Cultivating Culture
Cultivating Culture

Cultivating Culture

This page is a work in progress, part of a multi-year effort to capture and share learnings, frameworks, tools, and processes to run organizations. See Running Organizations for more.

How to Cultivate Culture

We've covered what culture is and how it comes to be, but we haven't talked about how to intervene and improve culture. Before getting there, let's talk about how to think about culture.

Your Culture As A Garden

The "machine" view of the organization is an outdated 20th-century perspective. Thinking of an organization as a garden or a community is a helpful lens. A garden or community can't be controlled. All we can do is plant seeds, water, monitor, and work with people to improve it over time.

"Treating a business like a machine, and optimizing the parts, is a big mistake because machines don't evolve by themselves yet. Treating a business like one organism and attempting to optimize the whole is also a mistake, because one organism usually cannot transform itself. You must treat your organization like a community. The community may have its purpose and metrics, but so do all its members." - Jurgen Appelo (Source: Managing for Happiness)

Stanley McCrystal explains his changed leadership style as "tending the garden" - an apt metaphor for both shaping culture and managing operations in the 21st century.

"Tending the garden - became my primary responsibility. Without my constantly pruning and shaping our network, the delicate balance of information and empowerment that sustained our operations would atrophy, and our success would wither...I could shape the culture and demand the ongoing conversation that shared consciousness required." - Stanley McCrystal (Source: Team of Teams)

Ways That Culture Is Embedded

How do we shape or "tend the garden"? Here are primary and secondary ways in which leaders "embed" culture in organizations:

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The primary ways to embed culture (Source: Organizational Culture and Leadership):
  • What you pay attention to, measure, and control on a regular basis
  • How you react to critical incidents and organizational crises
  • How you allocate resources
  • Deliberate role modeling, teaching, and coaching
  • How you allocate rewards and status
  • How you recruit, select, promote, and excommunicate
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The secondary ways to embed culture (Source: Organizational Culture and Leadership):
  • Organizational design and structure
  • Organizational systems and procedures
  • Rites and rituals of the organization
  • Design of physical space, facades, and buildings
  • Stories about important events and people
  • Formal statements of organizational philosophy, creeds, and charters

Working The Primary Mechanisms

Make Conscious Behavior Decisions

How leaders behave decides much of the way culture forms. Much of this happens in the moment-to-moment experience, during meetings and daily decisions, and while following key processes and your operating rhythm. "What you do is who you are," as Ben Horowitz says.

"Some of the most important signals of what founders and leaders care about are sent during meetings and in other activities devoted to planning and budgeting, which is one reason why planning and budgeting are such important managerial processes. In questioning subordinates systematically on certain issues, leaders can transmit their own view of how to look at problems." - Edgar H. Schein (Source: Organizational Culture and Leadership)

Leadership Behaviors That Signal

Great leaders signal important cultural behaviors by taking visible actions that show employees how serious they are about specific aspects of their culture.

Larry Page reviewing hiring packets for each candidate as Google scaled was a visible example of Google's stated culture in action. Other behaviors - like giving up the corner office, parking spaces, special equipment, or a Business Class seat - all add up.

"Larry is sent each week's recommended hires...More important than the feedback itself is the message from Larry to the company that hiring is taken seriously at the highest levels, and that we have a duty to continue doing a good job.” - Laszlo Bock (Source: Work Rules!)

In Amazon's early years, Jeff Bezos was famous for personally responding to customer emails.

"The value is not in the actual work output, it’s that it is a visible costly signal of company priorities. The value of the leader’s time is not just writing the code, responding to the email or making an SOP – it is that doing those things and being transparent about them helps to create a culture and set of norms so that other people will do those things." - Taylor Pearson (Source: What Is Company Culture & Why Is Culture Important?)

Don't Waste a Good Crisis

Crises are opportunities to reaffirm or reshape culture. When the risks are significant and emotions run high, deeply-held beliefs and assumptions that may have limited the organization and its people tend to be revealed. Great leaders take advantage of these moments.

Ask The Big Questions

If you had to rebuild everything from the ground up, how would you do it differently? What might a new, brighter future look like? Crises force us out of stasis, and out of the status quo, and often demand that we think creatively to challenge the assumptions that put us into crisis.

Communicate During Crisis

If there's one easy thing Leaders can do to shape culture in a positive direction during a crisis, it's to communicate fully and vulnerably about reality. Whether it's one-way sends, like a Weekly CEO Email, public Slack messages, or a Q&A format in a Town Hall, communicating consistently and openly helps build trust.

Heightened Emotions = Greater Learning

When we act to deal with a crisis, the behavior we exhibit is amplified and leaves more emotional resonance than in periods of peace and calm.

"Crises are especially significant in culture creation and transmission because the heightened emotional involvement during such periods increases the intensity of learning." - Edgar H. Schein (Source: Organizational Culture and Leadership)

Decide Who's On Board

Hiring

Hiring people that substantively add to the operation is key to growing culture. Organizations that plan to grow should have a clear strategy for acquiring talent from the outside, and an aggressive recruiting plan to match.

