LEAN STRAIGHT TALK SERIES # 3
Culture change is a continuing challenge for most organizations. Executives talk about culture change as a top strategic imperative, yet the cultural nicety stuff always seems to fall down the list of immediate priorities. Additionally, jumping from one check-the-box program to the next has not changed culture. Millions of Kaizen, TPS, Lean, OpEx, KATA, and other continuous improvement (CI) consultants, trainers, and practitioners stress the importance of culture change, but their tools and methods-based practices have not brought about any sustainable difference. Sure, there has been some short-term process improvement progress in the applications of CI tools and methodologies, and there has also been a good share of backsliding to old habits.
However, one fact remains: A methodology and tools-based Lean initiative just doesn’t stick! Step back and take a hard look at your Lean and CI strategy. Passing the baton to different Lean leaders while staying on the same track doesn’t change culture. Calling your Lean initiative a business system in name only doesn’t change anything. Token responses (vs. passionate, unwavering commitment) and comments like “Good job, keep it going” doesn’t yield sustainable results. Following more advice of more social media posts on specific tools and techniques has gotten very boring and old. These actions do not result in sustainable improvement and do not change culture. Culture is not the soft stuff, it’s the hardest stuff. Period, end of story!
Culture Is the Hard Stuff
Most organizations have missed the mark on transforming culture as the critical foundation to any strategic improvement or transformation initiative. Culture is key to sustainable Lean and CI success because it involves deep, continuous behavioral alignment learning and human development. A fanatical focus on the methodologies and tools is analytical learning, which is much easier but not sustainable without a winning cultural foundation. Decades of Lean and CI programs with their respective birth-death cycles have moved the needle of culture change in many different confusing directions. Too many organizations are so blindly committed to their current initiatives, and are not able (on their own) to put the keys down and rethink their journeys.
Again, nothing is sticking! So many organizations have been through many cycles of high expectations and followed by disappointments, thus reducing their associates’ appetites for another change initiative. Organizations continue to struggle with their Lean and CI initiatives because their cultural foundation is a slippery slide of Lean and CI jargonese, confusing priorities, and lack of a well-structured talent and cultural development process.
Organizations must recognize and accept transforming culture is a living, structured, deliberate, consistent, and continuous process of cultural development. Cultural development occurs from the top down. Cultural transformation is a living response to (good and bad) leadership behaviors, choices and actions and occurs from the bottom up. Culture changes by choice, not by chance. This post provides new insights about how to treat cultural transformation as a living process and achieve superior and sustainable performance with your Lean and other strategic and operational improvement initiatives.
You Can’t Change Culture Until You Understand Culture
Culture change is one of those leadership topics that everyone knows about except in daily practice. Everyone is intellectually committed to developing superior performing organizations, but the tactical process of improvement is always easier than the human dynamics of sustaining the gains. Let’s review some of the basic essentials of culture.
What Is Culture?
One can find many different explanations of culture. From an applied experience perspective, culture is the combined set of values, code of conduct, beliefs, traditions, habits, interpretations, behaviors, choices, actions, taboos, rituals, accepted norms, inhibitions, aspirations, functional subcultures, and the multidimensional interpretations of any of the above at any point in time. Culture is a living process, changing deliberately or unintentionally, in good directions and in bad directions – based on the living dynamics of the above factors. Yes, culture change is a very complex topic. This is our explanation based on real world experiences, and I certainly welcome other inputs in the comments section of this post.
Who Determines Culture?
Executive leadership establishes the organization’s cultural environment by their own behaviors, choices, and actions – And how they influence the cultural attributes in their organizations on a personal level. Executives are always on center stage, acting out their behaviors, choices, and actions while individuals, departments, or informal groups in the organization observe and draw their own interpretations and perceived expectations. Executives, managers, supervisors, and anyone in a position of directing others change culture because it is a cascading phenomenon. Culture is also highly influenced by the natural interactions of people working together. Rumors, misguided interpretations, personal and cross-purpose behaviors, and poor communication really influence culture in a negative way.
So – as an executive, understanding culture is not enough. You have to be committed in your soul to develop a superior talent base by positively influencing the right, success-enabling attributes of culture mentioned earlier. You also need to create the multiplier effect where your organization lives and breathes culture change every day via a consistent, unified message. What does this mean? You need the best talented, high performing people to help in the multiplier and cascading process. Everyone can lead and contribute to culture change. This is a large responsibility . . . Larger than many executives and executive teams are capable of, and have been able to influence and sustain.
