Good afternoon, and welcome to the webinar hosted by Eagle Hill Consulting, “Corporate Culture: Do Your Practices Align With Your Priorities?? Just a few words on logistics for today’s webinar. All the attendees are in listen only mode, but we do want your questions. If you have a question during the session, please just type it into the question box on your control panel and we’ll answer those following the report overview.
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Our agenda for the session is as follows. We’ll go through introductions, key findings, best practices, and then we’ll take your questions. We have two speakers on the webinar today. The first is Melissa Jezior. She is President and CEO of Eagle Hill Consulting. And also we have on the webinar John Boochever. He’s the financial services lead with Eagle Hill Consulting. And with that, I’ll turn the presentation over to Melissa.
Excellent. Thanks, Kelly. Well, welcome, everyone. I’m excited to talk to you about one of my absolute favorite topics, culture. So first we’re going to kick off with doing a little level set on what culture is and talk about why it matters. Okay, so let’s talk about what culture is. And I think there are a lot of different definitions out there.
One of my favorite definitions, because I just think it’s super simple, is that it’s “the way we do things around here.” And if you think about it, it’s really about everything that’s probably not written down or documented in your organization that makes up your culture. It really is that collective group of shared assumptions that guide people in an organization.
And a silly example I like to give, but I think it kind of highlights what we’re talking about, is I remember when I was a new associate at a large consulting firm and I had to go somewhere or another around 5:30, and so I got up to go leave. And my team lead looked at me and said, oh, Melissa, I see you’re taking a half day today. Now it’s a silly example, but as you might imagine, I never left at 5:30 again, right? And it became really clear that the way things worked around there was that you didn’t leave that early in the day.
So I think we’re looking to uncover, in this conversation, how can you figure out what those unspoken rules are within your organization and then how do you work to actually change them.
Okay, so why does culture matter? I think that at the core of it culture is what ultimately steers business results, and I think that’s for better or for worse. And for better I think when you clearly define your culture, and it’s understood by the workforce, and you measure it, and you manage it, the end result is really great peak performance, not only for your organization, but for your employees.
I think on the flip side a toxic culture can either decay, or even worse, destroy your team or your organization or your company. And I think back to my own experiences, and I’m sure I’m not alone, being the only one that’s been involved in a toxic culture.
When you are involved in a toxic culture, oftentimes, if you think about it, it’s hard to focus on anything other than the toxicity that surrounds you. And when you [think of] so many different examples of culture gone wrong in the news right now, with companies like Wells Fargo or Boeing, then it really becomes apparent that it’s so important, and increasingly important, for companies to remain competitive is to really nurture that culture and create the best culture that you possibly can in order to stay ahead of your competition.
So if you turn to the next slide, C-suite and our culture survey. We’ve been really working over a series of different surveys and research to continue to invest in understanding more about culture. And so with this installment we wanted to really dig into the C-suite and see what they had to say and what they thought about culture.
So we worked on trying to understand three questions: where do C-suite leaders prioritize their own company culture, what management actions are they taking to invest in their company culture to achieve business goals, and what does focusing on culture really mean for today’s leaders.
So we conducted an online survey of 56 C-suite executives from a large sample of industries and we polled executives on aspects of org culture, including cultural priorities, challenges, metrics, and successful practices to answer these three questions. All right, so let’s, before we dive into the data, we wanted to summarize kind of the three key things that the data told us. So the data told us that one, corporate culture directly impacts financial performance and competitiveness.
Two, that the C-suite recognized the importance of culture, but there somehow lacks—sorry, but there’s not accountability there. And No. 3, organizations are not being deliberate about planning and prioritizing corporate culture. So with that said I’m going to turn it over to John to dive into the data and talk a little bit more about that.
Thanks, Melissa. So here’s what we found. Actually, the following three frames tell a consistent story, which is that company culture matters to the C-suite. So first we asked respondents about the perceived linkage with financial performance, and 72%, approaching three-quarters, agreed or strongly agreed that company culture directly impacts financial performance. Not a single C-suite respondent disagreed with that proposition.
