Managing Cultural Change

Defining Culture

Organizational culture is the pattern of shared beliefs created as a group learns how to solve problems, and then passes on that learning to new members. Culture consists of:

  • Values. The underlying assumptions or ‘truths’ created through shared learning and experience. Values inform people how to perceive events, analyze new information, and emotionally react to new situations.
  • Practices. The tangible things we experience, see, hear, and feel in an organization. Commonly they include programs, policies and procedures, roles and responsibilities, and forms and other documents. Broadly they may include language and acronyms, dress standards, and how work space is designed.

Common Mistakes

Organizations may try to shortcut the process of cultural change by:

  • Changing practices without changing values. Leaders often create new programs or policies without attempting to change the underlying beliefs that guide individual choices. Employees and supervisors who don’t believe in the change will at best not support it, and at worst undermine it.
  • Confusing ‘espoused’ values with underlying values. Leaders often develop and publish new values, but forget to work on changing employees’ beliefs about how the world works.

Creating New Values

Challenging employees’ fundamental beliefs creates anxiety, and often results in distorted perceptions and defensive behavior. Effective change requires leaders to help employees:

  1. ‘Unlearn’ current beliefs. Leaders must provide overwhelming evidence that illustrates how current practices either threaten the organization’s existence, or prevent critical change. Leaders should be prepared to provide real data, compelling stories, and clear vision.
  2. Overcome anxiety. Even when employees accept that change is necessary, they still need help overcoming the natural anxiety that change creates. Change often results in the fear of looking incompetent, losing status, and learning new ways of doing business. Leaders should create a safe environment for employees to learn new practices through training, mentorship, modeling, and other support systems.
  3. Learn new values. While new values can be adopted, underlying beliefs must be learned through experience. As a group experiences repeated success using new values to solve problems, new assumptions will be created and integrated into normal business practice. To replace current beliefs with new ones, leaders must create opportunities for shared learning. New ‘hero stories’ need to be shared and promoted so that employees and supervisors see that the new values result in success.

Creating New Practices

Practices are the outward representation of underlying beliefs. Practices affirm and reinforce an organization’s core values. If practices are inconsistent with an organization’s stated values, managers and employees will question their validity, and revert to ‘business as usual’. The following areas of organization practice are critical to managing cultural change.

  1. Executive Commitment. The Chief Executive communicates to managers and employees his/her commitment to the values. Senior leaders and managers repeat and cascade the commitment in their regular business communications.
  2. Organizational Performance Management. Values are represented in the organization’s vision, mission, and strategic plan. Values are integrated into goals, objectives, performance measures, and strategies. Accomplishments that illustrate the values are shared in organizational performance reviews and reports.
  3. Policies and Procedures. Policies and procedures reflect how the values are integrated into business standards and practices. Use of equipment and tools, forms and reports, and other resources is consistent with the values.
  4. Roles and Responsibilities. Roles and responsibilities are assigned for promoting and adhering to the values. Specific responsibilities for leaders, managers, supervisors, and line staff are communicated and documented in position descriptions.
  5. Management Accountability. Expectations for promoting and managing the values are integrated into supervisor performance plans and evaluations. Supervisor performance is systematically reported to senior management. Supervisors who fail to meet expectations are subject to corrective action and/or discipline.
  6. Employee Performance Management.
    • Values are cascaded down through the organization and represented in employees’ individual performance plans. Values are integrated with behavioral competency requirements. Key results expected, performance targets, and individual development plans are consistent with the values.
    • Supervisor coaching and feedback reinforces core values. Achievements that demonstrate the values are acknowledged and documented in evaluations.
    • Managers take swift action to correct behavior that violates the values. Misconduct is either corrected or offending employees are removed.
    • Employees who model the values are recognized. Values are integrated into formal recognition and reward programs. ‘Hero’ stories about those who model the values or show leadership are shared with the entire organization.
  7. Training. Supervisors receive instruction on how to integrate the values into employee performance management practices. Employees are taught the values and how they are represented in the organization’s vision, mission, and strategic plan.
  8. Resource Allocation. The Chief Executive and senior leadership allocate sufficient resources (e.g., staff, budget, and time) to implement new programs, training, and performance management systems.
  9. Employee Confidence Feedback. The organization regularly solicits employee feedback on organizational values and practices. Employees consistently express confidence in management’s ability and success in managing organizational culture.