Get Reworked Podcast: Why Now Is the Perfect Time for Culture Renovation
One of the most powerful, if not the most powerful, forces in a company is its culture. It's also one of the least understood.
In this episode of Get Reworked, Kevin Oakes, CEO and co-founder of the Institute for Corporate Productivity, joins us to talk about his research into company culture and what he's learned about what makes good corporate cultures work. Those ideas are summed up in his recent book, Culture Renovation: 18 Leadership Actions to Build an Unshakeable Company. It's a timely conversation to have right now.
"The pandemic has changed almost every culture, like it or not," Kevin said. "So the question for companies is, do you want to sit back passively and allow that change to your culture just happen? Or do you want to proactively try to shape the culture you want for the future?"
In this episode, Kevin talks about how to succeed in culture change efforts. Highlights of the conversation include:
- Why most culture change efforts fail.
- Why it's important to think of culture work as a renovation vs. a transformation.
- How to include people at all levels in change efforts and identify influencers, energizers and blockers.
- How to keep up energy for culture change when we go back to the office.
Plus, co-hosts Siobhan Fagan and Mike Prokopeak talk through why the culture conversation is important right now and narrowly avert their own clash of cultures over the topic of oatmeal raisin vs. chocolate chip cookies.
Have a suggestion, comment or topic for a future episode? Drop us a line at [email protected].
- Kevin Oakes on LinkedIn.
- i4cp on Twitter.
- Kevin's Book: Culture Renovation: 18 Leadership Actions to Build an Unshakeable Company.
Note: This transcript has been edited for space and clarity.
Mike Prokopeak: Hello, and welcome to Get Reworked, your guide to the revolution of work. My name is Mike Prokopeak and I'm editor in chief at Reworked.co.
Siobhan Fagan: And I'm Siobhan Fagan, managing editor for Reworked. At Reworked.co, we're dedicated to covering the people, the culture, the technology and the infrastructure that makes up our quickly evolving workplaces.
Mike: Get Reworked is our podcast, brought to you by Simpler Media Group, where you'll hear from industry pioneers leading the way into the future of work, reshaping not just how we work, but also why. We're excited to bring you conversations about best practices, workplace trends and key technologies that support the modern distributed workforce.
Siobhan: Hey, Mike.
Mike: What did you have for breakfast today?
Siobhan: I had a piece of sourdough bread with butter and honey. How about yourself?
Mike: I had a bowl of cereal with raisins, Kashi, if you're curious.
Siobhan: You're in the pro-raisin camp.
Mike: Oh, I think oatmeal raisin cookies are, hands down, better than chocolate chip.
Siobhan: Oh man. Alright. Alright. This is going to get ugly.
Mike: Are those fighting words?
Siobhan: We should we should probably stop right there, Mike, because this could get ugly.
Mike: Well, I asked the breakfast question because there's that often-used quote that culture eats strategy for breakfast. When we're talking about organizations, the idea being that you could have the grand strategy, that you could have it all so well thought out and have it be perfect on paper, but that the culture of an organization — the ways and means that things get done — that is vastly more important than that strategy. And it's actually, I think, in many cases attributed to the management thinker, Peter Drucker, but I don't think that's actually true that he said that. I tried to do some research on it one time and wasn't able to actually find that that reference is attributable to him.
Siobhan: It's highly questionable if he said it. It's usually attributed to him. I saw somebody making an argument about that, and I'm not going to remember who the manager was, but it was somebody at Ford who popularized it. But yeah, definitely not Peter Drucker.
Mike: Alright, I brought it up because our guest today is going to be talking about culture. Kevin Oakes is the CEO and co-founder of i4cp. They're a premier HR and consulting organization. He does a lot of speaking on culture. He does a lot of research on culture. He's the founder and president of SumTotal Systems, which he helped to create in 2003, and then merged it with Click2learn.
And he has written a book that came out early this year called Culture Renovation: 18 Leadership Actions to Build an Unshakeable Company. So I'm eager to dive in and talk a little bit about culture and transformation within our organizations. So are you ready, Siobhan?
Mike: Alright, let's Get Reworked.
Welcome to the podcast, Kevin Oakes.
Kevin Oakes: Hey thanks, Mike. Great to be here.
