Leadership Series IV: Organizational Culture

An organization is only as good as its culture—and building that culture is not only a role for the human resources (HR) department, but it is also every leader’s responsibility. As a leader of an organization, you can help make your organization a more supportive and engaging place to work by understanding the psychological processes that impact the ways employees interact.

It is important to first define organizational culture.  Do not confuse organizational culture with a company’s strategic goals, core values, mission, or vision. Culture is not merely about the press releases the company sends out explaining their positions on things. It is also not about benefits like casual dress codes, flexible working hours, and weekly happy hours. Culture is core values plus leadership behavior. A culture is created through consistent and authentic behaviors by leadership. In other words, a culture is when the leaders take the core values off the wall and live them. Organizational culture is determined by how the organizational leadership responds to a crisis, how they adapt to new demands and how they correct an employee when mistakes happen.

Organizational culture is key in attracting new talent. Research shows that roughly 77% of talent considers organizational culture before applying. Additionally, 50% of current employees are willing to leave their current employer for a lower-paying opportunity with a better culture. It goes without saying that organizational culture is the number one indicator for employee satisfaction and the reason why employees stay at their jobs. 

Time and again we learn that organizational culture is rather fragile, and it should never be taken for granted. As a company grows or is faced with new challenges or market demand, the organizational culture becomes harder to maintain. Organizational culture must be nurtured for it to grow in the right direction. 

 Organizational culture is important in the development of traits necessary for business success and the organizational bottom line. Research shows that organizations with healthy cultures are 1.5 times more like to experience revenue growth of 15%.  Despite this data, only 30% of HR personnel believe they work in an organization with a culture that promotes growth and business sustainability, and 85% of organizations fail to transform their culture when leaders become too comfortable with the status quo.

Culture Changes and the Bell Curve

In his book, Know Your Why, Simon Sinek talks about the law of diffusion of innovation—an explanation of how people are inspired to change behavior, implement a new system, and embrace a cultural change. Different people in an organization have different thresholds for change.  Not everyone will accept change the same way at the same time and speed. This concept of cultural change is best explained through the bell curve that we are all familiar with from our statistics courses.

In any normal distribution of human behavior, the majority of the population falls under the curve, occupying 68% of the bell curve, and they are called the early majority and late majority.  The majority will only change behavior or consider an innovation after someone has tried it first. In other words, they will try something new if they have a role model and good reason for doing so.

Roughly 16% of the population are willing to try something new and accept change easily. Those are the innovators and early adaptors. The remaining 16% of the population are the laggards. The laggards will consider a change in behavior if they absolutely must. In Sinek’s words, these are the people who would still be using rotary phones if anyone still manufactured and sold them!

Through the bell curve, we learn that the majority of organizational leaders and staff members are resistant to cultural change. How many times have we been required to take mandatory trainings by HR that led us nowhere? And how much revenue was lost because of that? This is because the majority of staff members are too comfortable with the status quo and do not like disruption or new ways of thinking and acting.  To align our resources to adapt to change and a shift in culture, it is best to start training the early adaptors by making training optional.  When training is optional, the early adaptors will sign up and if they find the training effective and apply the lessons learned in their day-to-day work, they will share their experiences with the late majority.  In other words, mandatory training with required attendance seldom works in changing an organizational culture or employee behavior.

Of those open to change, there are the innovators and early adaptors. They are the “change agents” who question the status quo and value the company’s effectiveness rather than tradition and their own comfort zones. These early adaptors are the same ones who stand up for what they believe in and hold their leaders accountable. They see the need for change, are eager for change and need only be shown new ways of thinking and acting that are reasonable. Before adopting changes personally and permanently, they need good reasons and strong leadership with effective role models. And it comes as no surprise that it is usually the early adaptors who leave a toxic organizational culture when they feel their innovations and input are not incorporated or valued, leaving the company to the early majority who are comfortable with where the organization is currently headed. The same majority will only do what is asked of them and never question their leaders.

