Organizational culture has reached a tipping point, yet many culture change initiatives fail for four key reasons

Thinking

My fascination with culture began more than 40 years ago when another young industrial engineer named Jim Delaney and I started a process improvement consulting firm not long after graduating from UCLA. I quickly discovered that it was easier to decide on change than to get people to change. I observed that companies, like people, had personalities, and while some were healthy, most were like dysfunctional families. They had trust issues, turf issues and resistance to change. The difference between working with Sam Walton on the supply chain at Walmart and working with Woolworths was like night and day. It was clear one company would succeed and the other would fail because of the mindset and habits of the firms.

That led me to a professor at University of Southern California who had published a book containing articles that described a phenomenon called Organizational Character. Since I had clients, he convinced me to join the doctoral program and conduct research on the phenomenon. My dissertation, published in 1969, became perhaps the first field study ever of corporate culture at the organizational level.

[Watch this video with Larry Senn describing the evolution of culture shaping as a successful strategy to improve spirit and performance.]

A central culture finding
The central finding then, which holds true today, is that organizations become ”shadows of their leaders”. We knew early on that culture change had to start at the top. If the senior team didn’t collaborate for the greater good, then the organization would have turfs and silos. If they were too hierarchical and controlling, you’d find that culture from top to bottom. We found we could diagnose the culture but the challenge we faced was, how do you change habits of adults especially successful senior leaders?

Freezing and unfreezing habits
That led to a second breakthrough finding. I had a major life event that created some epiphanies that changed how I saw the world and changed some of my behaviors. My research into change through aha moments uncovered the work of Kurt Lewin, an early social scientist. One thing he said helped create Senn Delaney as a culture-shaping firm and enabled us to shape behaviors in new more powerful ways. He said “When we are young we are like a flowing river – and then we freeze.” His theory was that we get frozen into habits, and unless there is some form of unfreezing, we stay stuck. Lewin was also a believer in the need to treat not just the leader, but the team, the organization and the whole system. As a result, we began to experiment with insight-based learning modules for CEO teams around the behaviors in a healthy, high-performing leader, team and organization. We called those the Essential Value Set.

Up until then, almost all behavior change in business was based on a behavior change model defined by American psychologist and behaviorist B. F. Skinner. Define what you want and reinforce it. It is a sound model that we employed to reinforce change after the epiphanies, but not powerful enough for embedded habits.

Interest in culture shaping emerges
There was not much interest in culture shaping when we formally launched the firm in 1978. Our first clients were retailers that wanted to have what Nordstom or Walmart had. Nordstom had the ultimate in customer service, and in those days Sam Walton had a very efficient organization with his greeters and happy boxes. Retailers intuitively got that the customer experience was a cultural thing but generally thought it was a stores issue. We stuck to our guns and when asked to create a service culture, we would say, “Only if we can start with the CEO team since the stores are the children of the whole organization.”

Major changes surface the imperative of having a healthy culture. Divestiture and the breakup of Ma Bell in the phone industry led to culture shaping there. As Ray Smith, then CEO of Bell Atlantic and later Verizon, said, “If I put my ear on the track I can hear the train coming and we are not ready — we have to change or die.” Over time, more and more industries have faced change and thereby faced what we call “the Jaws of Culture”.

The tipping point
Organizational culture has reached a tipping point. Most CEOs know that culture matters and can have a strong impact on business results. Studies now confirm it is considered as important to success as strategy, and in fact it should be a strategy in and of itself. That is the good news.

The bad news is that despite this broad executive understanding of culture, and the many studies and books written over decades to demonstrate the link between culture and performance, the fact remains that too many culture change efforts still fail or fall short of their potential.

Why culture shaping efforts fail
We have shown through our work with more than 100 Fortune 500 CEOs and hundreds of companies around the globe that successful culture transformation is possible, and we have demonstrated along the way that there are four key principles that must be followed for this to occur. I will detail those principles in future posts, but for now I’ll start by touching on the major reasons culture-shaping efforts fall short.