Mike: So you were recently on Brene Brown's podcast. How do you know Brene Brown?
Kevin: Yeah, Brene is great. She keynoted at our conference. We do an annual conference most years, most non-pandemic years, and a couple years ago, she was a keynote or at our conference and we've struck up a friendship since then. And I've been a supporter of just what she's been doing, overall. And she was originally going to write the foreword for the book but I ended up having Tom Rath write the foreword. And Brene has, you know, a really nice endorsement on the cover of the book. And she just really likes the subject matter. She likes the book a lot and asked me to be on her Dare to Lead podcast, and I'm certain that is probably the single best source of book sales for me to date.
Mike: I bet. I've known of her for a couple years but I didn't realize how big she was until about two years ago when I went to the Society for Human Resource Management conference. I think it was 2019 and she was the keynoter there. It was like the Beatles coming to America for the first time. The audience reaction to her. I mean, I think she just speaks to people on a much different level, that is goes beyond, you know, the pure intellectual aspects of being a researcher and sort of thinking about the future of work and how we lead and all those sorts of things. It's a different connection she has with her audience.
Kevin: Oh, she's a rock star these days. She was featured on 60 Minutes a little while ago. I've seen her on Jimmy Fallon a couple times. She's now coaching different celebrities. So she really just resonates with so many different audiences and so many different people. I don't know how she has time in the day to do it all.
Mike: We're going to talk to you about your book and your work, your book being Culture Renovation: 18 Leadership Actions to Build an Unshakeable Company. And obviously, we're not going to have time to get into all 18 actions. But we do want to touch on a few things.
But I want to start with a question of vocabulary because I think it's an important one. As we talk about the revolution of work here at Reworked, as we sort of look at this future of work, we often use this word transformation to talk about how we move forward. That we need to transform our companies, we need to digitally transform, we need to transform ourselves culturally. But you very specifically picked the word renovation, when you talk about culture and what companies need to do. So can you explain why you chose that word?
Kevin: Yeah, let me give you some of the background on how we looked at this whole category and why I wrote the book to begin with. We had done a research study a couple years ago now on culture. And our goal in the research was to recognize that most culture change efforts fail. In fact, only about 15% actually succeed. But we wanted to hone in on those successes, and see if there was a blueprint or commonality between companies that successfully change their culture. And sure enough, there were a lot of commonalities and that's what makes up the 18-step blueprint. But as we got into this study, and I was working with the research team, and looking at the different case studies of companies that have successfully changed their culture, it was pretty clear to me that the common term of culture transformation wasn't at all descriptive of what these companies had done.
Almost none of these companies completely transformed their culture. In fact, I think that's almost impossible to do. Instead, they were very intentionally renovating their culture, and much like an old house they were keeping components of their culture and of their company that were really core to their uniqueness and core to their success, and hard to replace, and renovating around that for the future. And so many of these organizations, had a purpose that still was very in line with where they wanted to go going forward. They had values that were core to what they wanted to do as a company, and they didn't want to lose those values. But many of them upgraded. They added some values or slightly changed them. And when it came down to the culture itself, they wanted to make sure that they really respected the past in what got them to where they are today in order to build for tomorrow. And so renovation just became a much better term to use to describe what successful companies do.
Mike: Is there a company that you can use as a metaphor of a renovation? Maybe one that we recognize, I know, you talked about Microsoft quite a bit in your book, but is that a good example of the renovation vs. the transformation idea?
Kevin: Oh, they absolutely are. And there were several others that I highlight in the book, Mike, that are, but you know, Microsoft is a great example. I think Satya, and what he and the team did is a marvelous case study for any company to follow on how to do this right. They recognize that they were already a successful company. There's a lot of things that made Microsoft the company they were today. But he also recognized there were things that needed to change if they were going to continue to be successful going forward. He did change the purpose of the organization. It used to be to put a computer on every desk in every home. And that always kind of bugged Satya that that was a purpose statement that had an end state. And frankly, in the developed world, we're basically there. And so they changed their purpose to be all about helping people achieve more, and it was a purpose that really lent itself to a lot of the products and services they provide.