When Does Culture Change?
Culture is dynamic and exists either by deliberate design or inadvertent default. In other words, culture is always changing – for better or for worse. Culture changes through deliberate design and continuous nurturing. Culture also changes by poor leadership. Lack of constancy of purpose, wavering commitment, mixed signals about direction, tolerating poor performance, organizational politics, conflicting performance metrics, allowing a few people to undermine the efforts of others, poor communication, and many other dynamics create waves and shifting tides in culture. Stronger willed and difficult people also have a large influence on culture. Culture is always changing because it is a living response to leadership and human dynamics in organizations.
Fact: Culture evolves to a higher order, remains the same, or becomes undermined by negative activities as perceived by the organization. There is a strong correlation between operating performance and how culture moves around in organizations, whether in isolated pockets or ingrained in the organization’s larger business system.
Why Is Culture So Important And Difficult?
Culture is the combined make up the sociological and psychological fabric of organizations. Culture is what drives the organization’s entire talent pool in the right strategic direction to achieve the right desired results. Culture is the difference between great organizations and mediocre organizations. If a company has a mediocre organization these days, it doesn’t really have an organization at all. These organizations risk the downward spiral of excessive costs, diminishing profits, and lack of the right skills and competencies to turn things around.
Nothing changes in organizations until people believe, are ready, willing, prepared for, and committed to change. Great executives consciously nurture a long term, strong emotional connection to change throughout their organizations. Everything else is temporary, where people give the nods but drift back to old norms as soon as the attention is turned to other more pressing issues like daily firefighting heroics and reactionary management. Executives cannot mandate culture change or hang up banners, slogans, and posters and expect culture to change on its own. Polished stumping followed by the observed exact opposite behaviors, choices, and actions does nothing but destroy credibility and increase resistance to change.
In my own experiences, inconsistent, reactionary behaviors and conflicting performance measurement and reward systems are the largest disruptor of culture. When an organization is resistant to change, 95% of the problem is leadership. And how does the human nature of leadership typically work? By shifting the blame to their organizations in the form of “I don’t know why these people are so difficult to change.” Decades of experience have taught me that change is the only constant, and it’s usually not welcome. All real leaders must always approach change with this in mind.
Where Culture Needs To Go
First of all, there is no right or wrong answer for culture change. The other fact about culture change is that the progress of a hundred good deeds can be erased by just a few bad deeds.
Today’s leading organizations are in a different pendulum swing to a higher order of cultural excellence. Organizations are paying more attention to human capital development, engaging and empowering associates, building self-managing organizations, and transforming culture. Markets are moving away from a discrete product focus to a highly efficient, integrated solution delivery focus. Emerging technology is a major driver of this change as more and more organizations are shifting towards an Amazon or Home Depot eCommerce operating model. Technology by itself does not make these transformations successful. Transformation requires the successful integration of strategy and alignment, people, process, technology, equipment, and performance measurement, where execution and sustainability are highly human and culturally dependent.
Need help with executing successful change management to improve your lean transformation process? We do this for a living.
The Center for Excellence in Operations, Inc. (CEO) is engaged with many different clients every day, within a variety of industries, operating environments, and with different Lean/CI and cultural renewal challenges. We can get your Lean/CI initiatives back on track and operating at a much higher order, daily business system model level.
Contact one of the authors below. We will be happy to discuss your current situation and needs.
Terence T. Burton is President and Founder of The Center for Excellence in Operations, Inc. (CEO), a management consulting firm specializing in strategic and operational transformation. Terry has four decades of extensive operations and supply chain experience as a hands-on practitioner and executive in private industry, and has led consulting engagements in a wide spectrum of industries, having consulted with over 350 clients in 23 countries on their strategic and operations improvement initiatives. Terry can be reached directly at firstname.lastname@example.org
Edward A. Fagundes is the West Coast Practice Director for The Center for Excellence in Operations, Inc. (CEO), with emphasis on serving clients in the West Coast, United States region. Ed’s career spans various leadership roles in general management and as a global business system executive. He has proven expertise and extensive experience with improving business processes, developing lean transformation strategies and plans, leading the implementation of business improvement journeys to address business issues, and implementing enterprise-wide continuous improvement applications. Ed can be reached directly at email@example.com.