Warrick 2017 - What leaders need to know about organizational culture

Page 1: Copyright Notice

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Page 2: Importance of Organizational Culture

• Culture Matters: Organizational culture influences performance and employee behavior.

• Links between culture, organizational performance, and employee attitudes are being studied.

• Fortune’s 100 Best Companies report emphasizes workplace culture.

• CEO Insights: Tony Hsieh of Zappos states a strong culture leads to great service and strong branding.

Key Insight

• Skilled leaders are recognizing the importance of culture in their organizations.

  • Lack of awareness or understanding may hinder effective culture development.

• Abstract: Culture is crucial for success, influencing morale, productivity, and talent retention.

• Leaders must align organizational strategies with cultural ideals for effectiveness.

Page 3: Leadership and Culture

• Lou Gerstner, IBM: Culture is fundamental to organizational success.

• John Stumpf, Wells Fargo: Culture is critical; strategic plans can be undermined if cultural values are overlooked.

Understanding Organizational Culture

• Defined as predominant beliefs, values, attitudes, behaviors, and practices of a group.

• Cultures vary widely within organizations, affecting work environments positively or negatively.

The Impact of Culture on Performance

• Studies show that healthy cultures significantly enhance organizational performance metrics.

• Kotter and Heskett’s study showed healthier cultures resulted in higher sales and stock increases.

• Effective leadership correlates with the creation of strong cultures.

Page 4: Culture Dynamics

• Cause vs. Effect: Culture can be both a cause and result of organizational practices.

• Leader actions and decisions heavily influence both organizational performance and culture.

Insights for Leaders

• Distinguish between dominant cultures and subcultures within organizations.

• Visible vs. Invisible Factors: Culture represented through observable and intuitive characteristics.

• Traditions and Group Dynamics: Understanding historical context influences culture positively.

Internal and External Influences

• Internal: Structures, processes, leadership changes, etc.

• External: Economic factors, regulations, reputation issues.

• Recognizing valued and devalued behaviors is crucial to shaping culture.

Page 5: Leadership Influence

• Strong leadership can cultivate positive cultures or detract from existing ones, depending on leadership effectiveness.

• Cultures: Strong cultures have clear norms, while weak cultures lack consistency.

Characteristics of Performance Cultures

• High-performance cultures have skilled leaders who foster trust and commitment.

• Positive behaviors, collaboration, and continual improvement are hallmarks of high-performance cultures.

Page 6: Culture Vulnerability

• Culture can be a fragile asset and can deteriorate without proper leadership oversight.

• Wells Fargo Case: Culture deteriorated under an overemphasis on sales, resulting in unethical practices.

Emphasizing Success and Challenges

• Success can foster pride and unity, but leaders must be cautious of complacency.

• Challenges provide opportunities for bonding and reinforcing cultural values.

Page 7: Building Sustainable Culture

• Culture can be built by design or allowed to develop by default.

• Leadership Role: Leaders should prioritize culture and strategy alignment.

  • Building cultures requires purposeful actions and awareness of cultural values.

Guidelines for Building Culture

• Make culture an organizational priority.

• Assess present culture to identify gaps and strengths.

• Engage employees in cultural initiatives to bolster buy-in.

Page 8: Strategic Alignment

• Ensure alignment between strategy and culture to facilitate desired cultural outcomes.

Role Modeling

• Leaders must exemplify desired behaviors to guide organizational culture.

Recruitment and Development

• Recruiting for cultural fit is essential; it should be a priority at all organizational levels.

Page 9: Reinforcing Cultural Values

• Recognize and reward behaviors that reflect cultural ideals.

• Use symbols and stories to communicate and strengthen cultural identity.

Appointing a Culture Team

• A cross-functional team can monitor culture and ensure alignment at all levels.

Page 10: Ongoing Management of Culture

• Regular assessments of culture can help identify negative shifts.

Page 11: Summary and Conclusion

• Key Insights: Understanding culture's impact on organization performance is critical.

• Leaders must be trained to manage and cultivate strong cultures intentionally.

References

• References the studies and opinions that contribute to the discourse on organizational culture and leadership.