The same is true for 3M. I love talking about that organization because they're a very old company started in 1902. And they've reinvented themselves several times over that time period. And I shouldn't say reinvent because really, they embody renovation overall. There are certain things that are just core of 3M, such as innovation, or giving people time to work outside of their responsibilities and come up with new ideas and new products and they label that 15% time. They created that in the 40s and 50s, long before Google ever created their 20% time. And those types of things within 3M's culture are things they want to hold on to. And that's what's near and dear to their company. But Mike Roman, who's their CEO, who I interviewed for the book, recognized there's a lot of things we've got to do in a new digital world that are different. And they've been just sort of systematically changing their culture to make sure that they're best prepared for that future world. So I think those two companies, but there are so many others in the book that are just great examples of this renovation spirit.
Mike: Alright, so looking at this from a manager perspective, so somebody whose job it is to sort of figure out this future, one of the things that you argue is that as we focus on transformation that we would lose sight of what makes a company great in the first place, that we can maybe even betray our current employees, some of them may be long-term, who might feel insulted that I've put so much of myself into this work in this workplace, and now you're telling me we need to transform it. So how do you make sure that people feel included as part of that process? If you're in a company that is perhaps struggling, and maybe doesn't really know its purpose, where do you kind of start with it?
Kevin: So I have several examples in the book that I think talk to that very question, Mike. One of them is from a company called F5, which is a networking-based company in Seattle. And I love the quote by their CEO François Locoh-Donou. And what Francois said, when he came in as a new CEO, that he's seen this movie before. It's very easy for a new CEO to come in, and say, "Hey, we got to do things completely different going forward. And I'm going to really shake things up and turn this company around." And he told me, Kevin, while I wasn't using the term renovation, it was exactly what I was trying to do, because I thought it'd be very dismissive to all the hard work and all the great efforts and successes that people in the company had had before I arrived on the scene.
And so well, you don't want to not acknowledge any missteps in the past, which often are a catalyst for trying to change culture, you really want to look forward and paint a vision for the long term. And so culture change, we say very emphatically in the book needs to be leader led. And really, it needs to emanate from the CEO and senior team on down, it's very hard to change culture, if they're not leading it, not on board. But it's also hard to change culture if the company is not on board.
And, and so one of the steps in the 18 steps is creating a co-creation mindset inside the organization, and making sure that you've got the workforce on board and contributing with the culture change that you have in mind. But that "not blame the past" aspect is just so important. And I showcased a couple of examples, like when Carol Bartz came into Yahoo, and just very quickly insulted all the workers that had been there and what they had done in the past. And she, as a result, turned off the entire workforce towards her and she lasted just a little over two years as CEO. I think that's the risk you run as a leader of an organization if you don't have that co-creation mindset and don't really acknowledge that great effort that's happened already.
Siobhan: Kevin, is it easier for a company to change its culture when it does have this new CEO walking in? I mean, Satya Nadella being a case in point where he was at the company but he was sort of an unexpected person to step into the role after Ballmer left, or is it just a broader challenge? If it's an existing CEO, who suddenly recognizes, this is time we need some change?
Kevin: Yeah, I don't know if it's easier or harder Siobhan to do it as a new CEO, but it's a common catalyst for culture change to happen. Usually, culture change happens when an organization has had poor business performance, you know, maybe a recent string of poor earnings periods. A new CEO, an acquisition is another common catalyst in the organization. Those are all things that often will kick off a culture change. But I've seen several existing CEOs who have been around for many years do it very successfully as well. And in some cases, I think they bring a credibility to the effort that maybe that new CEO coming in, where employees are a little bit skeptical of that new CEO, that credibility of the existing CEO can really help in long-term cultural success.
Mike: That raises the question, Kevin, about our current moment, which we've managed to get a few minutes in here without really acknowledging that. Have we basically created this moment that is, for everybody to embrace this right now, this culture change moment? So, Siobhan's question when a new leader comes in, you know, is that a good time, bad time, is now a good time to embrace culture change, from your point of view, Kevin, or is this maybe not such a great time given everything that's going on in people's lives as they're at home dealing with the chaos that's created by the pandemic in their workplaces?