  1. It is an HR initiative and is not led from the top. HR has a critical role in making culture change work, but as General Joe Robles, CEO of USAA, the company with the highest customer loyalty in America, says, “I’m the chief culture officer.” Watch this video with Joe Robles talking about leading the culture.
  2. The process doesn’t create deep personal commitment to change. It is too intellectual and not transformational. It may create some understanding through such things as 360 surveys, but does not produce transformational ahas.
  3. There are too many disconnected initiatives, and lots of activity, but culture is not clearly managed as a strategy. Every system and communication process needs to be aligned with a clear definition of the desired culture, which covers the Essential Values.
  4. It is not taken from top to bottom in a way that creates momentum and mass. Cultures have antibodies and lives of their own. The process has to have the feel of “the train is heading North and you better get on.

While the awareness of the importance of culture has clearly grown over the last 40 years, these reasons continue to undermine the vast majority of culture change efforts.

Has culture reached a tipping point? Do you agree with these reasons why culture change efforts fail? What can you add?  Please provide your comments and feedback below.

Editor’s note: this is the initial post from Dr. Larry Senn.  See the following press release regarding his addition as a distinguished faculty member. We value his contribution to the history of the organizational culture field and the sharing of his insights to help others.

Photo Credit: Christian Guthier – FlickR photo modified with quote

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Dr. Larry Senn is a pioneer in the field of corporate culture. He is chairman and founder of international culture-shaping firm Senn Delaney, a Heidrick & Struggles company. Larry's vision and leadership for more than 35 years has helped Senn Delaney become an international firm that is widely recognized as the leading authority and practitioner in the field of culture shaping. Larry has led culture-shaping engagements for the leaders of numerous organizations, including dozens of CEOs of Fortune 500 companies, state governors, members of two U.S. president's cabinets, deans of business schools and the presidents of major universities. He is an accomplished consultant, business advisor, group facilitator, author, CEO coach and public speaker. Larry has co-authored several books, including Winning Teams, Winning Cultures and 21st Century Leadership. In 2013, he published his latest book, Up the Mood Elevator: Living Life at Your Best. This book reveals some profound principles, fascinating concepts and useful practical tools to help people improve their experience of life, enhance results, build better relationships and create success with less stress. Prior to founding Senn Delaney, Larry ran his own retail business in college, was a senior engineer in the aerospace industry and a faculty member at University of Southern California and University of California Los Angeles where he taught leadership. Larry has a BS in engineering, an MBA from UCLA, and a doctorate degree in business administration from USC. Read his full bio.

Please note: I reserve the right to delete comments that are offensive or off-topic.

  • http://www.gatelyconsulting.com/ Robert Gately

    Hello Larry,

    Change efforts fail if executives/managers think behavioral changes are needed for everyone but themselves. 

It is easier to insist that others change their behaviors than it is to change our own behaviors. 

Change efforts are necessary when those in charge don’t change their own behaviors.

    Culture change initiatives fail because…
    1. Executives focus on changing their employees’ behaviors
    2. Executives don’t/won’t/can’t change their own behaviors
    3. Employees have been developing their talent since they were born; 16 hours a day, 5,840 hours per year, or 128,480 hours by the time they reach the age of 22. Training isn’t likely to change what they have developed over the 128,480 hours

    It is far easier to change our own behaviors than to change other people’s behaviors and changing our own behaviors is nearly impossible for most of us without wanting to change and without help. Telling and insisting that others change is a fools errand and is a cause of employee disengagement.

    If an employer is serious about changing the culture they need to change who they hire.

    • paul diniakos

      I agree that if mid-level managers loiok up and see that their leaders aren’t “shifting” their behaviors than why would they? Same goes for the associate level employees. If they look up and see the mid-level managers not “shifting” than why do they care?
      That’s why Senn Delaney starts at the top Senior Team to cast a shadow that cascades down through the organization. I dont think we can get people to change but I think we can shift their thinking about their current habits and behaviors.

    • Tim Kuppler

      I agree with the point about changing who they hire since people are hard-wired at an early age. I do think most people have not experienced an engaging and meaningful culture. Attitudes and behaviors will shift if they are truly engaged in influencing initial improvement priorities and a support structure of revised systems, habits and leadership behavior grows to reinforce the behavior change.

      I used to specifically target long service employees with the most deeply entrenched views about what would work (and what would not). I included them in group feedback and prioritization activities that influenced key improvement priorities. I would continue to meet with them at least until we made clear progress in their eyes. When I saw their behavior shift and their feedback change to support the improvements (because they were involved, top ideas were acted upon with focus, AND we achieved results with a specific connection to a problem, challenge or goal) then I knew we were reaching “the tipping point” where momentum, support and results would grow at a faster rate with all employees.

