6 easy steps to building a high-performance culture
Mitchell Osak | March 19, 2014 8:14 PM ET
Justin Sullivan/Getty ImagesA Google employee plays pool at the Googleplex in Mountainview, CA. Google was a pioneer of the philosophy that fun and relaxed work environments breed creativity, productivity and innovation.
When it came to defining the number one driver of organizational performance, no one hit the nail on the head quite as well as esteemed management scholar Peter Drucker who stated unequivocally, “Culture eats strategy.” Drucker understood companies that build powerful cultures tend to outperform their peers over time. However, building or revitalizing a culture is easier said than done. The challenges should not prevent leaders from embarking on what will be a long and potentially painful journey. Where do you begin, especially in mature organizations?
A culture is an organization’s norms, practices and values as defined by its senior leadership, history and market position. Culture is vital to corporate and employee performance in that it acts as a mobilizing spirit, an enterprise-wide lingua franca, and a strategic anchor. Building a vibrant culture is equal parts strong leadership, defined values, effective change managment and supportive organizational tools.
Research has found that firms with high performance cultures (which include strong organizational competencies like rich communications and focused leadership) will significantly outperform their competition. For example, a 2007 McKinsey global study on organizational and cultural performance (encompassing 115,000 employees across 231 organizations) found companies scoring in the top quartile are 2.2 times more likely to generate superior profitability than likely bottom quartile companies. It is no coincidence that many market leaders such as P&G, Apple, Zappos, Google and Disney are known for their strong, enabling cultures.
Given today’s hyper-competitiveness and rapid diffusion of technology, maintaining a vibrant and distinctive culture may be one of the few areas left where managers can generate long-term competitive advantage.
Nurturing transformation is not easy. It will falter without a sustained leadership commitment and changes to management systems. According to Chris Boynton, principal at human capital consulting firm Red Chair, “Culture is the way we do things around here, so the ideal way to change the culture and make it stick is to get the leadership front and centre, and align the management systems around the desired change.”