Kevin: You know, I think the pandemic has changed almost every culture, like it or not. So the question for companies is, do you want to sit back passively and allow that change to your culture just happen? Or do you want to proactively try to shape the culture you want for the future? And we're all looking to a post-pandemic future, I think we all acknowledge is probably going to be quite different than the pre-pandemic way of working. But do you want to proactively do something about it. And I've been talking to a number of organizations who are obviously taking the approach around the latter, and looking at a culture that is more remote than it used to be, but is a very distinct culture regardless. And there's a lot of things I think in organizations that have changed for the positive during the pandemic, as well as the negative.
I'll give you a couple examples. So on the positive side, I hear over and over and over again from companies that leadership and the senior team have shown much more empathy towards the workforce than ever in the past. And workers have a window into their co-workers' lives and even to senior leadership's lives that they never had before. And they're seeing the whole person, and everything that goes with it vs. just the business persona. On every Zoom call, you're seeing dogs and cats, and then children, and sometimes you're realizing that people are caring for elders in their household, and you get a much better perspective on the people you're working with.
On the negative side, you know, I think what we've lost during the pandemic is serendipity and the innovation that occurs with it. You don't have those chance encounters inside of the organization and some of those things that will spark innovation inside the company. It's hard to schedule innovation over Zoom, although I think companies are doing that today. And certainly some collaboration as a result has been more scheduled and more formal than it was in the past. And those are things that companies have worked hard to get around.
We could probably rattle off several other things. But I think those are the realities to the culture today, in a lot of organizations, they've seen some pluses that they want to keep. And there's concerns that if we go back to the way things were, maybe we'll lose that. But there's also some negatives that they've had to try to overcome.
Siobhan: Do you think it would be possible for cultures to go back to where they were?
Kevin: Yeah, you know, when we're talking in generalities about any company whatsoever, you've got to recognize that there's so many different industries and types of organizations out there that it's hard to paint a broad brush that applies to all of them. There are companies that have had essential workers onsite right from the start of the pandemic, and things have never changed for those organizations. In some of those organizations, you're finding that there's some discomfort with the fact that some people have been remote the whole time and others have had to be onsite. And then other organizations where everybody's gone remote.
I've talked to several CEOs, I had a great conversation with the CEO of MasterCard a little while ago around this. And again, that broad brush is dangerous. He was admonishing some CEOs for saying that remote work is fantastic and we're going to go all remote and get rid of our corporate real estate. Because it's easy to say that if you're sitting in your 7,000-square foot house with awesome Wi-Fi and your separate home office, but for a lot of companies they've got operations that are all over the world. And they've got employees that are living in one bedroom apartments with maybe a mother-in-law and kids and, you know, being in the office was the respite. You know, and we've all heard the stories where people are having a tough time in this remote environment because they just don't have the facilities to make it productive.
The flip side is we've had some CEOs like Jamie Dimon at JPMorgan Chase, Reed Hastings at Netflix, who have said that remote work is not productive and that they want all employees back in the office because that's the only way that you can be 100% productive. And there are many employees who have railed against that. And I think that's a dangerous stance to take as well. I think from an employer brand perspective, you're not going to attract employees who are looking for more flexibility going forward.
So again, the broad brush I think, is tough to paint across companies but even within a company everybody's situation is so different. I think more and more organizations are recognizing they have to be flexible in how they're dealing with the workforce because you just don't know what the individuals are wrestling with on a day-to-day basis.
Mike: You evidently have seen into my home environment, Kevin, when you mentioned the 7,000-square-foot home with awesome Wi-Fi, that's me. And in fact, you know, we were talking before the podcast, my son was having drama class via Zoom just before we got on this. So there is this sort of idea that, you know, we're all seeing each other differently as people as a result of this. And that can't help but be good for culture. But you know, as we're going back into office environments, in some places it may be faster than others and more completely than in others, that there's going to be this desire to revert back. You know, oh, we're back in the office, pretty soon those old ways of working, those old ways that we approach things are going to kind of come back in, maybe not immediately, maybe not dramatically, but they'll seep back into things. So how do you avoid having that happen? If you're embarking on this culture renovation, if you're really trying to create a renovated culture, a stronger culture as a result of this? How do you avoid having some of those reversions back to the mean?
