Strengthening Organizational Culture Improves Performance

In their book “Corporate Culture and Performance” John Kotter and James Heskett provide valuable insights into the impact that a strong organizational culture has on the long term performance of the organization. Their conclusions reinforce a popular quote: “Culture eats strategy for breakfast.” Although the original author of this quote is not clear (many think it was Peter Drucker) the importance of it is clear. It is much more difficult to make significant changes to organizational culture than to organizational strategy. To be an effective leader, you must ensure that the organizational culture and strategy are strengthened and aligned to ensure that employees will act as you hope and expect them to, particularly when the going gets tough.

There are many ways that a leader can nurture and reinforce organizational culture. First, he or she must ensure that the reward systems are consistent with the culture. Many organizations are adopting reward systems that account for both ‘what’ and ‘how’ employees achieve. “What” are the measurable results. “How” is the way that results were achieved. This is where character comes in. Organizations that nurture and reinforce a positive character in their organizational culture typically achieve better results.

Leaders also influence organizational culture by role modelling actions that are aligned with the cultural norms they are communicating. They must use language that reinforces employees’ assumptions about what is important. Symbols and ceremonies are important influencers of culture. I remember watching a CEO eliminate executive parking spaces that were closest to the office entrance (he actively removed the signs) during a time when he was emphasizing the importance of all employees and the need to improve lines of communication between the executive group and the rest of the organization.

Recruitment and on-boarding strategies can also have a dramatic impact on organizational culture. In organizations that place importance on both what is achieved and how it is achieved, hiring managers should ensure that they are assessing both the skill of candidates as well as their character attributes. Hiring tools such as the MERIT Profile Assessment™ can assist in measuring competencies relating to character.

In summary, great leaders have a clear vision of the type of organizational culture that is required to support the organization’s strategy and they actively manage the various elements that reinforce the desired culture.

Dave

David Town, CHRP, is a facilitator and coach of leadership and management principles that enable individuals and organizations to build greater leadership competency, resulting in higher performance and higher employee engagement. David has a particular focus on effectively managing conversations involving confrontation or conflict. As well, he provides insights and assessment strategies for integrating character competencies into leadership skills resulting in increased trust and reduced risk for leaders. David is President of Your Leadership Matters Inc.