Next we asked about the linkage with competitive advantage, and fully 70% of our C-suite executives agreed or strongly agreed that their company culture was a clear competitive advantage, with six disagreeing, so not a competitive advantage. I’m sort of shocked. I’d be interested to learn more about those types of companies.
And then third we asked about the role of company culture in the war for talent as a way to attract prospective employees, and 75% of our C-suite respondents agreed or strongly agreed that their organizational culture was a top reason for joining their company, with only 4% disagreeing with that.
So overall, very strong association of organization culture to some of the classic drivers of strategic performance. And I think we would be pretty confident in saying that improving company culture is a top priority for these execs. In fact we also asked this question and almost 70% agreed or strongly agreed with that. That wasn’t the surprising part to us and I’m sure to our audience listening.
What was kind of surprising to us was the disconnect between the priority C-suite level executives seemed to place on company culture and what actions or practices in their control they were actually implementing in their organizations.
Less than half of C-suite executives agreed or strongly agreed that they held their employees accountable for company culture, and just under 60% agreed that they held their leaders accountable, so 13 points higher than employees. But don’t forget about the almost three-quarters who felt company culture was a financial and competitive priority.
So turning to the next set of findings, only 60% of our C-suite respondents agreed or strongly agreed that their organizational policies and procedures were in alignment with their company cultures, so about the same percentage as those who held their leadership accountable, which kind of makes sense. Leaders set policy and procedures, after all. And lastly, again less than half, 48% of C-suite respondents agreed or strongly agreed that they monitored their culture for signs of business risk.
And this aligns with the percentage, you may recall, of those who held their employees accountable for company culture. So we find the juxtaposition of these results a little surprising. On the one hand, company culture impacts financial performance, competitive advantage, and attracting talent, and on the other we don’t always hold leaders and employees accountable for it, or align our policies and procedures to it, or monitor it for signs of risk. So we asked why is that, why the disconnect, and what can be done about it? And for that we turn back to Melissa.
Excellent. Thanks, John. So I think as we start to shift now with okay, that’s really interesting findings that we just talked through, what do we do, what can we help you all take away from today to be able to do something about and make some differences either in your own teams or your own organizations.
And if I had one thing to really impart on everyone, I would say it’s that culture I think at times feels like a nebulous kind of squishy thing. But in reality it’s something that can be broken down into components, analyzed, influenced, and changed.
And so one of the things that we really talk about with our clients is that when you start, when you—every year I know, at least at Eagle Hill, and I know many of our clients do it as well, we have a plan that we put together every year. We have a business plan we put together every year that we follow and we execute against. In fact we even have a long range, right, we have a long range strategic plan, too.
What I am urging everyone to start doing is making culture a part of that plan. If you think about it from like a sales perspective, you would never dream of building a business plan or a strategic plan without some discussion around sales and how you’re going to achieve the sales targets that you have outlined.
And I would love for leaders to start thinking the exact same way about culture. It is as important as every other aspect of your business, whether it be finance, or sales, or HR, that you have to be very intentional about it. And if you’re not intentional, culture will just happen around you. So it’s really important to elevate it and make it a priority and build a plan around it.
So now your next question might be okay, Melissa, you just said a lot of leaders already think that culture is nebulous. Well, I might think it’s nebulous, so how do I build a plan around it? Well, that’s what we want to talk about next, is we have our own framework for how we have defined culture and the components of it and how to break it down, and we want to talk through that framework as well as some ideas on how you might be able to influence your own culture.
Thanks, Melissa. Right, so organizational culture is a notoriously difficult concept in business. It’s hard to define and it’s even harder to measure. I’ve spent the bulk of my career in financial institutions, and they often think of culture as sort of this amorphous thing. Those are soft skills, clients tell me.
Well, like any squishy problem, you have to break organizational culture into its parts to understand it. And here at Eagle Hill we’ve identified five critical elements or levers that can be defined and measured: how leaders show up, trust based relationships and transparency, authenticity, employee satisfaction, and core values.
Together these levers define a company’s culture. Of course each company has a different configuration of these things, different ways of doing them, to go back to Melissa’s definition. And oftentimes clients will pull on just one or two of these levers and expect to move the whole company. But what we’ve found is you actually have to pull on all five at the same time. They work together and they reinforce each other, and that’s the way you move company culture and performance.