Kevin: Let me answer that two different ways. Mike. First of all, I don't think life in the office is ever going to be the same as it was before. And I think in the short term, there's a number of issues that organizations are wrestling with today and recognize they will wrestle with that we really haven't fleshed out. I've been talking to several CHROs of Fortune 100 companies, and the issues around vaccination are very tricky. Do we have people come back into the office that we're not sure have been vaccinated? Do we require vaccination or just strongly encourage it? Most companies are going the strongly encourage route, but some are requiring it. How do I deal with the anti-vaxxers which is a much larger percentage than I think anybody would have ever guessed? Am I forcing people to go back into the office with anti-vaxxers even if I get the vaccine? And can I still transmit the disease and what's the risk to my family? What are the issues globally, right? Every culture globally is dealing with this a little bit differently.
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So it gets really, really complex. And I've been having some fascinating conversations with CHROs, as they think through this and involve a lot of medical experts, but even legal experts. And there's always this exposure risk. I've talked to several companies where they've already had employee lawsuits around being exposed at work, and maybe, you know, a severe illness or a death ensued. And so they're suing the organization. I think all of those issues are going to be tough for companies to wrestle with.
But when it comes to just changing culture, let me just tell your audience how we divided up the book, we've already said there are 18 action steps that the research uncovered to successfully change the culture overall. And using that renovation theme, we divided those action steps into three phases. And those phases are plan, build and maintain and so there's six action steps under each.
What a lot of companies end up doing when they want to change cultures, they dive right into the build phase. And it's really, really important to take a step back and look at all the things that are in the plan phase and make sure that you're understanding the culture you have today, that you've got a deep listening strategy, that you're really figuring out what you want to keep and setting that cultural path, defining the behaviors that you want to see overall, before you jump into that build phase. But then to address what you just talked about, you know, sort of reverting back that maintain phase is one that I see ignored a lot. And as a result, companies can over time just shift back to the way things used to be after all the hoopla around culture change. And so it's important from a maintenance perspective to really take into account some of those talent actions that we put into the maintain phase to keep that momentum going forward.
But you're never done with this, Mike, and I end the book with that concept. In fact, Ashley Goldsmith at Workday, she's the head of HR there, ended the book by saying culture change is never done. And Microsoft has certainly taken that attitude. Kathleen Hogan the head of HR at Microsoft told me more than once, you can't just put a flag in the ground and make a declaration and say we did it. They're constantly working on the culture. In fact, they get nervous when I talk about what a great job they've done with culture because they feel like they still have a lot of things that they want to improve on going forward, which is healthy. So you've got to constantly work at this going forward.
Siobhan: Kevin, I imagine part of that is having the buy-in of the employees and the full participation of the employees obviously to get it off the ground. We've talked about the strong leadership that the CEO can do to set this foundation, but how do they actually get this full buy-in from their employees, and you have steps throughout the book in the plan, the build and maintain. And I was just hoping you could walk us through there?
Kevin: Yeah, it's a great question, Siobhan. And I think the first step is just figuring out what employees you want to enlist in this effort. And so one of the steps that I think is very critical and important one is identify influencers, energizers and blockers.
And by that, I mean, in any organization you have certain people that are the go-to people in the company, all the workflows seems to go through them, they're a subject matter expert, they're really just an expert on how things work inside the organization. And they're the people that kind of make the organization hum and that everybody turns to. In fact, as I'm saying that I bet a bunch of your listeners are picturing somebody in their head that embodies that. We call those people the influencers in the company. And you as an organization, if you want to change culture, you need to get those influencers in line and aligned with what you're trying to do from a cultural perspective long term.
Some organizations have called those people culture ambassadors, and they've looped them in early to make sure that they can help at a ground level get that word out and support it long term. We also call some of those people energizers, because although you've got influencers they may not always be the energizers in the company. And by energizers, I mean, these are people when you go talk to them, you walk away from that conversation just pumped up and excited for the future, and they just made you more positive and happier than you were going in.
Conversely, you've got folks that when you talk to them, they just suck the life out of you. It's like Darth Vader, right. You leave depressed almost every time you talk to them. And you want to make sure those energizers are also part of that culture ambassador set so that you can, over the geography of the company and the hierarchy of the company, really champion what you're trying to do with culture.
