Top 4 Reasons Culture Change Initiative Fails
When I started the corporate culture shaping 40 years ago, the word “corporate culture” was no longer discussed.
After graduating from UCLA, I started a process improvement consulting firm and I soon realized that it was easy to decide on change to change people. I also noticed that in some companies, the change was very easy to implement and in others it was like pulling teeth. I started to see that similar to individuals, companies had personalities, and some were healthy, like most of the failed families – and like failed families, they had resistance to turf issues, belief issues and change.
While working with Woolworths on the supply chain in Walmart, there was great insight for me while working with Sam Walton. Although they had very similar financial and managerial resources, it was clear that a company would be successful and fail due to the mentality and habits of other firms.
This led me to professors at the University of Southern California, who published a book with articles describing an incident called organizational character. Since I had a customer, he assured me to join the doctorate program and research the incident. My dissertation, published in 1969, perhaps became the first regional study of corporate culture at the organizational level.
Finding a Central Culture
Central search, which is true today, is that the organization becomes “the shadow of its leaders”. We knew that the culture change was to start on top. If the senior team has not cooperated for the better, then the organization will have a turf and silos. If they were very hierarchically and controlled, you would find that culture from top to bottom. We found that we could diagnose the culture, but we had to face the challenge: how do you change the habits of adults, especially the successful senior leaders?
Cold and unfriending habits
This led to the second success. I had an event of big life that made some epiphany and how I changed the world. I changed some of my behavior
My research in altering through ah moments highlighted the work of early social scientists Kurt Levin. He said that one thing helped to make Sun Delaney as a culture-shaped firm and enabled us to deal with new, more powerful ways.
They said, “When we are young, we are like a river flowing – and then we become stable.” His theory was that we are frozen in habits, and we are stuck when there is some kind of irreversible. Levin was a believer not only in the need of the leader but also the team, the organization and the whole system. As a result, we started experimenting with insights based learning modules for CEO teams around the behavior of a healthy, high performing leader, team and organization. We asked them to set the necessary price.
Until then, almost all behavioral changes in the business were based on the behavioral model defined by American psychologist and behaviorist BF Skinner. Define what you want and strengthen it. This is a good model that we have employed to strengthen the change after epiphanies, but is not powerful enough for embedded habits.
Interest in culture size img
There was not much interest in the size of the culture when we formally launched the firm in 1978. Our first customers were retailers who wanted near Nordstrom or Walmart. Nordstrom was the best in customer service, and in those days Sam Walton was a very efficient organization with the patrons and happy boxes. Retailers found that the customer’s experience was a cultural thing, but thought it was a store issue. We got stuck on our guns, and when asked to make service culture, we would say, “Only if we can start with the CEO team because the stores are children of the entire organization.”
Major changes essentially emerge in order to keep healthy culture. Mai Bell’s division and breakup in the phone industry led to shaping the culture. Bell Atlantic and later Verizon CEO Ray Smith said, “If I put my ears on the track then I can hear the train, and we are not ready – we have to change or die.” Over time, there has been a change in more industries and thus we face what we call “jaws of culture”.
The tipping point
Organizational culture has reached a tipping point. Most CEOs know that there can be a strong impact on the case of culture and business outcomes. Studies now confirm that it is considered as important as success in success, and in fact, it should be a strategy. That is the good news.
The bad news is that despite many of this comprehensive executive understanding of culture, and many studies and books written for decades to show the relationship between culture and performance, the fact is that many culture change attempts have still failed.