Revamping values for the next transformation
“Hi sir, could you please help us to give life to our values again? We had such a great set that worked initially but the values have lost their energy. We need to revamp them now because we are getting into another transformation process and honestly, we don’t know what to do that inspires our people another time”.
Do you recognize this set of questions?
About five years ago, the introduction and implementation of values into behaviors was at its peak. Nowadays, it has lost a little of its popularity. That does not mean that the top of corporate houses are not convinced that the creation of a high performing and thus, a value-based culture is essential to the achievement of their goals. Neither is there a lack of awareness that values are just stale expressions if they are not translated into actual behaviors. However, the problem is that people are not aware that some of the values and behaviors need continuous reminders to be implemented. Next to that, due to the drastic changes in organizational challenges, the organizational business environment also demands strong changes in the behaviors. How can organizations deal with this meta-dilemma of ‘Endurance’ and ‘Change’?
Culture change that sticks
Match Strategy with Culture
We need to see culture as supportive to reconciling business dilemmas; rather, we see cultural change as a side dish. Culture has always been seen as functional to solving the problems and dilemmas of mankind. The Dutch needed consensus because it helped them fight for water effectively and the Americans seem to be so legalistic because they are highly mobile and don’t have the circumstances to build a relationship where they can trust. And why do the Japanese love Micro and Nanotechnology? Obviously, because there is little space.
Culture is the way we solve problems and reconcile dilemmas. It starts with certain behaviors that seem to work. When they work we call it a value and when the value helps in surviving, it becomes a norm. When the value becomes a norm, we develop beliefs. We, therefore, conclude that the value of a value is the degree to which it helps groups of people to reconcile dilemmas.
This means that in our consulting work, we start by capturing the main business dilemmas through triangulation, which is a combination of interviews, linguistic analysis, and questionnaires in all forms and shapes.* For example, we have developed an App that captures the dilemmas between two companies engaged in a Merger or Acquisition1; one that captures the dilemmas of Innovation2; a high performing team app which measures the dilemmas that a team experiences in areas of leadership, communication, and decision-making3; and finally an app that measures the dilemmas between current and desired corporate culture4. The outcomes are validated by interviews and desk research (linguistic analysis) with a series of key strategic dilemmas as an outcome.
From there we engage the key players (often the top of the house) in a Dilemma Reconciliation Workshop (DRP). A dilemma can be defined as two propositions that are in apparent tension. A dilemma describes a situation where one has to choose between two good or desirable options. For example, while on the one hand, we need to centralize (global); on the other hand, we also need to decentralize (local).
Most organizational issues, business and leadership challenges can be framed as a tension between two or more (desirable) value propositions in apparent conflict.
We define these competing demands as dilemmas. Organizations in any culture need to deal with the competing demands of different stakeholders (including clients/customers, shareholders, employees, business processes, and the external environment more generally). The relative priority given to these dilemmas, how they are initially manifested and the approaches to resolving them are culturally determined.
Dilemma Reconciliation is a way of thinking that moves beyond either-or thinking, and even and-and thinking.
By using through-through thinking, the aim is to synthesize seemingly opposing viewpoints, and give value/respect/appreciation to different sides of a value proposition. This unique methodology teaches people and organizations to address competing demands and by bringing together competing for demands, objectives, and values, innovative solutions are discovered. The 7-step dilemma reconciliation process ends with step 6: action and monitoring progress; and step 7: “What are the values and behaviors we need to develop in order to support the dilemma to be reconciled?” In this way, we make it very apparent that values are there to be matched with the strategic dilemmas.
Focus on few critical shifts in behavior
“We have excellent values on all our posters and our staff seems to like them, but how can we make them effective at work?” The implementation of values in actual behavior seems to be a big challenge. Another challenge is what behaviors to prioritize. The success of an organization is dependent on its ability to build a culture that supports the organization’s goals, and building such a culture requires answering the following three questions:
- What binds and connects people and energizes them into inspiring and winning performance: What do we stand and go for?
This area is about establishing the values, translating these values, and making them work in the day-to-day business context (concrete behavior, business results, communication etc.). For this purpose, we have designed the V2B workshops to build on the inherent energy that comes from values that are genuinely shared within the organization, however, these values need to be interpreted or ‘translated’ for them to become relevant in people’s daily work. The V2B process builds on the powerful, centuries-old adage “Don’t do upon others what you don’t want to be done upon yourself”. Participants in a V2B workshop explore in depth the behaviors they mutually expect from each other in intact teams. Leading from this, they then jointly create an Internal Charter-of-Behavior capturing a limited number of observable desirable and undesirable behaviors for further embedding and ‘living’.
- What separates people and keeps them divided? What are the issues and dilemmas that confront people?
