Shaping Corporate Culture 

By Thomas Doyle 

Corporate culture is a lot like the weather. Everybody talks about it, but few ever do anything about it. 

“Your company has a critical aspect that can help it succeed extraordinarily or fail miserably,” said Ravi Kathuria, president and founder of the Houston Strategy Forum. “That aspect is corporate culture.” 

Without the right culture, a business can’t move at the right speed to succeed even with the best strategy, Kathuria said. Despite being critical to success, corporate culture is seldom considered in strategic planning. Worse, it’s often treated as an afterthought and relegated to the human resources department instead of being kept in the executive suite where it belongs. 

To help the executives gathered for the Houston Strategy Forum’s August luncheon think a bit more about corporate culture, Kathuria invited John Sheptor, president and CEO of Imperial Sugar Co., to discuss how corporate culture can be aligned with strategy to help a business succeed. 

“If the culture doesn’t fit the strategy, the whole organization breaks down,” Sheptor said. 

Kathuria and Sheptor began the discussion by defining corporate culture. 

“Culture is the cumulative of how everyone believes, everyone works together, and how they all think,” Kathuria said. 

Culture is defined by how employees work together, work independently, and how they work with the business requirements, Sheptor added. 

The great irony of corporate culture is that while management can guide it, corporate culture ultimately will be created by employees when they settle on a status quo, Sheptor said. Their behavior will either align or conflict with the strategy. 

“Culture determines what gets resourced when management isn’t around,” Sheptor said. What people work on in their free time is the status quo that makes up corporate culture. For an organization to be successful, it must have the right status quo. 

Without the right culture, people will work on the wrong things, Kathuria said. 

Cultural changes should only come as part of a strategic change, such as those required by new technology, new competitors or new rules governing the marketplace. 

“Culture is not a conversation we have outside of strategy,” Sheptor said. Strategy includes the organizational culture needed to execute it. 

The process of changing culture begins by assessing what types of behaviors, experiences and talents will be needed in that new culture, he said.  Then they must survey the organization to see which of those are presently contained within the organization. This survey will reveal the gaps in the organization that must be filled to adopt the new culture.  

Executives need to recruit in a targeted way to fill those gaps in behaviors, experiences and talents. They should seek out workers experienced in the culture they are trying to create who will become the advocates for that type of culture within the organization. 

These new individuals will be the leaders to whom workers will turn for answers. Workers will look to these new employees to determine why they should go where these people have been in terms of culture. 

Change continues by putting procedures in place that require employees to adopt the behavior or practice leaders want to establish as the new culture. Those who adopt the changes should be rewarded. Those who champion the new changes should be recognized and rewarded. 

Shaping culture often means shaping the opinions of leaders in the group. These leaders often don’t carry official titles, Sheptor said. The people who other employees listen to will often shape the attitudes others will take toward the culture change. 

In the beginning, these changes require a high percentage of time involvement of leadership. 

Cultural change also requires the design of metrics that measure how well employees are adopting the new system. Change cannot be managed if it cannot be measured. 

“Inevitably, when you change culture there are some people who have to go,” Sheptor said. A wise manager creates a dignified, honorable way for these individuals to leave. The individuals are not wrong people, they are just better suited for a different culture than the one that will be required for the organization to succeed in the future.  

Just because someone complains about the change doesn’t mean they are the wrong person for the new culture, Sheptor said. 

“A complaint is disguised request,” Sheptor said. When a complaint comes, leaders should find the underlying request and see if it is something that can be addressed in the new strategy. When taken this way, complaints provide valuable feedback from frontline employees working in the trenches and can point out strategic holes that managers may have missed from their view from the top of the organization. 

Leaders often avoid dealing with corporate culture because it is very difficult to change culture for a number of reasons, Kathuria said. One of the biggest reasons is that managers themselves must evolve with the changing culture.  

“The number one reason for failures to change culture is that leaders behave contrary to the new culture,” Sheptor said. 

Managers must lead by example from the front lines, Kathuria said. Failure to do so will spur resistance. Leaders also must be prepared to dedicate large amounts of their time to the change in the beginning. This includes coaching and directing managers and employees into the new culture. 

“People seek security in change,” Sheptor said. “You’d better be there as a leader to help the organization feel comfortable about the change.” 

The hardest part of cultural change is that it takes time and patience, he said. It can take three to five years to effectively change the culture of an organization. 

During change, leaders start by coaching and guiding, and move into directing. Eventually, the culture will accept the new status quo and carry on under its own inertia. 

Cultural change involves getting the right people, putting in place the policies and procedures that will require the behaviors of the new culture, and then recognizing and rewarding those who adopt and champion the new culture. 

This takes corporate culture out of the realm of feelings and values often and into the realm of strategic execution, Sheptor said. 

How well an organization implements cultural change often determines the extraordinary success or miserable failure of the business, Kathuria concluded. 

Thomas Doyle is the head of strategy and public relations for Agama Advertising