The Impact Of Culture On Your Organisation’s Results

It is that time of the year – you just received news that the company fell short of its annual targets and the profits are not as healthy as expected.

It is more of a pain than a surprise to you. You feel stressed that your boss is stressed as his boss is stressed.

Your boss’s boss says it’s the people while your boss believes it is the strategy and bad execution. You are just confused. In the end, all three blamed it on the economy. But what is the real reason for our failure to hit results and achieve goals?

According to Joseph Tan, chief executive officer (CEO) of Leaderonomics Good Monday (LGM), the issue is culture. Companies that fail to intentionally create, design and deploy culture, fail to achieve their desired results.

Tan’s statement is based on research by the Leaderonomics Research division, where findings indicated that various cultural elements, namely belief and mindset of employees, have a direct correlation with actions and results.

What is culture?

In 2014, the Merriam-Webster dictionary announced “culture” as the word of the year. In 2015 and 2016, we witnessed a powerful shift of focus from business strategy to organisational culture with the latter heavily endorsed by the likes of giants such as Google, Apple and Facebook.

Interestingly, in digging deeper through the list of LinkedIn’s “Top Attractors Where The World Wants To Work Now”, culture and engagement were key indicators for organisations that made it to the list.

This might interest you: Do You Know What Culture Is Really About?
Unfortunately, culture remains, at best, grey and, at worst, completely overlooked as companies remain oblivious to its power to transform. Consider this piece of research:

In 2013, research from Gallup indicated an increase in performance-related business outcomes by 240% when an organisation deepened its culture and engagement efforts.

But for us to truly understand what drives cultural transformation in a business, we need to understand what culture is not.

Investing in better cubicles, free snacks, gym memberships and having cool offices does not translate to a culture transformation. These are all fine and dandy but there is actually a science to cultural transformation.

According to Roshan Thiran, CEO of Leaderonomics, “culture starts with a clear purpose”.

Organisations that are purposeful and have clarity of purpose and vision have a higher possibility of building an effective culture that enables them to achieve the vision that has been set out.

Being a millennial, I care about being associated with a purposeful vision. Culture starts with your narrative of the WHY of the company – its values, belief systems, ambitions, personalities and rituals. It is this narrative that translates to a worldview of what the company stands for.

After all, what we know of AirAsia’s culture today is simply shared stories of our experiences, from the moment we stood at the check-in counter right until we arrived at our destination.

From the outside looking in, the rest of the world may not understand the business model nor the strategies of AirAsia but what they can relate very strongly to is the culture practised by its employees on the ground and up in the air. Our decision to continue using the carrier is most likely influenced by these very experiences that we have gone through.

From belief to action

So, the first step in designing an effective culture is to have clarity of purpose. Secondly, Roshan adds that “culture is defined by behaviours.”

Our behaviours are a result of beliefs and the mind-sets that we have. If you believe that your boss will yell at you if you speak up at meetings, your belief will translate to an action – in this case, you will not speak up in meetings.

These beliefs are reinforced through experiences. When we experience something repeatedly or continuously, we formulate beliefs that lead to action and ultimately, to results.

So, if we want to change behaviours, we must change the experiences our employees are going through. When we successfully change these experiences through creation of new rituals, we have begun the process of culture transformation.

Many organisational culture changes begin with covering the office walls with banners broadcasting the new culture.

Some try to engage their workforce through fancy team-building sessions. You can huddle through meetings after meetings with your leadership team, preparing action roadmaps.

And then you can organise a town hall meeting to cascade these plans, believing that the faster they are disseminated, the better.

Unfortunately, these efforts seldom get to the hearts and minds of the people – the very core of what makes them want to change habits and experiences that they are already comfortable with.

Here at LGM, we believe in starting small. In our experience, some great examples of successful corporate culture turnarounds have been those who have captured the hearts and minds of their people through the formulation of new rituals and experiences. But it must start with clarity of purpose and desired results.

One of the key things that we do with organisations is to engage with leaders to identify a number of key “limiting” patterns of beliefs that shape these behaviours.

Once we successfully identify the fundamental limiting beliefs that people have of their company, we deep dive towards converting these beliefs into winning outcomes that create positive experiences and achieve the business results.

Our observations of successful transformation are that it happens when leaders are willing to accept the current undesirable reality, roll up their sleeves and work through the muddle. For leaders, the key to victory is to listen attentively, speak for clarity and act in unity.

A final element of cultural transformation often overlooked is empowering your managers to become great managers. Change can be bottlenecked at the middle manager level if effort to educate and develop these managers into effective leaders does not take place.

Relationship matters

Although change happens from the top, nothing is more uninspiring than knowing that your manager does not care to hold a better relationship with you. After all, Gallup knows this best as their analysis points to “relationships with direct supervisor” as the number one reason why employees leave the company.

A great manager helps you grow your strengths while teaching you to manage your weaknesses.

In an environment that is heavily undergoing culture change, it is important for people managers to step in and keep the workforce engaged and excited to see the big picture.

Recommended reading: The Leaderonomics Show With Tom Hopkins: Focus On Relationships, Not Profits
At LGM, we have developed an approach that enables culture transformation to happen in a simple and effective way. Our two-pronged approach of intertwining culture transformation and employee engagement is a potent formula that drives profits but also enables employees to feel purposeful, creating a unique culture that can be a competitive edge for you.

Ashvaani Ramanathan is a senior consultant with Leaderonomics Good Monday. She gets inspired each time her LGM team is able to successfully transform organisations “culturally”. Although culture transformation may seem like rocket science, she believes that every organisation should invest deeply in it if they desire to become globally competitive. To explore a free consultation session with LGM, e-mail joseph.tan@leaderonomics.com or info@leaderonomics.com