Always prioritize core values in your hires. Jobs change fast, and skills can always be trained. Values cannot be trained and not hiring for values is disadvantageous for the organization and not fair to those hired.

“If you aren’t having these explicit conversations about what your culture is, the downsides are threefold: You don’t have the right people joining you, and you’re being unfair to those who do join you, in the sense that they end up being surprised by this emergent friction and tension in work styles." - Patrick Collison, CEO of Stripe 

Having a talent pipeline - as Google did with the Stanford engineering department - is a powerful tool for finding talent, and can strengthen an early organization's culture. In my experience, early career hires can create strong emotional ties to one another and loyalty to the organization. They may also be more adaptable to change as you grow.

Remember that a strong culture isn't necessarily a productive culture. At a certain size, you need diversity of experience and thought to improve decision-making and increase innovation.

How Will You Diversify?

"Personal bias" leads hiring managers to hire people who are more like them. Over time, if hiring managers have complete end-to-end control of hires, their teams may be a group of people who think, look, and act just like them.

"It takes almost no time to spot the superstars and to weed out the duds, but the majority of candidates, alas, falls somewhere in between, and that is when biases tend to kick in. If you just pick people who have known characteristics, who already feel familiar, they seem likely to work out. The fact that they sometimes do succeed only makes matters worse, as it reinforces the notion that your process is good enough." (Source: Working Backwards)

Hiring for "cultural contribution" or "cultural addition" is common now. Of course, to know how to "add" to a culture requires that you have a strong enough conception of your culture to know what you're adding to.

"Early on, we may need a handful of colleagues who see the world the same way in order to bring something new and disruptive into existence. But soon after, we'll need to focus on increasing the cognitive and general diversity of the group in order to achieve our full potential. We want our organizations to get more interesting over time." - Aaron Dignan (Source: Brave New Work)

What's missing from the culture? What other sorts of life experiences and perspectives could be beneficial to the organization? Start there.

How Is Your Management Bench Built?

Many organizations focus on who and how they'll hire, but less focus on how promotions will play out. As they grow, the need for management and leadership grows and the organization has to make a choice between hiring from the outside or developing internally. Building an internal promotion culture can be motivating to staff, and can ensure that each hire is aligned with the culture you want to create.

Moving individuals to management is a critical decision due to the leverage of management on the organization. Secondarily, hiring from within is also a form of Reward.

Find An Early People Leader

Consider an early People leader hire. Not an HR administrator or recruiter (though both of those skillsets are great), but a person who brings dedicated focus to building People systems. A People leader who can think through how to help employees stay physically healthy, mentally healthy, and emotionally healthy, is a tremendous foundation for company culture.

"You need a strategic partner to help you craft your organization and be a co-steward of your culture...For most companies, hiring a great head of HR is doable at about 50 people; by 100, you're probably too late." - Matt Blumberg (Source: Startup CEO)

Rewards & Resource Allocation

Don't Overemphasize Rewards

Rewards are as powerful as they are dangerous. Too much focus on rewards will lead to an "incentive-driven" culture where management schemes to manipulate people's behavior and people focus on rewards rather than mission. Harry Levinson wrote of this issue in HBR in 1973, using the analogy of the jackass, the animal that best responds to "carrots and sticks."

"Most of the contemporary psychological conceptions of motivation take a reward-punishment psychology for granted; they advocate trust and openness among employees and managers, but at the same time they acknowledge that the more powerful have a natural right to manipulate the less powerful." - Harry Levinson (Source: Asinine Attitudes Toward Motivation)

Levinson was anti-carrot and stick, and cautioned us against using rewards to try to shape behavior. Great organizations treat their people like adults by making expectations clear and extending trust to them.

"Great teams are not created with incentives, procedures, and perks. They are created by hiring talented people who are adults and want nothing more than to tackle a challenge, and then communicating to them, clearly and continuously, about what the challenge is." - Patty McCord (Source: Powerful)

All rewards, including compensation, bonuses, and promotions need to be highly principled (i.e. operating principles), because every choice you make in these areas will be seen, and will be used to judge the organization's management.

Compensation

Pay and culture are inextricable. How you pay people is a creator and reinforcer of the culture, and unlike other rewards, you can't dodge pay - everyone gets paid.

How do you do determine salary? Do you use salary bands? Do you use a base salary along with bonuses or commissions? Is equity involved? Who gets bonuses? Who gets commissions? How are raises determined? If you don't have strong operating principles for compensation, you're subject to politicking and eventually a toxic culture.

"The only way to prevent politics is to never allow lobbying to be successful, and the only way to do this is to have a written policy...particularly around compensation, raises, and promotions." - Matt Mochary (Source: The Great CEO Within)

Compensation is an ongoing issue because market rates for job roles are always changing. If you don't keep up with leveling, you'll likely end up with high pay variance for the same job roles. This is can be unhealthy for culture, and a lawsuit waiting to happen.

There are essentially three elements to consider when designing compensation to fit culture: Hierarchical Pay Structures, Egalitarian Pay Structures, and Bonuses.