How to Address Change

Every organizational culture is different, and it is important to maintain the things that make your organization unique. The culture of a high-functioning organization consists of certain qualities that you should consider implementing:  

Alignment: As a leader of an organization, your task is to be the chief visionary officer for your organization.  You need to stay focused on your company’s mission and vision.  Once you identify the overall mission and vision of your organization, you can hire people who share the same values and then inspire them to contribute to the company’s vision. Within this process, always consider the power of diversity and inclusion when building your team.  Diversity prevents a homogenous workforce and promotes innovation and inclusion to ensure that all diverse perspectives are aligned with the company’s mission and vision.

Appreciation: Appreciating your staff can take any forms such as kudos, a note of thanks, or a promotion.

Trust: When team members feel that their supervisor will support them and will not be reprimanded when mistakes happen, they will not only bring their natural best to work but be more willing to innovate.

Inspiration: Employees need to feel they belong to a great culture. They want to wake up every day inspired and ready to be part of something bigger than themselves.

Psychological Safety: Psychological safety provides the support employees need to take risks and make changes. Psychological safety starts at the team level, so organizational leaders need to take the lead in creating a culture that is safe. When the team feels safe, they naturally collaborate, communicate and function at their best.

A culture where everyone matters:

If we want a culture where everyone matters and where true connections can occur, we need to ensure a culture of inclusion where differences are valued and welcomed. Diversity, Equity, and Inclusion (DEI) are more than metrics. DEI is about relationships and a mindset of constant learning, continual evaluation, and re-developing through diverse perspectives. Many institutions overlook the power of inclusive and diverse culture. Instead, they focus relentlessly on metrics, but metrics do not promote to psychological safety. As a social species, a positive culture can be deeply soothing. A positive culture creates a sense of belonging and harmony between those who work together. When we feel that we belong at work, we feel our contribution has value and meaning.

We need both cultural intelligence (CI) and emotional intelligence (EI) to cultivate a culture that is welcoming to diversity, equity, and inclusion where all employees matter. A staff member or a leader can possess a cultural quotient, which is an awareness of different cultures.  They are able to articulate that awareness in a way that enables them to work effectively with staff members from different cultural backgrounds and relate to the needs of all staff members. The cultural quotient is about the skills needed to successfully realize your organizational objectives in diverse cultural situations.

Cultural quotient and emotional intelligence go hand in hand. Cultural intelligence picks up where emotional intelligence leaves off. In other words, a person with emotional intelligence understands what underlies particular human behavior and the impact of a diverse upbringing on behavior—what makes each of us different from one another.  A leader with high cultural intelligence and a cultural quotient can pick up on the emotions and needs of others and has an appreciation of their cultural differences. Those leaders are more attuned to the beliefs, values, perspectives, attitudes, and body language of their co-workers from different cultural backgrounds. They use this knowledge to help them relate to their staff with empathy and understanding.

To increase the cultural quotient score of leadership in any organization is to increase their understanding of how different cultures impact the operations of the organization. It is about having a holistic look at your staff members. After all, the skill sets that employees bring to the organization are affected by their emotions and cultural upbringing. With this holistic understanding, leaders are better equipped to solve problems. A holistic look means looking at the interconnection between the body, mind, and soul.

Having an awareness of the impact of different cultures on human behavior is only one aspect to achieving cultural intelligence.  We also need to be aware of our body language and the message that gestures can send to a staff member. Your actions and demeanor must demonstrate that you have entered the conversation from their worldview. This could mean a proper handshake, bringing them water or coffee, sitting across from them in your team meeting, and mirroring some cultural customs or gestures to show that you appreciate them enough to be like them. By adopting these simple gestures, you show that you understand their culture. They, in turn, become more trusting of you as a leader.

Last, but not least, to adopt a new culture, you will need to overcome barriers. This is only possible when you believe in the deep human connection that goes beyond speaking their language.  It is believing in your own ability to make that connection. Confidence is key. If you do not believe yourself to be capable of understanding people from different cultures, you can easily give up when your first efforts fail.  You need to have the motivation, persistence, and attitude to overcome obstacles and re-engage with greater enthusiasm to reach people’s hearts. Remember what comes from the heart, goes to the heart because love always finds its way home.

A leader who is emotionally and culturally intelligent adds a competitive layer to an organization’s business by promoting cooperation, communication, and teamwork among their staff.