere and expectations of a psychologically healthy organisation that envelops the workforce and influences its attitude and approach to work. The culture also uses the organisation’s health as a stimulus for peak performance. The cultural expectation is that the organisation achieves peak performance through the workforce’s enhanced psychological wellbeing.
The Seven Elements of Adaptive Culture
These are consistently seen in businesses which have transformed successfully. They provide the cultural foundation necessary to support rapid adaptation, innovation and organizsational resilience.
Customer-centricity and ecosystem focus are the critical reference points for defining organisational strategy and priorities. These elements are the ‘North and South Stars’ by which the organisation orients itself and pursues opportunity through focusing on the customer and the network.
Four other elements – analytical orientation, collaborative reflex, bias to action, and a learning mindset – concern the capabilities and ‘habits of mind’ which shape employees’ day-to-day work experiences. Finally, the leader as enabler is the essence of how leaders add value when working with their people and teams – by empowering and developing them while holding them accountable.
While these elements are unlikely to all be equally important for your organisation, they are all likely to be relevant to some degree. The place to start is assessing your organisation’s current culture. From there, it’s helpful to think about the relative importance of these elements for your organisation’s future and identify the most significant cultural gaps.
According to Klepper, 1997, Organisations normally go through four main changes:
- Formative Period – This is when a new organisation is just getting started. Although there is a founding vision (the purpose of the organization), there are no formal definitions. This is just as well, because there should be a lot of experimentation and innovation taking place. These changes of creativity and discovery are needed to overcome obstacles and accomplish breakthroughs.
- Rapid Growth Period – Direction and coordination are added to the organisation to sustain growth and solidify gains. Change is focused on defining the organisation’s purpose and on the mainstream business.
- Mature Period – The strong growth curve levels off to the overall pace of the economy. Changes are needed to maintain established markets and assure maximum gains are achieved.
- Declining Period – This is the rough ride. For some organisations, it means down-sizing and reorganisation. To survive, changes must include tough objectives and compassionate implementation. The goal is to get out of the old and into something new. Success in this period means that the four periods start over again. Failure means the end of the organisation is near.
Understanding which stage of growth your organisation is in will drive the change strategy. For some organisations the four periods of growth come and go very rapidly, while for others it may take decades. Failure to follow-through with the needed changes in any of the four growth periods means death of the organisation. The Japanese have a term called ‘kaizen’, which means continual improvement. It is a never-ending quest to do better. And you do better by changing. Standing still allows your competitors to get ahead of you.
Change Management Models: It is appropriate to solidify the articles with the McKinsey 7-S Model which introduces 7 factors for collective change, and the Kurt Lewin Change Model respectively.
The essence of McKinsey’s 7S model is that a firm is the comprehensive sum of its parts, and that the internal dynamics of an organisation clearly determine that organisation’s ability to compete – the premise being that both the strategy and structure of the organisation determine management’s effectiveness.
Though this model takes time to implement, it however remains widely used today. Most companies tend to prefer this model for enacting major changes because it’s easy to use. The model works whether the changes are strategic, reactive or pre-emptive.
“If we don’t change, we don’t grow. If we don’t grow, we aren’t really living. ~Anatole France
Change management doesn’t necessarily mean stability is out the door. For change to be effective, stability and change must be held in proper balance to achieve total benefits. Stability ensures the current business model is effective and efficient, while change is focused on implementing the changes necessary to be more effective in the future. The two must co-exist. The stability to change ratio depends on the people, organisation and environment in which a business operates.
Today’s business world is highly competitive and the global market place is constantly evolving. The winners and losers of this global competition are determined by one factor: Change! Companies must learn how to embrace change and treat change management as a critical discipline. Change management is about people. More emphasis should be given to the people who are responsible for adopting the new system to ensure the change initiative is successfully implemented. The easier you can make this journey for people, the sooner your organisation will benefit, and the more likely you are to be successful.
Changing Organisational Culture – Cultural Change Work-In-Progress by Mats Alvesson & Stefan Sveningsson
Strategic Thinking – An Executive Perspective by Cornelis A. De Kluyver
In Search of Excellence (Lessons from America’s Best-Run Companies) – Tom Peters and Robert H. Waterman Jr.
Why Every Executive Should Be Focusing on Culture Change – https://sloanreview.mit.edu/
The writer can be reached via [email protected] Tel. 0244651663/0208178791