  • Hierarchical pay structures have steep pay variance and big raises that place emphasis on individual contributions and reward high performance or good behavior.
  • Egalitarian pay structures have flatter pay grades and use "broad banding" to attempt to emphasize team and community and limit jealousy and frustration between people.
  • Bonuses are mostly "pay for performance" schemes to reward high performance or good behavior. They can be company-wide, or for departments, teams, or individuals, but they are mostly short-term rewards.

This study suggests that the best pay structures for:

  • Clan cultures is an egalitarian pay distribution and infrequent use of bonuses.
  • "In an egalitarian structure the employees are relatively at the same level of compensation avoiding perceptions of injustice and inequity that might undermine collaboration. Moreover, PFP [bonuses] might not be appropriate for this culture as a compensation strategy because of the long-term perspective, the interest in personnel development and the risk adversity of the Clan organization are incompatible with the short-term, risk rewarding focus of a PFP incentive strategy."
  • Adhocracy cultures is an egalitarian pay distribution and frequent bonuses based on creativity and innovation.
  • "Collaboration requires that employees perceive they are in a roughly equivalent stature with those they collaborate with, and employees should feel that they are of equal stature to their co-workers... This will decrease employee competitiveness and encourage cooperation...Since Adhocracy is also oriented to be innovative, rewarding individuals or teams for risk-taking in creativity encourages innovation that drives the success of the firm."
  • Hierarchy cultures is hierarchical pay distribution and infrequent bonuses. Since the structure is built to reward process-following, collaboration isn't as critical and risk-taking is discouraged.
  • "With no great need for collaboration, it is much less critical for individuals to feel as though they have equity with coworkers. Due to the necessity to follow procedure in the hierarchy culture, risk-taking is discouraged, therefore we further suggest that organizations with Hierarchy culture limit the use of PFP"
  • Market cultures is hierarchical pay distribution and frequent bonuses. With less collaboration, pay equality is less important. With more short-term financial focus, management works incentives to drive outcomes.
  • "Due to the short-term performance orientation of the market culture, and considering that organizational members are focused tightly on performance objectives we propose that PFP compensation strategies might be suitable for Market cultures in order to incentivize and reward employees who reach those short-term performance objectives."

Transparent pay can cause more egalitarian pay distributions as managers contend with individual cases. One study shows that it can reduce the gender pay gap but weaken performance. Here are Buffer's fully transparent salaries.

Promotions

How and when are people promoted? Promotions are an important area because they often combine raises, levels, and hierarchical changes. A culture that promotes often signals that learning and development are important, and can also retain employees longer.

A Hierarchical organization has more room for promotions whereas Adhocratic and Clan cultures have fewer promotion opportunities.

One benefit of internal promotions is that generally, it will lead to higher employee retention, which over time should strengthen culture (rather than evolve it) and energize people.

"A company with frequent promotions also has lots of advantages in managing employees. You hold onto great employees for much longer periods of time, and they’ll be much more engaged while they’re with you. It energizes people to see growth for themselves and for the people around them, and it creates a positive-sum mindset: as the company grows, everyone grows." - Jack Altman (Source: Promotion Cultures)

Promoting internally from an early culture could lead to less cognitive diversity in the organization as you hire people who look, talk and act like you, and then promote them into higher-leverage roles where they make an impact at a greater scale.

Budgets

The allocation of budgets is a complicated decision area that says a lot about who you are and how you want to operate. How are financial decisions made in the organization? Does Finance operate in a silo? Do financial decisions get made on annual basis or more frequently? How exactly are decisions made about budgets?

Budgets are control mechanisms. The more budget process and procedures we put in place, the less likely we are to overspend and experience a catastrophic failure. On the other hand, that control limits our ability to change as the situation changes. If you didn't budget enough for office supplies to meet demand this year but need to wait for next year to buy needed supplies, how does that reflect or clash with the culture you're working to create?

The budgeting process can keep managers focused internally instead of thinking big and look for opportunities. This may be fine for internally-focused organizations like Hierarchical cultures and Clan cultures, but misaligned for Adhocracy and Market cultures.

"Budgeting is one of those things that can make you keep your head down when you actually need to keep your head up to see what’s coming at you." (Source: Simple Numbers, Straight Talk, Big Profits!)

Many organizations have shifted from annual budgeting to quarterly budgeting, as this Bain article notes. Quarterly budgeting makes a cultural statement about strategic flexibility and agility.

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Netflix Quarterly Budgeting "Whatever our projections were, we knew they would be wrong in six months, if not three. So we just stopped doing annual planning. All the time we saved gave us more time to do quarterly planning, and then we went to rolling three-quarter budgets, because that was as far out as we thought we could ostensibly predict." - Patty McCord (Source: Powerful)

Celebration & Recognition

Celebration and recognition is often the cheapest and easiest area of Reward. Compete cultures celebrate and recognize individual achievement and short-term financial wins. Control cultures celebrate process wins and efficiency gains, often using "employee of the month," types of awards. Collaborate and Create cultures celebrate team achievement and effective teamwork, and Create cultures often celebrate project completion and wins in the market.

