In a recent blog ("4 Great Ways to Become a More Innovative Company"), I wrote about CEOs and other executives who typically have spent much of their leadership time at the head of a successful ship. But when it comes time to adapt to change, they have a hard time keeping their companies afloat when the market winds shift and they need to rethink strategies to change course. Do they just need to add some innovation? Or do they have to change their culture?
Maybe a little of both. How does that kind of change actually happen?
Let me tell you a story.
At my consulting firm Simon Associates Management Consultants (SAMC), we've been working with a Fortune 500 company whom I'll call “Client X.” The challenge before us is to figure out how to reconcile, on the one hand, a business that has grown to dominate its market by doing things well in one particular way, with on the other hand, changing customers who are demanding new things from their network of retail outlets.
Additionally, and almost right on cue, new managers from Generation Y are rising in this company's ranks and proposing new, innovative ways of doing things. A big collision is coming.
The initial innovations that pushed growth have plateaued, and most of the executive leadership has invested their careers in building up the existing business model (and done so quite successfully).
The market is demanding that this company innovate again to stay relevant, but this will take a major corporate culture shift. In fact, if they thought about who was going to be their customer in 3-years they might realize that they had to rethink their company, its values, beliefs and behaviors sooner not later.
Corporate Culture Change: The OCAI Assessment
In a Forbes article entitled "9 Leadership Steps to Change Corporate Culture", Micah Solomon outlines steps that emphasize planning and personnel. He recognizes that changing a corporate culture is not something that happens in a handful of meetings or just because a few people want it to. Changing corporate culture takes a commitment and sustained effort.
When Client X called us, they had already decided culture change was a priority, and they were ready to get down to business. In our line of work, that is a huge first step.
So, we got right to it. We started by having Client X and its staff members take the Organizational Culture Assessment Instrument (www.ocai-online.com if you would like to take it yourself). The OCAI is a powerful tool for assessing an organization's current and preferred organizational culture. Developed by Robert Quinn and Kim Cameron, professors at the University of Michigan, this tool is used to give a baseline reading of where a company is at and where they want to go in regard to culture.
How Does The OCAI Work?
In any organization, from huge corporations to fledgling startups to medium-size non-profits, there are four types of corporate cultures that dominate across the globe. The OCAI is a remarkably simple way to capture the core values, beliefs, leadership styles and behaviors that people within a company embrace today and might wish to change in the future. The layout begins with The Competing Values Framework.
Quinn and Cameron statistically analyzed 39 indicators of organizational effectiveness and identified two polarities which they say makes all the difference. Within this framework, organizations are constantly choosing between:
- Internal focus and integration - or - External focus and differentiation
- Stability and control - or - Flexibility and discretion
Based on those decisions and tendencies, OCAI categorizes four organizational culture types which I summarize here so that you can get the idea:
- Clan culture: This is the kind of workplace that feels like a family. There is a strong sense of loyalty and tradition, along with an emphasis on teamwork, participation and consensus.
- Adhocracy culture: This environment emphasizes creativity and risk-taking. Innovation is prized and long-term goals are built around growth. Individual initiative and freedom are encouraged and rewarded.
- Market culture: These workplaces focus on getting things done and are led by hard-driving leaders who emphasize market penetration, reputation-building and profitability. The leadership style is built around competition, both internally and in the market.
- Hierarchy culture: This structure is highly formalized and structured, where procedures and protocols win over creativity and innovation. The goals are built around stability and organization. The management focus is on control and efficiency.
Analyzing Client X's Culture
When we went through this exercise with Client X’s leadership team, here is a graph of what we found:
NOW: The red areas show how employees believe their culture is today — very collaborative and clannish, as well as market-driven to compete for results.
PREFERRED: In the future, the team would like to see the company's culture shift to become more innovative and encourage empowerment, decision-making and idea-generation. This doesn’t mean that they want everyone doing their own thing — that would be chaotic. But it does mean that they collectively see a need to shift the focus toward encouraging respect for risk-taking and innovation, even as processes and controls remain in place.
Using the OCAI Assessment is a powerful starting point for getting your team on the same page about where they are and where they want to go, and starting the kind of conversations that make room for a
Want To Learn More? You can read here Culture Change or these three blogs that are relevant to the topic.
- Has Your Business Stalled? Maybe It's Time For A Culture Change!
- Want To Change Your Organization? Make It Like An Exciting Play.
- Why Change Is So Scary—And Why That Dooms Businesses To Fail
And a Short Video on Culture Change
Could Your Business Benefit From a Culture Assessment? Give Us a Call.
At Simon Associates Management Consultants, we specialize in helping organizations change, grow and thrive amidst today’s changing times. Specifically, we can help you determine what your company’s culture is today and what it needs to be to take you successfully into the future. If this might be of interest to you, please contact us for a free 1-hour consultation. We look forward to hearing from you.
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