The same is true for blockers. And I talk about ferreting out the skeptics and non-believers early. It's important to understand who those people are, sometimes they're in pretty senior roles. In most successful culture renovations, the CEO and senior team, but even down to lower levels, they made sure that they either convinced those naysayers about what they were trying to do and got them on board or they moved them out of the way. And a lot of times you get those blockers really thwarting your plans because their power is being usurped. Or they, you know, they feel like it wasn't their ideas. There's a lot of reasons why people sometimes visibly sometimes invisibly, try to thwart the effort. And it can be thwarted if some of those people are in very powerful roles. But broader than that, once you've got those people identified and on board, there are several stories in the book about how companies have really enlisted the help of the broader employee base to help with a culture change.
Ford, for instance, did a culture hackathon just like a regular hackathon, if you're familiar with that concept, but all around corporate culture, and they did it all over the world and just generated hundreds and hundreds of ideas from the workforce on what needed to stay and what needed to change and how to change it. And I think that's another great way to get the workforce involved in the culture change.
The last thing I'll mention on this too is, Microsoft again is a good example of this, it's important to rally the workforce around some deep but simple concepts. For example, in Microsoft their culture change will forever be identified with growth mindset. And Satya read the book by Carol Dweck called Mindset and fell in love with the concept that it's not knowledge that's power, it's knowledge sharing that's power. It's the concept that I want a bunch of learn-it-alls in my company, not a bunch of know-it-alls. And I want people who recognize that skills and capabilities are not innate, they can be learned. We can grow and when we make mistakes, we should learn from that. And that concept of growth mindset is throughout the organization. I'm always impressed when I talk to people in Redmond that are you know, that just work for Microsoft. To a person they can tell you chapter and verse what growth mindset is all about because they've done a great job at educating the workforce and putting visual reminders about growth mindset around the company. And their culture change really rallied around that term. Another thing that I think many organizations can learn from if they're trying to successfully change culture.
Mike: So, you know, I'm thinking about this, from a Midwesterner's point of view, and we've got a term, it's called Minnesota nice in the Midwest, it's sort of like this idea that no matter what we actually think, on the inside, we need to show this sort of external niceness and treat people nicely, regardless of how we may actually feel truthfully, on the inside. And I think that kind of translates to companies. And when companies talk about culture, they think about it as a nice place, people are happy and satisfied. But that's not the same thing as being successful. So how do you balance being, quote unquote, nice, with being brutally efficient, and really focusing on where we're going forward?
Kevin: It's funny, you bring up that term, Mike, because I worked for a company early in my career called Minnesota Mutual. And I've learned that term Minnesota nice by many trips to the corporate headquarters in St. Paul, and just throughout the organization, I think that attitude honestly can be very destructive to an organization because it means you're, you know, essentially being fake or not transparent inside the company. And Brene Brown and I talked about that on our podcast, she has a rule inside her company that if you can't say it in the meeting to the person's face, you don't say it behind their back after the meeting occurred. If you disagree with something you disagree, outwardly, in fact, Amazon and Bezos have talked quite a bit about that we have to agree to disagree, disagree, and commit and then move on. And that kind of attitude, I think, can be very helpful to organizations from a progress perspective, otherwise, you just kind of, you're just turning in the sand, you know, if you're not being transparent, and expressing your true views, a lot of successful companies have transparency as a value. In fact, I adopted that as one of our values because of that, and so we try very hard to make sure that everybody is transparent with each other.
That's just one example of, you know, a value and an attitude that I think has to emanate from the top, if the senior team is practicing Minnesota nice then everybody else will. But if the senior team is practicing transparency, and directness, with respect then everybody else will, those are the behaviors that you've got to emulate at the top and then train and propagate throughout the organization.
Siobhan: Kevin, I interviewed a woman, who works with a big tech firm, a few years ago, not gonna mention the company, although it's great for them. And I asked her to describe her company culture in one word, and she used the word kind, which left me kind of flabbergasted for a few moments. It's not a word that I would normally associate with a company culture. But it was lovely to hear it, honestly got me a little teary eyed, thinking how nice it is that somebody I mean, this was not going to be for public view, or anything, would say that about the company. So I was hoping you could talk a little bit about what not necessarily those adjectives, but what kind of signs we can look for, for a successful healthy company culture.