Recognition is about spotting culture-building behavior and calling it out. Control and Compete cultures define what they want to see, build a process or system for monitoring that behavior, and then define how they reward it when they see it.

Create and Collaborate cultures benefit from going a step further, implementing peer recognition to scale the effort and increase the sense of community in the organization. Peer recognition can help to flatten hierarchy and take pressure off of managers, who often feel the heat of spreading recognition around equally and not missing anyone.

Without celebration, it's hard for people to know if your goals and your BHAG are actually meaningful. Celebration is hard for a lot of companies and can come off hollow to a lot of employees. Celebration is a way to reinforce what's stated in your formal foundational statements (Core Values, etc.), and most importantly, it's a positive way of doing so, whereas other methods rely on negative reinforcement and policing.

"When you celebrate achievement, you confirm that your goals are important enough to be recognized. If you don’t celebrate successes, the goals lose their meaning and significance. And achievements can even become counterproductive in the absence of celebration." (Source: CEO Tools 2.0)

Celebrate the small stuff. Celebrate milestones along the way. We're driven to see progress toward our goals.

"Too many companies approach celebration as all or nothing. They wait until they achieve the year-end numbers or reach the big, audacious goal before breaking out the balloons and banners. If you wait to reach the finish line before you acknowledge and reward the efforts of your people, you’ll lose a lot of employee energy along the way." (Source: CEO Tools 2.0)

Collaborate cultures don't need to just celebrate achievement. These family-like cultures also go out of their way to appreciate people. Appreciation recognizes positive human traits instead of achievements alone. You don't need to achieve to appreciate.

"Shared celebrations over a recent marriage engagement, a major birthday, or a recent promotion can magnify positive emotions and strengthen the fabric of a groups bond." - Ron Friedman (Source: The Best Place to Work)

Coaching, Training & Mentorship

Coaching and mentorship is an important culture-builder because it helps people grow as individuals and it improves organizational performance. Mentors learn from teaching and gain the psychological benefit of having given back. Mentees learn and grow and develop bonds with their peers. Importantly for Culture, mentors and coaches pass along Core Values and Operating Principles through their efforts.

Coaching and mentorship should be a core function of managers, but also should be done among peers, independent of your hierarchy.

What Does Great Mentorship Look Like?

Mentoring is listening to others and giving answers based on one's own personal experience. The best way to mentor is to give people the appropriate principles necessary to solve their own problems. This allows them to think for themselves, retain responsibility for their own solutions, and solve similar future problems on their own.

Dee Ann Turner breaks down what makes a great mentor in her book Bet On Talent:

1. Mentors are teachers. Great teachers don't tell you what to do. They teach principles and then demonstrate what they teach...Mentors teach principles and then explain why they are important.
2. Mentors are role models. Leaders who are consistent day in and day out do not have to say much, because they demonstrate expected behaviors.
3. Mentors hold mentees accountable...Be a truth-teller, as truth is usually far more valuable than accolades. Make compliments well-earned and genuine..
4. Mentors encourage. Encouragement breathes life into others, and it is a very important role of a mentor. Encouragement can come in the form of both words and actions.

Mentorship should be done by managers, but I've found great value in assigning peer mentorship relationships and rotating them often. A person who's one-or-two steps ahead of us in terms of skill, or even just organizational insider knowledge, can sometimes be more effective than a manager.

How Does Coaching Work?

Coaching teaches people how to improve their own performance. The most effective way to coach is by asking questions, NOT giving answers. Coaching holds up a mirror to people.

"As a coach, I am not listening for the content of what is being said as much as I am listening to the way they are thinking, including how their attention is focused and how they define the key elements of the situation". - W. Timothy Gallwey (Source: The Inner Game of Work)

Coaching builds culture because it connects people in a respectful, responsibility-increasing manner. It can be done by nearly anyone who's willing to be present, to truly listen, and to be patient with others.

"Researchers suggest that both the person being coached and the coach themselves may experience positive psycho-physiological changes from coaching with compassion. And these changes may mitigate psychological and physiological effects from chronic power stress." - Rebecca Newton (Source: Rediscover Joy at Work)

The GROW Model is my favorite model for coaching, as it's simple as hell and relatively easy to train. Armed with the GROW Model, theoretically, anyone can coach, and anyone can coach themselves. For more on the GROW Model, see Designing Management.

What's the Best Way to Train?

Training is teaching people how to do the work. The best way to think about training seems to be the 70/20/10 model.

70/20/10 says that 70% of learning happens during the course of daily work - through problem-solving, tasks, reviewing work, experimenting, and reflecting. Twenty percent comes from working with others - through collaboration, giving and receiving feedback, and after-action reviews. The last 10% comes from formal learning like courses, workshops, and seminars. The best resource I've come across for designing training is 70/20/10 towards 100% Performance.

Instead of thinking of training as trainings, we need to think holistically about how people will learn by getting hands-on with work, how they'll lean on managers and peers for closing the feedback loop, and then how they'll supplement with courses, books, and articles.