This relates to the identification and reconciliation of business dilemmas and the implementation of win-win solutions. We use values and dilemmas as the basis for strategic decision-making. Values should be defined according to their position within a dimension of seemingly opposing value orientations such as e.g. consistency and flexibility. Honoring each of these opposites is equally important for successful business performance and requires their integration into a reconciled strategy.
- How should the leadership act to benefit and build on what binds, deal with what divides, and create leadership throughout the organization?
In this area, we focus on developing the competencies of a leader to Recognize, Respect, Reconcile, and Realize (4R’s). In particular, reconciling dilemmas is what distinguishes leaders as they require the capability to deal with dilemmas more than others. Now, more than ever, a leader’s capacity to both direct the organization and its people, while at the same time work in their service, is being recognized as vital for creating a sustainable organization. We challenge leaders to reflect on their own leadership styles and behaviors, to identify areas for growth and to practice new behaviors/techniques to bring out the best in their employees and organizations. Leaders will enhance their competence to define and frame the major business issues and learn how to address and resolve the tensions between seemingly opposing values in a measurable and creative way. The focus on one or two behaviors at a time works most effectively.
Honor the strengths of your existing culture
“We have tried to set our values and even implement them, but they often seem to lead to pathologies hurting the organization”. This is another quote we often hear.
Let us start with a statement: Any value disconnected from its opposite leads to pathology.
We have seen that organizations develop preferences like individuals do as many psychological indicators do elicit. Successful organizations, however, do combine opposites. So if we take our seven meta-opposites, they encompass possibly seven dualities that are reconciled as the following: “We standardize our best customization” (Universalism vs. Particularism); “We strive for teams that consists of creative individuals” (INCO); “We are passionately controlling our emotions” (Neutral vs. Affective); “We give people direct feedback with diplomacy” (Specific vs. Diffuse); “We act as servant leaders” (Achievement vs. Ascription); “We speed up sequences by synchrony” (Sequential vs. Synchronic); and “We push our technology through the pull of the Market” (Internal vs. External Control). How can we embed these dual or yin and yang values in the desired behaviors and behavioral competencies that need to be established within the organization for which the responsibility lies with the leaders of the organization?
One of the biggest financial institutions in Canada just recently introduced three dualities of values. This was a reaction on their overarching belief in Ambition, Innovation, and Collaboration and led to a very harsh environment in the beginning of the financial crisis. They were so innovatively ambitious that no collaboration could save them out of the swamps. The values have become pathologies because they were not counterbalanced by their opposites. Now they are trying to help their leaders to integrate the specific with the diffuse by Ambition and Prudence, Innovation and Rigor and finally Accountability and Collaboration.
Leaders are now asking how prudence can help them to frame their ambitions. How can rigor help with innovation? And how leaders can be held accountable for being collaborative?
This financial institution has chosen to adapt their Charter of Behavior and ask questions such as: How can I see you become more innovative by using rigor, or how has prudence helped you to get more ambitious?
This is very much in line with the dual values of PepsiCo International and Applied Materials: “We strive for teams that consist of creative individuals and we give people direct feedback with diplomacy.”
Jeff Bezos of Amazon has had to grasp the dilemma of selling to a special group with whom deep relationships were developed in the areas of music and books or, to a broad array becoming the largest retailer in the world. His newly developed Internet Selling Model has the advantage of being simultaneously very broad and at the same time deep, personal and customized, creating communities of people giving feedback on the products. Amazon’s values and behaviors reflect that. Isn’t it interesting that Amazon is opening analogue stores and that Google is opening pickup stores when they are so digital? Also, what good examples do we find in sports environments? A coach like Louis van Gaal can sharply analyze the situation into the deepest and most specific details and combine those into the larger whole by inviting partners of players to celebrate the last win. It is the total personality that needs to be involved to make analyses worthwhile.
After an analysis of the current and desired organizational culture, we often find dilemmas in values too. Generally speaking, collaboration should not reduce accountability. What was missing from the existing equation is the potential power of teams. A team should not be confused with a committee. Committees delegate. Teams make promises to fellow members that each person will take particular actions and at the next team meeting,[ each must show those promises were kept. Everyone is responsible to each other, to the team, to the joint project, to the customer and to the organization. The advantage of teams is that they become jointly accountable for the success of their project. The very existence of this duality suggests that teams are not being deployed strategically to good effect. Collaboration in teams should strengthen not weaken accountability. Unlike committees, teams are temporary, lasting only as long as the project lasts. This entails being accountable for the success of collaboration. We illustrate what can go right or wrong in this. To have the team hold members accountable can misfire if they gang up on him or her and say “It’s all your fault! We were just helping you.” Similarly, collaborating can sometimes lead to “everyone” being at fault and hence, no one in particular and so all excuse each other and agree to hide what actually happened. You can get collaboration without accountability and accountability without collaboration.