Kevin: I do think it's nice to choose the word kind, I think you're seeing more of that these days. More companies are expressing an empathy that they didn't have before. But there are different adjectives that people use to describe their culture all the time. And we did create an index called a healthy culture index to try to capture some of the things that high-performing organizations really say about their organization that, you know, identifies a healthy culture overall. So I'll give you some examples of that index, nurtures innovative thinking and its application is highly collaborative values, execution and accountability is obsessed with delivering value to external customers. Yeah, let me come up with a few more for you because there's a graphic that I use in the book and one that I think is a good one for organizations to look at when we're talking about healthy cultures. But we also talked about valuing transparency, viewing failure as an opportunity to learn and grow, valuing societal impact as much as financial impact. These are all traits of a healthy culture and the data supports it. Companies that are high performing organizations, meaning they have better revenue growth market share profitability than their competition. They will use those terms more than low performing organizations will.
Mike: Alright, Kevin, So I want to take a little bit of a pause and do an underrated-overrated segment with you. So we'll throw a few topics your way you tell us whether or not you think it's an underrated concept or an overrated concept. Are you ready to play along with us here?
Kevin: Fire away, Mike.
Mike: Alright. So HR as a strategic role. Is that a concept that has become overrated or underrated in our organizations?
Kevin: Oh, absolutely underrated. What's really really heartening to me is seeing HR's role become more and more strategic over time. And I love walking into organizations where it's really clear that they value HR. And you can tell that because the head of HR is typically certainly reporting to the CEO, but typically in that inner circle of three to four key executives that are strategically really guiding the organization. And I talked about that in the book, you see so many strategic CEOs mentioned in the book, because they were so instrumental in the culture change in that organization, and making the organization a great one.
We're also seeing this at the board level, Mike, more and more boards of directors are recognizing they probably over-architected on financial acumen, and under-appreciated human capital acumen at the board level. And this came out loud and clear during the pandemic. And so I've talked to many chairs of boards and other directors who are actively trying to add human capital expertise to the board, either a current or retired CEO. They're also trying to put more measure on on organizational culture, and they're looking for independent measures. They're even setting up separate culture, subcommittees off of the board so that they can have more governance and more insight into the cultures of the companies that they're serving. So vastly under-appreciated overall, Mike.
Siobhan: OK, my turn Kevin, annual performance reviews. Underrated or overrated?
Kevin: Yeah, probably just shouldn't be done. But yeah, overrated. Just even the term annual performance review is not the right way to look at it. We have worked with a lot of companies on performance management overall, many of the organizations you probably read about that have moved from a ratings or god forbid, a ranking system around performance management, to just really solid managerial conversations around day-to-day performance and long-term career goals. I think the the most healthy cultures I see are where you have managers that are very comfortable discussing performance with the people that work for them. I think employees appreciate that they want to know where you know how they're doing from a performance perspective, but they don't want to know it just once a year. They want to know how they're doing on an ongoing basis. And they want to have an ongoing conversation with their manager. And they want to know that their managers invested in developing them. And if it makes sense, moving them throughout the organization. In fact, I've often said talent mobility is one of the most underrated talent development techniques that organizations can utilize. High performing organizations are great at talent mobility, but it's still a small percentage of companies that incentivize managers to move top talent around the company and recognize or reward them for doing that. annual performance reviews. Well, you can't have performance management be the same for every single company out there. I think the more you can move to ongoing performance reviews, the better.
Mike: Alright, we haven't talked too much about your background but you're both a corporate executive as well as an entrepreneur. So talk about being an entrepreneur, is that underrated or overrated?
Kevin: Probably underrated. You know, in a lot of ways, I think America is basically built on entrepreneurs. We're a country that got to where we are because of entrepreneurship. And it always is a little frustrating when I hear certain politicians or people put down entrepreneurs or capitalism, because I really think that that's the basis of who we are in the U.S. But you know, overall, when you look at great businesses, nine times out of 10, those businesses are great because there was an entrepreneur that started that business to begin with and made it great. I think we have to celebrate entrepreneurs and we have to teach it. It's a skill set that I think can be learned. I'm still learning it for sure. So yeah, I'll go with underrated on that one, Mike.