Secondary Mechanisms

Org Design, Structure & Systems

This section will focus on the interplay between culture and organizational design. We'll cover organizational design in greater depth in the next section.

Organizational culture informs and impacts organizational design, and vice-versa. Much like with strategy, a "fit" between the culture and the design is necessary. While culture can be shifted and changed, it's ultimately out of our control. Organizational design is within our control.

"Organizational culture is an intrinsic factor of organizational behaviour, inasmuch as it directs the way people behave in an organization by operating from within and by determining assumptions, values, norms, and attitudes according to which organization members guide themselves." -Nebojša Janićijević (Source: The Mutual Impact of Organizational Culture and Structure)

The dominant core values, beliefs, and assumptions, whether conscious or unconscious are the inputs to the organization's design.

"The culture creates a frame of reference in which the organization management’s considerations and reasoning circulate in the process of decision-making concerning the organizational structure model." - Nebojša Janićijević (Source: The Mutual Impact of Organizational Culture and Structure)

Designing the organization to fit the culture is the aim of "institutionalizing" the culture. If the dominant culture and the organizational design fit, then the design is legitimized. If there is no fit, people experience cognitive dissonance, and either the culture or the organizational design needs to change.

The design ultimately impacts the culture, too. One way that the cognitive dissonance of a poor fit is resolved, is through a change in culture. Changing the culture can legitimize the design of the organization.

Formal Statements: Core Values, Principles, Procedures

Changing your formal statements is the easiest change you can make and can set in motion the beginning of a change in culture.

"The first step in a major transformation is to alter the norms and values. After the culture has been shifted, the rest of the change effort becomes more feasible and easier to put into effect." - John P. Kotter (Source: Leading Change)

If nothing is ever written in stone, and your organization's "rules" are viewed as an open conversation, you can keep them front-and-center for all to challenge and improve over time, especially as your organization and culture evolve in size and scope.

"The key to a great culture is creating and fostering a never-ending conversation about the 'rules of the game.' The rules define the boundaries or guardrails so that everyone knows exactly how to act, how to communicate, and how to treat each other." - Keith J. Cunningham (Source: The Road Less Stupid)

Whatever your stated core values and/or principles, having ways to reinforce them as part of your ritual stack and operating rhythm is critical.

Audit your "rules" - you should have just enough to create helpful boundaries for people, but not so much that people's creativity is stifled. As you grow and mature, rules tend to stack up as your management team sees and solves issues.

Selectively removing some rules is critical for allowing the right people, in the right situations, to exercise the most amount of judgment as is responsible.

"Rules can be useful to set the boundaries to complete tasks and projects and provide guidelines. Yet having too many rules greatly reduces creativity, innovation, morale, and motivation and eventually kills productivity. When rules are set forth and enforced, employees begin to think their employer does not believe they have the ability to use their own judgment and reason. Team members become less motivated to do a job because they believe their boss expects them to make the wrong choice or decision when faced with an issue or a problem." - Dee Ann Turner (Source: Bet on Talent)

Rites and Rituals

What Are Rites and Rituals?

Rites and Rituals are repetitive, consistent public demonstrations that express an organization's Core Values and Operating Principles. They're rich in symbolism and can be formal.

"Ritual action....is a form of social action in which a group’s values and identity are publicly demonstrated or enacted in a stylized manner, within the context of a specific occasion or event." (Trice and Beyer 1984, 1988, 1993) (Source: Rituals in Organizations)

Rituals can serve many purposes, including promoting stability, promoting change, helping people transition, and helping build community. Some of the most common rites and rituals in organizations are meant to bond individuals into the social group.

"Through ritual, individuals can momentarily forego social differences and reaffirm their sense of communitas, or basic, shared social membership." - Gazi Islamro (Source: Rituals in Organizations)

Rituals can be imposed by management or created bottom-up, and most organizations have a combination of organization-wide Rituals and department-level Rituals.

Rituals have both a literal and symbolic purpose. For example:

"A weekly reporting meeting of department heads and administrators has a clear manifest purpose: to communicate to all mid-level and upper administrators what is happening in each department. While it might seem inefficient or boring, the meeting’s purpose should be clear to any observer; however, the meeting’s latent purpose might be a rite of renewal where the director attempts to correct, or give the appearance of correcting, the problem of poor communication." - Jason Martin (Source: That's How We Do Things Around Here)

Organizational rituals build culture and enhance the meaning of work.

Types of Rites and Rituals

There are three main types of Rites and Rituals we see in organizations. "Rites of Enhancement," "Rites of Renewal," and "Rites of Integration."

Enhancement means celebrating people. Enhancement rituals hold up individuals as the modelers of appropriate behavior in an organization. These celebrations celebrate individuals but increase the status of the organization overall.

