Our recent research posed this question: if the culture of your workplace is to become as good as it realistically can, how much will people’s performance and productivity improve?
Of the senior leaders who responded, 91 per cent estimated a 20 per cent or more improvement in performance if the culture were improved. Of the middle managers who responded, 58 per cent felt a 50 per cent or more improvement would be realised.
Anecdotal evidence from working with leadership teams reinforces the large gains that can be made in performance if the culture is improved realistically.
Many leaders think culture is a function of luck or chance. They feel unlucky if the combination of personalities in the team or organisation results in a poor culture. Likewise, if their culture is positive, they feel they are lucky.
These leaders fail to come to terms with the fact corporate cultures can and should come about by design if there is a concerted push by leaders to drive a positive, productive culture. It can be argued that in not assigning culture as a priority, leaders are abrogating a primary responsibility.
Successful leaders identify their culture, as the bedrock on which performance rests at an individual and collective level, as a key strategic priority.
Culture is not left to chance and it infiltrates all aspects of the business, starting from the process of selecting a new hire.
With clarity about the kind of culture necessary to make the company successful, alignment with the aspiration culture occurs at various levels including performance reviews, what gets recognised and rewarded, and how staff members are promoted and let go.
Human resources should play a big role in culture change initiatives. It can be argued that in the past HR has not been fully engaged in the culture space.
Having said that, to assign responsibility for culture change to HR ignores that leaders across the business need to drive and be committed to culture change. Successful leaders recognise that corporate culture change cannot be delegated to HR.
A trap leaders fall into is having commitment to culture change while lacking the capacity or desire for introspection.
Leaders are the primary, though not sole, drivers of culture and, as such, need to consider how their actions, or inactivity, contribute to the prevailing culture. This needs to start with the senior executive team exploring how individuals behave as leaders, how the executive team functions, then flowing down to the next level of leaders.
Recently Deloitte Access Economics released the Westpac Businesses of Tomorrow report. The report cites the potential for a $70 billion growth in the economy should the gap in management effectiveness between Australia and leading nations be closed. This alone would represent a 4 per cent lift in gross domestic product.
According to the report successful leaders, those who achieve a 3 per cent above average revenue growth, are characterised by their connection to others, international experience, a core set of skills and a fit-for-purpose education.
While the report paints a profile of what successful leaders look like, it falls short of detailing how leaders achieve above-average growth. That’s where corporate culture comes into play.
Successful leaders focus on enabling a culture that will get the best from their people.
Steve Simpson is the author of A Culture Turned.
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