So this framework can be a useful tool we’ve found for helping senior leaders put in place accountabilities, prioritize investments in their culture—yes, you can invest in this, it turns out—ask the right questions and get the actionable insights they need to move the dial on their company culture.
All right, so let’s talk about the first lever that you can pull, and the first lever is around core values. So core values, I believe, is really the foundation of an organization’s culture. It’s really…it really should be the guiding…it’s kind of guideposts that every decision that you make should be in line with your core values. There are two things that…there are kind of two things that I could recommend right off the bat that you could consider doing right away with your own, assuming you’ve got core values in place.
The first thing is build core values into hiring. I think many of you may have heard, there’s a famous article out there that talks about the brilliant jerk. And the goal here is to never hire the brilliant jerk, right? You want to make sure that you’re hiring someone that not only is technically great and really will help move your business goals forward, but really fits in well with the core values that you’ve already established.
If you can find someone that has already naturally aligned with your core values it makes that integration and assimilation into your company so much easier. So I think right from the get-go we right now, we’ve got four core values and those are all integrated and seamless in our own recruiting process. And we evaluate our core values as strongly as we would evaluate someone against our technical criteria.
The second thing that I recommend is not only modeling the core value behaviors, but holding employees accountable for the core values, for actually demonstrating those core values. So, for example, when you’re communicating with your organization or your team, core values should be a very prominent thing that you’ve got featured in almost all of your communications.
I talk about core values on a daily basis, sometimes even an hourly basis. It’s something that if I say someone’s done a good job, I try not to just say good job, but I try to explain why they’ve done a good job and then tie it back to one of our core values. So I think really making sure that not only are you showing people how to be a good kind of corporate citizen, but you’re then also giving them feedback if they’re not being that good corporate citizen with how they’re showing up in their behaviors in terms of not demonstrating those core values. So those are just two things to think about in terms of how you might be able to further your own core value lever.
All right, the next thing is leadership. So a couple of things here. Leadership, I can’t think of a faster way to tank an organizational culture than to have leadership that is not really living and breathing your organization’s core values. So one of the things I always recommend folks do is to sit down and think about who of your leaders are cultural detractors, who are cultural champions, and maybe who are culturally neutral, and then for each of those groups you need to have a plan that you think about. How should you be standing up and putting the cultural champions in a spotlight to make sure that you continue to reinforce those core values, you continue to reinforce those behaviors.
And on the flip side, how do you take your cultural detractors, how are you giving them the feedback, and sometimes hard feedback and hard conversations so that it becomes very open and transparent what you expect of them in terms of their cultural, the cultural norms and how they may be detracting from that so that together hopefully you can move the needle in moving them from, you know, ideally champion, but even not a champion, culturally neutral. Okay, on to the next one.
Thanks, Melissa. So core values and leadership are two of the main enablers of workplace culture. Relationships are how culture is experienced and shared. “Harvard Business Review” explains culture as the, quote, “tacit social order of an organization,” the key word there being social.
And the underpinning of any social order is trust. And it turns out that trust-based organizations have pretty distinct characteristics, in our experience: do I walk the talk, do I do what I say I’m going to do when I said I would do it, am I committed to investing in myself, learning, improving for the benefit of the group, does my team have my back, do I communicate in clear, concise, transparent ways has been alluded to. The degree of trust felt by members of a team turns out to be a really good predictor of a high performing organization. So some practical actions for you to consider here include one, localizing your culture.
That’s a fancy way of saying push culture down into the organization by providing employees with smaller group networks to foster relationships that cut across your formal company boundaries. Here at Eagle Hill we’ve implemented career families to give consultants informal development support and a sounding board away from their account teams or communities of practice.
And a second point is to focus on teams versus just individuals as carriers of culture. This is a trend. This can take the form of team-based goals and challenges, recognition and rewards. And because of the inherent trust in teams, teams are also a very good place to model the behaviors the company is seeking to change or reinforce. Melissa?