  • http://www.ThreeBellCurves.com/ Bernard Rosauer

    Excellent piece Larry.

  • Eric Bot

    Larry, a few things come to mind when reading this piece.

    First was that you do not ask the turkey what’s on the menu for christmas dinner, meaning to chnage a going concern immediatly hits upon its own restrictions and lack of span of control and foremost poor distribution of power. It shows how little influence and control executives have on all fronts.

    second; Think in terms of internal/external branding: every organization functions within a group of stakeholders, communcation lines are set and resist change, all of these relationships would have to be adressed simultaniously and not only comprehend any change but also accept it. That is a tall order.
    The surrounding organizations are also facing similar restrictions and challenges.

    This requires a revolution a evolution ( more gradual) will not push through resistance and fail due to the lack of speed and cohesion.

    It touches upon organizational design, power distribution, hierarchy, span of control, re-allocation of competencies, roles and functions and as mentioned; doing this while running, no shut down for renovation, and requiring acceptance and support by all stakeholders 360 , tall order…

    have fun

    • Tim Kuppler

      Great comments. I agree with the revolution vs evolution point. There’s a “culture tipping point” organizations reach where momentum and support builds at a much faster rate. Unfortunately, the scope and speed of change falls short of reaching that point in many change efforts because leaders don’t know the areas to specifically address to build initial momentum or they go at the change without the sense of urgency to deliver results. My opinion is that if the organization doesn’t see some meaningful results in some form within six months then they may never get there (of course those meaningful results may be seen in “leading” indicator areas that will lead to the final “lagging” indicator – revenue, profit, etc. – improvement).

  • Mahendra K Shukla

    It was a wonderful “Eye Opener” from the founder which is having relevance across the globe. I underwent the same kind of experience while working with Indian / Foreign companies. The culture of an organization is strongly dominated by the top management who are at first place not willing to change or just allow some minor adjustment.

    It require tremendous passion and drive to convince them to adopt a different culture because their mindset is fixed by a ” Successful / Achiever Thought” which was helpful in maintaining their dominance. Many of the HR & OD specialist like me attained less success with personality cult driven organization until they take the bull by horn.

    • Tim Kuppler

      Helle Mahendra, thank you for the comments. One of the most significant obstacles to change, in most situations, is building understanding that there must be behavior change at the top. It is amazing that there could be indisputable information from customers, employees or the bottom-line of the organization and top leaders focus on how everyone else must change and improve.

  • http://www.adcurata.com/ Mark Edwards

    A fascinating analysis, although we are not entirely in agreement with the sentiment that the process should have the feel that “the train is heading North and you better get on.” This suggests that the employees of an organisation might be compelled to adopt a particular culture. Our view is that it is far more likely to result in a successful outcome to create a process that has the feel that “the train
    is heading North and the journey will bring a much better life for you – and the company – if you get on board.”
    We have a number of articles on this subject and would welcome your feedback – http://www.adcurata.com/articles/

    • Tim Kuppler

      Hello Mark, I completely agree with your point. He didn’t go into any detail about the best way to create that feeling that “the train is heading North” but it of course has a much better chance of success (it may only succeed) if it’s viewed as a direction that most people view as better for themselves and the organization. He may address this in a future post at CultureU and there is additional specific content related to purpose and other areas on the Senn Delaney site. Thank you for sharing your articles – excellent content!

  • LARRYSENN

    I may have conveyed an incorrect notion by using the phrase – The train is heading North. Several of you commented on that. Momentum and mass is a powerful culture shaping principle and it needs to be positive energy. Since our process provides great benefit to the quality of lives of people and they talk about it, the momentum is an attraction or pull system not a coercive push phenomenon.
    When people see their leaders behaving better, being in better moods and appreciating them more they want “in on it” That is the train I referred to
    Larry Senn

    • SDTV_Moderator

      Thanks for the further explanation of the power of momentum and mass and the effect of positive energy. I’ve observed that when energy and positive feelings are high in a company, there’s a great and invigorating ripple effect. I’ve also been in bad cultures, where leaders actually kicked garbage cans around the office and swore at people. You can imagine the ripple effect that leader had below him. I can tell you no one wanted to get on his train!