"Rites of enhancement are elaborate ceremonials given to those members of an organization who perform exceptionally well or who personify company values or attitudes" - Gazi Islamro (Source: Rituals in Organizations)
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NextJump's "Avengers Award" given to the "top servant leader," on annual basis. Their smaller weekly Coronitas ritual, in which people call out others for helping them, combines with a monthly "Top 10" celebration of people who have most helped others succeed in the month. The results of those smaller rituals add up to the annual Avenger's Award. See more here.

Renewal means upholding Core Values & Operating Principles. Renewal rituals serve to uphold and strengthen the culture, rather than change it. Because these rituals reinforce Values and Principles, they are very specific to an organization's culture, and often very creative and symbolic in execution.

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Amazon's famed "Empty Chair" ritual at meetings is a Renewal Ritual. The chair was there to remind people that "the customer always has a seat at the Amazon table."
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Another customer-centric Principle-reinforcing Ritual is OXO's "glove wall," which is a collection of lost gloves that OXO employees have found. The wall serves as a reminder "of the different hands our products need to comfortably fit."

Integration is about building community. Most organizations have some sort of community-building ritual - a common example is holiday parties. Many Integration rituals combine Renewal and Enhancement rituals.

"Rites of integration attempt to bring different groups within the organization together that may not normally interact." Gazi Islamro (Source: Rituals in Organizations)
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AirBnB's "Human Tunnel" is a literal rite of passage for new employees, formally integrating people into the community.
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HubSpot changed people's seats every 6-8 months, even as they eclipsed 700 employees, in their effort to build community and get people working well together.

Top-Down or Bottom-Up?

Rituals are generally designed top-down, but they also emerge bottom-up. Most organizations aim for a balance of both.

Subcultures develop their own Rites and Rituals, and not all of them are ideal for building a healthy culture. Subgroups sometimes develop rituals that come at the expense of other subgroups - through mocking, stereotyping, teasing, and nicknaming. These behaviors aren't necessarily dangerous, as long as they affirm the legitimacy of the overall organization's culture. For example, a nickname given within an organization only exists in that organization, which strengthens the overall cultural affiliation within the organization, even if it appears to be negative on the surface.

"Dissenting voices do not undermine the effectiveness of rites of renewal as long as they affirm underlying affiliation or legitimation of the group." - Gazi Islamro (Source: Rituals in Organizations)

Designing Rituals

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Design Rituals
  • What do you want to solve for? Building community (Integration)? Reinforcing your Core Values (Renewal)? Celebrating model performers? (Enhancement).
  • If you're looking to celebrate model behavior, then "awards" is the standard option. You don't have to wait for the end of the quarter to hold up great behavior - praise and appreciation can be delivered daily and weekly.
  • If you're looking to build community, then events, meetings, happy hours lunch events like lunch-and-learns are the default options. These rituals can also be small, everyday actions with symbolic meaning - an automated Slack bot that connects people across functions to increase conversation is one example.
  • If you want to reinforce your Core Values, you can do this through highly symbolic rituals that integrate some element of surprise, fun, or other positive emotions, but that doesn't mean you can't use very straightforward means. A typical salesperson "After-Action Review" (reviewing your last sales call with a sales manager or peer) can be used to reinforce your culture of Excellence or Personal Development.

Storytelling

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"Morgan Freeman can narrate a grocery list and bring people to tears, while an inarticulate scientist might cure disease and go unnoticed." - Morgan Housel (Source: How People Think)

Stories are compelling and memorable, and build culture by supplying the lore of an organization. Stories are a strong tool for reinforcing core values and operating principles. While we often focus on the analytical aspects of running an organization, storytelling is an emotional tool.

Story Frameworks

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SCQA Storytelling Framework
  1. Situation - What was the situation?
  2. Challenge - What was the specific challenge?
  3. Action - What did the person do to reinforce the culture?
  4. Result - What was the impact? What was the Core Value/Principle that was reinforced?

The Hero's Journey is another common framework for crafting stories.

Kurt Vonnegut's amazing "shapes of stories" storytelling lecture is a favorite of mine.

Leadership Stories

Any time we deliver an important message, we should always try to accompany the message with a story or anecdote that makes the message more visceral, transmissible, and memorable.

"A simple, clear message, repeated often and illustrated with memorable stories, is the best way for a new CEO to master the communication challenges of the job." (Source: Seven Surprises for New CEOs)

Leaders should both gather and spread stories that support and reinforce the Core Values and Operating Principles. The prep for your Annual and Quarterly Reviews are good times to collect stories, and the Reviews themselves are important opportunities to spread the stories. Any time you give out awards is an opportunity for a culture-building story.

Stories can also be transmitted through one-on-one meetings and mentorship sessions with managers. Of course, many can be written and/or designed and shared on social media, too.

Organizational Lore

Every organization has founding stories, stories of the first sale, the first customer, the first flagship client, the first failed product, and more. Consciously documenting these early stories and building the organization's narrative as it matures can be incredibly powerful.

There are also stories to be told about the language people use in the organization - the phrases, terminology, and traditions.

These stories are perfect for Employee Onboarding as a part of a Culture Deck.

Employee-Generated Stories

The highest volume and best stories won't come from management but from employees. You have customer success stories, process wins, departmental wins, employee development wins, and more. Spreading those that represent the organization's core values is critical.