Excellent. Okay, so our next lever is authenticity. And how we define it, I think it’s important to pause here and say this one may not be almost as self-evident as core values or leadership, in a way. But how we’ve defined authenticity is about how well does the organization itself show up in terms of authentically supporting the culture that you have outlined.
And one of the easiest ways to see this is looking at an organization’s policies, an organization’s processes and practices to make sure that it’s actually embodying the culture that you intend to have. So a simple example of this could be, let’s say that you’ve got nimble as one of your core values. That’s really important to you in your business.
But perhaps all of your policies and your processes really create much more of a hierarchical, bureaucratic environment. Those two things would really be at odds with each other. So one of the things we recommend to our clients is to sit down and do an assessment of your policies, practices and procedures to see which ones really and truly do support your organization’s culture and core values and really work on identifying which ones don’t, and making sure that you’re taking some action against those that don’t support what you’re trying to achieve. So on to the next one.
I think it’s becoming—the next one is employee satisfaction—and I think it’s becoming more and more accepted in the corporate world that employees are just as important a constituency today as your clients or customers.
They’re on equal footing. That’s been a pretty astounding evolution, but it’s become the reality. Keeping employees happy is a competitive necessity, and it goes way beyond just engagement. And it turns out that the key to employee fulfillment in the job is a function of the degree to which they have autonomy or agency in their work, in this case contributing to the culture, whether they believe they’re being treated equitably, so it’s not about absolute pay levels, and whether they have the tools and support they need to progress or even do their jobs well. All three things need to be there for employees to feel content.
So if you want to have a satisfied workforce, those are the things to focus on: providing opportunities for staff to contribute to the culture, like we have here at Eagle Hill with our internal core value teams, for example, Diversity & Inclusion, Wellness, and our Living Lab, incubators for new internal practices where all employees may contribute.
Another idea is frequent check-ins or pulse checks instead of the annual performance review. This is becoming sort of a revolutionizing of performance management. Here we’ve implemented snapshots after every project and throughout the year, asking the same limited set of questions and losing the anonymity usually associated with downward and upward reviews. We do both.
And this has become a great predictor of how employees are feeling, whether they’re at risk, and how aligned to the company they are. So I think that’s it for our prepared remarks, Kelly, so over to you if there are any questions from the audience. And thank you out there for listening.
Thanks, John and Melissa. So we are now on to the Q&A portion of the webinar. As a reminder, if you have questions, go to your control panel and just type in and we’ll read those aloud and respond to them. So it looks like we have a couple questions in the queue. The first one is you mentioned cultural detractors. Do you have some suggestions on ways to handle those cultural detractors?
That’s a really good question, and unfortunately it’s not an easy question, either. I think the first thing is identifying who they are.
And the first thing I would say is it starts with just really talking to a lot of different people in your organization and really starting to get a sense of who is or isn’t adding to the culture that you’re intending to achieve. And then once you’ve identified who those are, my first recommendation is really starting to engage in some really hard, honest dialogue about what you’re seeing, what you’re hearing, and what you expect in terms of behaviors in terms of how they support the culture. I think it’s really—culture is a series of—it’s really about your people when it comes down to it. So I think it’s about really talking to those people and starting to get a shared sense of what’s working and what’s not.
Thank you. Our next question. What are some of the questions you might ask recruits to make sure they are a culture fit?
Well, this one I think depends on what your core values are. So the way we work is we often will…our four core values are collaboration, fun, impact, and family. So one of the things that we tend to look for is in every single one of those answers, every single one of the questions that we ask we look for answers that support these core values.
So, for example, if you take a look at collaboration, right? We’re looking for someone that probably is not a lone wolf, someone who enjoys working with other people, someone who enjoys the idea of brainstorming and bouncing ideas off someone, someone who believes that two heads are better than one on every problem.
So we’re deconstructing every answer that we get to every question to find evidence about whether or not we believe we see collaboration or we see tendencies toward not collaboration. So I would recommend and encourage folks to take a look at your own core values, and look at your own interview questions, and look to say how can my current—how can I evaluate my core values using the current question set and what questions should I add that would enable me to find out more information around whatever my core values are.
Thank you. Our next question. What do you think about those who say hiring for culture creates a workforce that’s too homogeneous?