However, at the top right of the diagram you achieve the integrity of both values. Here, each team member is responsible to all the others for her/his contribution to the joint project; and where there is a mess-up, it is not difficult to locate its source. One or more person(s) did not keep their promises and are accountable to them, to the project, to the organization, to customers and to superiors.
Furthermore, their value of entrepreneurship seemed to hinder them to get the discipline to make things last. The hard thing is to put the foundations under them. We interviewed the top and these are some quotes: “If you innovate you are going to make mistakes. Do you have the discipline to clean up?” “We are more innovative than we believe. I think there is a slight overkill with rigor.” “I think we are actually more innovative when certain disciplines and principles endure.”
Collaborating can sometimes lead to “everyone” being at fault and hence, no one in particular, so all excuse each other and agree to hide what actually happened. You can get collaboration without accountability and accountability without collaboration
It is clear that our respondents saw these dualities as reconcilable. If being innovative dissolves the status quo, someone must re-institute the new order. As the demonstrations of non-violent Civil Rights marchers attest, you need an iron discipline not to lose control. You can disobey a law only if a new law can be made from the manner of your disobedience. Scientific innovation obeys laws of science or discovers new laws and rigorously obeys these. The most eloquent speech or original prose still obeys the rules of grammar and would not be understood if it failed to do so. The most brilliantly inventive enterprise still needs to meet all its legal obligations, pay those who helped it, and fulfill its contracts.
In order to be fair to both values current and ideal, we actually need two solutions, one that puts innovation ahead of discipline and another that puts discipline ahead of innovation. The English language insists on subject-verb-object and we must obey this. Hence, we could say:
“Innovative concepts being new require rigorous testing to prove their worth.” Or we could say, “Only by the rigorous mastery of your discipline can you innovate through it.”
Note the epithets at top left and bottom right. When rigor is taken too far, you get the restraint of innovation and an irrelevant discipline imposed. When innovation is taken too far, discipline is subverted and innovation lauded regardless (neophilia). The two values must be reconciled at top right in each case. We achieve innovation through discipline and find new rigor through innovation. The example above shows the importance of respecting the current culture but in the transformation process, it needs to enrich itself by connecting it to apparent opposite values: dualities are an expression of those.
Integrate formal and informal interventions through leadership
In any culture change process, it is crucial that the top of the house leaders practice what they preach and walk the talk. The essence of leadership is to distinguish a problem from a dilemma by asking the question “Can we solve it by more money or time?” If the answer is a ‘yes’, it is a problem, and if the answer is a ‘no’, you might have a dilemma in house. The essence of leadership is to be a reconciler in chief. You listen well to get the opposites on the table and when they both make sense, you ask the question: “How can orientation A help me to get more of orientation B?” So Steve Jobs asked: “How can I make aesthetics functional and how can I make hi-tech beautiful?” The rest is history.
Effective leaders make sure that hard and soft processes are combined — the hard stuff is often embedded in processes but the HR-stuff is the framework within which soft processes can nurture and thrive
Effective leaders also make sure that hard and soft processes are combined. The hard stuff is often embedded in processes but the HR-stuff is the framework within which soft processes can nurture and thrive. The best combination to elicit this power is the What-How matrix introduced by Jack Welch at GE. Staff is measured regularly on their effectiveness on reaching the agreed upon tasks (what) and if they live the GE values (how). Welsh said the easy category were those who did or did not do both ends of the spectrum: they got a bonus or were fired. Difficult are the combined ones. The staff that lived the values but didn’t achieve the tasks got an offer of support. The staff that got the task done but against the values got a warning. That’s how you combine hard and soft processes!
Since we strongly believe in the value-based organization, in particular, those who stimulate the integration of opposites, monitoring progress is essential. The way to do this is quite simple.
At the beginning of each process, we ask participants where they are on the dilemma grid and after a while what progress they have observed. Furthermore, what are the evidence-based incidents (if any) they can describe the progress with? Finally, questions are asked whether the dilemmas chosen to work on are still valid and worth the investment. These data are accumulated and processed by leadership and appropriate actions are taken.
In order to make cultural change stick, we argue that first of all, culture needs to be instrumental to serve the achievement of strategic goals and reconciling the major strategic and cultural dilemmas. The process of change is rather an enrichment process (by integrating opposite orientations) than a replacement one and the role of the leader is crucial in the success of the implementation. For the interventions, this means that you start with the diagnostics of the business and cultural dilemmas. Then it is time for a dilemma reconciliation process ending with action points and recommended values. As the next step, it is crucial that this is followed by an implementation process called ‘Values to Behavior’. Finally, a process that monitors progress should be put into place. However, in all stages, the role of the leader is crucial.