Siobhan: Alright, Kevin. This one is gonna be a tough one. I don't want you to jump, Think about your answer. Underrated or overrated. Steely Dan.
Kevin: Somebody listened to my podcast or read the book. I say Steely Dan is by far underrated. I've always been a Steely Dan fan and for some reason, when I was writing the book, just listened to Steely Dan because it just kind of got me into the rhythm of writing it and soothed my nerves. So I'll go with underrated on that one.
Mike: The sweet sounds of Donald Fagan are playing behind Culture Renovation the book.
Alright, final question for you, Kevin. As we move into this environment, where we're going to be in a distributed remote work environment, I want to try to crystallize this for how you build culture when not everybody's there. Because you actually have a couple stories in the book about how culture is something that you can feel when you get into a place, it's apparent from what you see, and how you see everything and the interactions that happen around you. But how do you actually build a culture when we're not actually seeing people in person? What are some takeaways that you could have for folks who are going to be in that environment for the near future?
Kevin: Well, I think if you look at any of the examples I use in the book, none of those companies saw everybody in person, right? Every big company is distributed and global. Most of the companies that I highlight in the book have employees across a wide geography. And so it shouldn't really be a whole lot different given that many of those organizations during the pandemic are forced to go into a remote working environment. A lot of the concepts are very much the same if you want to change culture.
I think there are some things that organizations are doing successfully today, though, if they weren't a remote, working, friendly company before, there's some things they're doing today to make that a little bit easier for employees. Certainly ongoing listening and just frequent surveying from a sentiment standpoint is something that a lot of organizations are doing. And I think that's healthy just to give the senior team and everybody in the company and understanding of our employees feeling like there's a lot of social activities that organizations are doing remotely today to just to stay in touch and to make sure that people are feeling inclusive. And really, inclusion is just one of those traits that most successful companies do very well. They create an environment that is psychologically safe, that people can speak their minds. That's an inclusive overall environment for people to thrive in.
So I think all of those are aspects of a remote working culture that are healthy. And there's a number of techniques that companies are using to bring out those aspects.
Mike: Alright, Kevin, if people want to learn more about you and the book, where would you recommend they find you?
Kevin: Probably the first place you could go is culturerenovation.com. We've set up a separate website that not only supports the book and talks about some of the concepts in the book, but also offers up some additional resources, some case studies, some tools, and an area where people can share their stories. And like I said earlier, culture change is never done. And frankly, there are other techniques that organizations have used in their successful culture renovation efforts that we didn't put in the book. And we know that because we didn't have room for some of them in the book. And we know that there's some unique things that organizations are doing that work very well. And so we want to hear about those and we've created an area on that site for people to share that. So go to the site, and you'll you'll also find information on where you can buy the book, but I would assume most people on this podcast know where they can buy the book.
Mike: And you can share your thoughts on Steely Dan there as well.Thanks for joining us today, Kevin.
Kevin: Thank you, Mike. Thank you, Siobhan. Appreciate it.
Siobhan: So honestly, Mike, this book couldn't have come at a better time. I'm sure that they conducted some of this research during the beginning of the pandemic but I'm just thinking of all the organizations who were having to rethink their culture during all this. What was the big takeaway for you from this conversation?
Mike: I'm going to go back to the beginning. I mean, just the vocabulary conversation about renovation vs. transformation. At first, I kind of felt like the metaphor didn't really speak to me, but as I really think about it, and as he explained it, this idea that renovating your culture is the way to approach it versus a transformation, is really powerful.
I think we tend to overuse this idea of transformation and it becomes kind of a buzzy term. We're all in the business of transformation. But there's a lot of good things that might get shoved aside if we make that the way we talk about things. So we really better to be careful about the words that we use and renovate rather than transform. What stood out to you, Siobhan?
Siobhan: I think, for me, it was the discussion of how to get employee buy-in and the challenges involved in that and how people can go about identifying those people who are going to be the change champions within the organization and find the people who are going to be the blockers and lift up the people who are going to be able to help the organization move forward.
Mike: Alright, with that I guess that's it for now, Siobhan. We'll talk next time.
Siobhan: From raisins to Steely Dan, I think we covered it all, Mike.
Mike: Right. Take care. Bye.
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