Okay, so that’s a good question. I think—and this is again probably another silly example, but I think maybe will help illustrate the point I’m trying to make.
So you think about it on a macro level. Like think about the United States. And the United States, we have a culture, right? We have an American culture. But I don’t think anybody would go as far as to say that America is homogeneous, or that we don’t have diversity of thought here in the U.S. And so I think that’s essentially what we’re trying to underscore, is that I think sometimes people confuse culture with the thought that when you’re hiring you’re trying to hire for someone that thinks like you, looks like you, talks like you, is like you.
And that’s actually not what we’re trying to do. What you’re trying to do is you’re trying to identify, like going back to core values, you’re trying to identify people who are similar in ways that your core values represent. So again, in our case it’s family, impact, fun and collaboration. We’re looking for similarities of thought around those four things.
We’re not looking for similarities of thought, period. We’re looking for people who have shared values, and in our case around those four things. So I think that’s a really important distinction.
Thank you. The next question. How do you get started developing or updating core values? Are they set in stone or can they evolve?
John, you want to take this one? I’ve been chatting a lot. [Laughs.]
[Laughs.] I’m happy to give this one a shot, Melissa. So absolutely they can evolve. I mean, we’ve been making the point that core values represent intentionality on the part of the C-suite. Many companies across our industries—healthcare, financial services, media—have actually grown through mergers and acquisitions and integration.
It turns out this is the perfect opportunity to put a stake in the ground on a new set of operating values and principles, so it sort of starts there and it can be a fun facilitation process with the C-suite to arrive at what those new operating or evolved operating principles will be that cover the whole enterprise.
In a way, though, that’s the relatively easy part. Where you go next is the key, in my experience. And what I’ve seen work really well is to establish a group, call it a group of culture carriers, who best exemplify the operating values, the operating principles that you’re seeking to inculcate. And some of the devices that group—and by the way, that group is across levels, across departments intentionally.
But it’s really important to manifest how these values are supposed to show up. And so the use of things like story books to exemplify the behaviors and a lot of visual reinforcement can be effective ways of cascading those core values throughout the organization.
Thank you. The next question. Could you talk a little bit more about the snapshot tools? Are those interim employee check-ins in the evaluation process? What type of limited questions are included in those?
Cool. I can take this. John, feel free to jump in. So the way our snapshot process works is, as John mentioned, we pulse our employees at a minimum of four times a year, asking a standard set of eight questions.
But often this is at the—but a minimum of four, but it takes place at the end of every project, so whatever kind of comes first. And we ask four standard questions. And also as John mentioned they are anonymous—they are not anonymous, I’m sorry. And the results go to the team lead.
And we encourage a conversation to take place where we ask the employee and the team lead to sit down and discuss the individual’s answers on the eight questions. And we ask things, everything from how do you understand what’s expected of your role, do you feel like you’re surrounded by people who share your values, do you feel like you can use your strengths every day, and so on and so forth.
And these eight questions we hope prompt conversations that enable the team lead to be able to do something about the person’s answers. We hope it creates a way for, as issues arrive, a really safe place to be able to talk about these things and a place for the team lead to be able to make changes.
And it’s funny. We’ve been doing this now for about a year, year and a half, and when we first implemented it I think we were all collectively wondering how the removal of anonymity would actually work and whether or not we would find employees would be honest in their snapshots. And actually what we have found is we’ve found that people use the whole five—it’s on a scale of 1 to 5—that people really and truly use the full five point scale.
And what we have found is that really and truly people are being honest and we are finding that people are—it’s a way for us to have those sometimes hard conversations and creates a way for people to raise concerns and hopefully for people to address those concerns.
Thanks, Melissa. The next question. Can you give examples of how to build trust in the focus on teams? What would be examples of ways to address or improve trust?
I can take this one if you’d like.
Cool. Go for it.
So, you know, I think there are a couple things that you’re trying to achieve. And I can talk specifically to my team in the financial services community of practice. One is you want to create a sense that you’re all in this together. And you also want a physical manifestation of your commitment to each other and willingness to hold each other accountable.