We can create rituals around storytelling by opening meetings or using survey/chat prompts saying, “Who has a story about…?”

Short anecdotes can be used to support larger themes in the organization - whether it's an "Annual Theme," a quarterly OKR/Rock or otherwise.

Collect stories from staff within the current quarter or month about a time they witnessed a specific core value or operating principle at work - the best of these can eventually be made into visuals and videos and part of your training and onboarding

How to Change A Culture

In An Unproductive Culture, Know...

People Will Resist And Fight Against Change

Humans don't like change and tend to fight it, even if we believe it will ultimately be positive for the organization. Change causes us to go through "transitions," and transitions are always bumpy. Along the way, there will be skeptics and people who say "I told you so."

The "3rd Law of Transitions" says that:

"In any significant transition, the thing that the organization needs to let go of is the very thing that got it this far." - William Bridges (Source: Managing Transitions).

In transition, we need to leave behind the past and find a way to be productive in a state of uncertainty.

The "4th Law of Transitions" says that when you're going through a difficult time in your organization, that:

"The terrible morale, the intragroup conflicts, or the sudden drop in productivity that you're trying to deal with are just symptoms of that transition and the toll it is taking on people." - William Bridges (Source: Managing Transitions)

Change Takes Time

Cultural change happens after people's behaviors change and that behavior is reinforced by positive outcomes. Change in behavior takes time and doesn't stick for everyone. Sometimes big cultural changes require putting new people in key positions instead of waiting for everyone to adapt.

"Culture changes only after you have successfully altered people's actions, after the new behavior produces some group benefit for a period of time, and after people see the connection between the new actions and the performance improvement." - John P. Kotter (Source: Leading Change)

We need to stick it out and stay disciplined while the organization goes through that change because there is nothing more important than making an organization healthy. All of the strategic, creative, and innovation efforts add up to nothing if the organizational culture is broken. Improving culture is about discipline, patience, and courage.

What You Can Do

Study, Listen, Watch

You can't control culture. You can't change it easily. You can't be too confident about how a single change will be received. Before you dive into changing culture, make sure you have a strong understanding of how the informal organization works, how power plays out, and who holds it. There are potential threats at every turn.

Threats you may encounter (from The CEO Next Door):

A critical gap between the board's expectations and the reality inside the business
A hidden financial or operational bomb that's now in your lap; e.g., loss of a major customer, cost overruns on a large project, IT implementation problems
A sacred cow or cultural blind spot that has the potential to stymie exactly the changes needed to grow the business.
Signs coming from a level or two down that one of your critical people isn’t up to his or her job or is on the way out

Build Relationships With Those Who Want Change

Make people feel valued. In an unproductive culture, people feel that their work doesn't matter and that no one cares about them. Finding ways to get managers to show care for individuals is just plain good business, but it's also a key starting point for turning around a toxic culture.

"Tell people they're valued. The language system of Stage Two nets out to 'I'm not valued.' As a result, people feel disconnected and disengaged, and their culture acts as a support group for others who are disengaged, as well...Bosses who know the names and ages of employees' children, their hobbies and interests, do better than those who offer programs such as "employee of the month." (Source: Tribal Leadership)

Don't try to fix things for people. In unproductive cultures, there's too much cynicism, too many problems, and too much that people aren't taking responsibility for. You can't own full responsibility for the situation by trying to solve everyone's problems. Work one-on-one with people using a coaching and mentoring style (see: Designing Management).

"There's standard advice in management: if you take people's concerns seriously, they will feel empowered...try working one-on-one with those who want things to be different. Upgrade the culture, and people will take care of their own issues." (Source: Tribal Leadership)

Focus on the people who want the culture to change and are motivated to help. Don't worry about the rest. Focus on the individuals who crave change.

Leverage Cultural Strengths

Every culture, even toxic ones, has strengths and weaknesses. Identify the strengths and draw on them rather than solely fighting the weaknesses. Don't try to overcome the constraining behaviors or try to police behavior more forcefully.

"In many transformation efforts, the core of the old culture is not incompatible with the new vision, although some specific norms will be. In that case, the challenge is to graft the new practices onto the old roots while killing off the inconsistent pieces." - John P. Kotter (Source: Leading Change)

Change Behavior At The Management Level

Get managers and integrators to build bridges across departments. Cut through the silos. Silos are good for organizing specialization, but in an unproductive organization, they need to be combatted by leaders who can get people to communicate across them.

"Who is building the bridges between previously disparate, perhaps even adversarial, groups? Who is creating channels of communication and connectedness? Who is doing the hard daily work of building trust? Who promotes everyday civilities and politeness? Who sees the isolated individuals and includes them? Who helps the organization see the value of diversity and the pathology of exclusivity and harassment? Who creates community at work?” - Peter Scholtes (Source: The Leader's Handbook)

Cut the announcements and memos and best intentions and get management to start taking action. Figure out what the key activities are, track those activities, and hold one another accountable for those actions.

