You know what culture is but can’t define it
A to the point definition of culture that you can actually use.
Culture is a term that many of us have an intuition for, but try and define it, and you might find it surprisingly difficult. Years ago I interviewed a range of C-Suite across organisations like IBM, Australia Post, and the sort of definitions I got were “culture is the interwoven fabric that impacts all aspects of your business”.
It is fair to say that the term has been mugged of meaning and usefulness for most leaders, wrapped up in fake values and purpose statements that are unrepresentative of the company.
So, let’s bring some sanity back to the conversation and define culture in a way you can actually use it.
What is culture
Culture is the predominant pattern of thinking, feeling and acting within a group. In organisations, which is our interest, think of it as the average way in which people think, feel and act.
Example 1:
Think: At Amazon, a normative belief is that delivering outcomes to the customer is the most important goal.
Feel: People as such feel excited and motivated to deliver outcomes to customers.
Act: People act in customer-centric ways.
Example 2:
Think: at Theranos, Elizabeth Holme’s company, a core belief was that they were revolutionising blood testing and in doing so would disrupt healthcare.
Feel: people felt immense pressure to meet lofty goals, often under fear of retaliation of failure.
Act: leaders hide negative results, misrepresented capabilities and avoided transparency.
An important part of the definition is ‘predominant’, what matters is which behaviours are the norms within the organisation. Within act, it includes norms of how things are done — for example a PowerPoint presentation culture versus a written memo culture.
Think—feel—act loop
The 3 aspects of the definition are interrelated. How people think (their beliefs, values), influences how they feel about certain things. How they feel influences how they act. How they act influences how they think and feel.
We’ve already shown this loop in the two examples. If people believe the most important outcome is delivering value to customers, it influences how they feel about delivering value to customers, and as such changes how they act. When they do what they think is best for the customer, it reinforces that this is the right way to think and reinforces how they feel.
This reality can be either a blessing or a curse. If you have high-quality beliefs that are conducive to performance, then it creates a virtuous cycle of positive behavioural norms. If you have low-quality beliefs, then it can create a death spiral.
For example, a belief that getting to the truth matters more than being right, leads to a culture with greater candour, which leads to better answers to questions, which leads to better success, and reinforces itself in a cycle.
As a counter, a belief that you will be told off for disagreeing with the boss, leads you to fear disagreeing, leads to less candour, which reinforces the belief and builds resentment by employees and bad answers to questions as you rely entirely on the leadership.
Why does culture matter?
You might be thinking do I really care about how my people think, feel and act. The above virtuous-death spiral juxtaposition already indicates why it matters. But ultimately, the right culture leads to 4 outcomes:
Better business performance — the group will be more effective and efficient at achieving goals and ensuring the right goals are in place.
Better connectedness — the group will be happier, feel more like a big team and so drive employee engagement.
Better growth — individuals in the company will be pushed to be their best, using their potential for the company and for themselves.
Higher ethics — decision-making is likely to be more ethical, considering the net benefit that the organisation delivers in the world.
Working backwards from behavioural norms
Because of the think-feel-act loop, a tangible way to analyse your current and desired culture is from the perspective of behavioural norms. Are people candid? Do people have a bias for action? Do people use company resources as if they were their own? Do people hold each other to high standards?
From here, you can examine what are the conducive beliefs and ways of feeling that will lead to these behavioural norms. For example, for candour, where people are proactively honest with each other when it is beneficial to do so, a feeling of psychological safety matters, which comes from beliefs that you won’t be told off for sharing your opinion and so forth.
Example norms that are desirable
The following is my opinion of some norms that are conducive to achieving the 4 outcomes of performance, connectedness, growth and ethics.
Candour: employees proactively state what they perceive to be true, even if it is uncomfortable to do so.
High standards: employees hold themselves and others accountable to delivering excellent performance.
Continuous improvement: employees spend time each week deliberately seeking to improve themselves and the company.
Bias for action: employees proactively make and execute decisions rather than asking for permission.
Ownership: employees make decisions as if the organisation’s resources were their own.
Stakeholder-centricity: employees act to deliver the greatest perceived net benefit to all stakeholders.
Takeaway exercise
Culture is the predominant ways of thinking, feeling and acting in your organisation. Reflect on what are the norms you desire, where are you today, and what can you do to start shifting towards the desired norms. Selecting 1-2 things to improve on tends to work best.