So what we’ve done in my group is to—using, of course, the leadership development criteria of the firm—come up with a set of goals against each of our core priorities which incorporate values and then share that with each other. So obviously I’m the most senior person, but we do this across levels. And we do it sort of item by item, so clients, intellectual capital, firm, people. And this has proven to be really effective in promoting transparency and what the collective commitment is going to be of the team and of the team members to each other.
And I’ve been told by my teammates that it’s been the most valuable experience that they’ve had in years in their time here. I think we all left really positive from that process and we’re in the process of sort of executing it on a quarter by quarter basis.
Thanks, John. The next question. I run a small manufacturing business with a total of 29 employees and there’s three layers. Culture is very important to me. We aim to have more fun and succeed in some way to create a family feel. Do you have suggestions on how I would handle getting two managers to better exemplify our core values?
Okay. I can start on this one. Again, John, jump in if you have anything to add.
So I think the first thing I would say is probably spending time thinking about what you mean by family feel. And I always often encourage folks to spend time thinking about the behaviors that you attribute to that particular core value. So in our case family is one of our core values. I also started the organization with my father and work with my mother as well, so in my case family is very much a part of the organization.
And what we’re trying to impart at our organization is really a—it’s really and truly about being supportive. And how do we make sure that we’re supporting our people as you would, I believe, with someone in a family, both personally and professionally. So some of the things you might be able to do and think about if you’re thinking about something similar is how can you personally model some of that behavior.
So is one of your employees going through a hard time? Can you very visibly make sure that you are supporting that employee through their difficult time? Are you celebrating as a unit and as a family? I think that’s another great way to be able to really model family behavior. Are you celebrating each other’s wins and successes together?
The other thing I could think about would be are you seeing things that directly conflict with some of the family feel that you’re trying to create, and to sit down and give them some of that feedback might be another couple of things to think about. So those are a couple things off the top of my head. I don’t know, John, if you have anything to add.
Nothing to add on that one.
Thank you. Our next question. How hard is it to realistically measure employee engagement and satisfaction?
That’s a good question. I would say it’s not that hard to measure it on the surface, but we… So we see sort of a spectrum along the engagement and satisfaction continuum. There’s sort of being represented, being included, and then sort of belonging. There’s an evolution there. So in some ways the realistic measurement is only as good as sort of the depth of the questions you ask, and so it’s really important to design your engagement and satisfaction surveys to get at that actual sense of belonging by asking those kinds of questions.
Does the team have my back? Do I feel welcome? Do I feel like I belong? Those types of questions. Most commercial surveys don’t get at that level and that’s what you need to strive for.
The other key part of this question, it seems to me, is the repetition. So it’s not good enough to just try to measure this once or twice a year. Too much can happen, and you can’t go deep enough. It’s only through the repetition and the frequency that you discern patterns, and it’s those patterns that provide insight and prediction. So easy to measure on the surface, really hard to get to the real meaning under it.
Thank you. Our next question, looks like we have time for one more question. I’ll read that out loud. How do you connect culture to strategic implementation process and measurement?
Okay, I can jump in and take this one. I think that—okay, so first off, assuming that you’ve got a culture plan that you’ve identified with some specific objectives, I think the next key thing is making sure that it is part of your regular dialogue and your regular leadership meetings in terms of are you achieving what you set out to achieve.
So, for example, this morning I just had a meeting with some of my leaders where we had an hour long meeting. I think today we probably spent 40 minutes of that 60 minutes talking about some of the culture goals that we had set out for ourselves this year and things that we thought were going well, things that we thought we needed to focus more on, things that we needed to tackle.
It should be, again, just like I was talking about earlier, it needs to be as important as a financial goal or an HR people goal. Like it is something that you need to watch, you need to talk about, and you need to be very intentional and deliberate about.
Thank you. So we’re right at 2:45, and this concludes the webinar. If we did not get to your question we will follow up with you on email to respond to the question, but we do want to respect everyone’s time and end right on time. So again we thank you for your participation. If you have any questions or comments, feel free to reach out to us. We can be reached at 703-229-8600. You can also find us online at www.eaglehillconsulting.com. So again, thank you for your time and attention and we look forward to speaking with you soon. Thank you.
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