Name An External Threat or Enemy

Naming an external threat turns competition outward instead of inward. In unhealthy cultures, people are either not competing at all or they're competing against one another. Getting people to play together, to compete outwardly against a common enemy, is a positive shift.

Craft An "Apology" Speech

If you're going to embark on a change project, you need to discuss the project and discuss the change. As a leader, you also need to take responsibility for the circumstances the organization has found itself in.

Keith Cunningham's CEO "apology speech" from his book The Road Less Stupid is a great example of leadership responsibility. This speech addresses some of the common reasons why leaders let their behavior slip and therefore their culture slip.

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“I owe you an apology. I did not do my job. I have allowed my lack of courage and desire to keep the peace to get in the way of being a leader. I tolerated the status quo and mediocrity because I didn't want to have the hard conversations. I mistakenly believed it was more important to keep the peace than to have the courage to lead. I admire and respect you, but I have let my admiration for you cloud my judgment and my willingness to say what needs to be said. Candidly, I have probably functioned in a friend and peer role and not in an Owner and leader role. I elevated being liked over being successful. I have been more in love with the tranquility than I have with our outcomes. One of the transitions all successful businesses must navigate us from mom-and-pop free-for-all (let’s all pitch in and get it done) to a more professional, disciplined management kind of structure. I made the mistake of giving people big titles and extensive latitude in the erroneous belief that this would produce an outcome-driven, results-oriented organization in which people were accountable for results. I was wrong. What I need to do is what every successful organization in the history of mankind has done, and that is to transition from being a company of ideas, fire drills, drama, and fuzziness to a company of outcomes, standards, accountability, and results.” (Source: The Road Less Stupid)

Be Willing to Coerce

We occasionally need to be pushed. Your longest-tenured and most loyal employees might be the ones who fight change the most. Increase the pressure and focus on good cultural behaviors and take advantage of social pressure and peer accountability to turn a situation around.

"Those who were most at home with the necessary activities and arrangements of one phase are the ones who are the most likely to experience the subsequent phase as a severe personal setback. They will talk about it as a 'strategic mistake,' as 'dumb,' 'unnecessary,' and 'too expensive.' They will try to debate it on any other terms they can think of, but what they are really saying is that the transition is forcing them to let go of what they find most meaningful about the undertaking." - William Bridges (Source: Managing Transitions)

Culture Management Tools

This is a short list of interesting solutions and tools I've collected to improve and reinforce culture.

Culture Clubs

A strictly non-management, committee-based, egalitarian structure where people can lead, and allocate resources to strengthen the best parts of culture.

"They have modest budgets (typically $1,000 or $2,000 per year) and their brief is to nudge the local office cultures along, staying connected to the rest of Google and encouraging both play and honest discussion. There is no application to be named the leader of a Culture Club. You become one simply by acting like one: taking charge of local office events, being vocal, and - importantly - emerging as a leader to whom others look for advice on what is ‘Googley’." - Laszlo Bock (Source: Work Rules!)

Hiring With Bar Raiser

Amazon's Bar Raiser is covered in-depth in Working Backwards.

"The Bar Raiser is involved in every interview loop, and ensures the process is followed and bad hiring decisions are avoided. They are also there to set a good example for other interviewers. In addition to conducting one of the interviews, the Bar Raiser coaches others on interviewing techniques, asks probing questions in the debrief and determines whether the candidate meets or exceeds the hiring bar set by the company... Bar Raisers are trained to become experts in every aspect of the interviewing process. There is a group of senior Bar Raisers that manages the program, known as Bar Raiser Core, composed mostly of VPs and directors."

The Bar Raiser was involved in these 8 steps: Job Description, Résumé Review, Phone Screen, In-House Interview, Written Feedback, Debrief/Hiring Meeting, Reference Check, Offer Through Onboarding (Source: Working Backwards).

Coaching: Next Jump's FLO + SW

FLO (Follower-Leader Organization) and SW (Situational Workshop) is covered in-depth in An Everyone Culture.

The FLO structure is built to enable a coaching process that uses captains, coaches, right hands and left hands to scale coaching to a large organization.

"At the heart of FLO’s design is the role of the coach, which is filled by the person who most recently captained the same initiative. Her job, above all else, is to coach the captain in leadership and provide feedback that will help the captain develop his backhand."
"The right hand is the team member who works closely with the captain, knowing that she will someday soon take over as the next captain as the roles rotate. Finally, the left hand is another team member who can contribute to the success of the initiative and is next in line to succeed the right hand."
"Coaches, before rotating off an initiative entirely, develop another captain into a coach and must leave the program itself better off than when they started."

SW, the Situational Workshop is a one-hour five-person meeting every week that is used for group coaching.

"At this weekly workshop, each of the four of you describe some challenge you’ve met in the week and what you’ve done to meet it — or not. You might not be sure if how you handled the situation was optimal or not — SW is a reflective exercise. The mentor-coach is there to encourage you to reach a higher level of self-awareness, so that you might identify new options for responding to similar future challenges and so avoid reacting in the same old way."