Why culture is a leadership execution problem
Culture has increasingly become a buzzword used by companies to establish an external brand that attracts employees. But what exactly is culture?
Culture isn't what you say you are but what you do. It’s the everyday behavior demonstrated by employees and leaders at the company. These everyday behaviors are often informed by the values the company holds, whether those values are intentional or unspoken.
For example, if a culture prides itself on the value of transparency, leadership might demonstrate behaviors such as consistent and clear communication from the C-Suite with direct access to ask questions through Ask-Me-Anything sessions and/or anonymous forums. If the transparency value is upheld, these forums should see healthy engagement from employees since they have the psychological safety to be transparent in return.
Culture is modeled at the top, but culture today often falls on HR Teams to understand, improve, and adapt. I’ve been an employee, manager, executive, and in an HR-adjacent function - when transitioning into HR I immediately realized how little power I had to drive change, yet, prior to being in HR, I, also, thought everything was an HR problem.
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Employees lack clarity on how to progress in their careers = it’s an HR problem.
Managers don’t get enough training budget to upskill their teams = it’s an HR problem.
The C-Suite isn’t happy with the slow progress on hiring historically marginalized groups despite the increased investment = it’s an HR problem.
The employee engagement tool demonstrates employees feel connected to the company mission = it’s an HR problem.
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At my prior company, one of our values was our commitment to helping people grow. Yet, we notoriously lacked structure that provided employees clarity about what was expected of them and provided managers with a systemic approach to career progression.
The usual flow at our company looked like this as a result:
There’s a disconnect between the assumption of what HR owns vs. what they have the authority to do. At most companies, HR influences change but they don’t have direct authority over the people that are required to adapt how they work. Changes proposed by HR, such as the frequent career conversations in the above example, require leadership to not only sign up for it but hold themselves and leaders below them accountable. Simply said, they lead by example by modeling the behavior. Culture, therefore, is an operational challenge that starts at the top.
But, how culture works today is by design…
Today, unless a culture change is made a top priority by the CEO, translated into, or tied to, values, and built into how every leader at the organization operates - change either happens extremely slowly micro-culture by micro-culture, or not at all.
How culture is designed today generally results in…
Burnt-out HR leaders
Inefficient middle managers
Disconnected executives
Frustrated employees
The cost of the above is significant. Bad culture is 10x the predictor of attrition than compensation and already cost the US economy $50B annually before the pandemic. We know change will continue to happen quickly, and ask a lot of companies to respond. Ripple effects of layoffs, multi-generational teams, hybrid work, looming workforce shortages, the population becoming increasingly diverse, and the list goes on.
At this point, CEOs are aware that culture is critical to not only attract employees but to retain them and are investing more than ever in both tools and consulting (~$2.5M annually per company) to make informed decisions on culture. Yet, all of those tools are focused on, and built for, HR. Having been in an HR function - I’ll tell you that sometimes it’s like shouting very obvious problems into a void. Everyone might agree that the problem exists, but no one feels accountable to address it. Imagine doing all the work of implementing a framework you know will mitigate a problem employees flagged, managers won’t adopt it, the C-Suite questions the value of your work, and employee frustrations with the lack of progress are pointed at you. In a way, HR is the scapegoat. It’s no surprise that HR leaders burn out at a significantly higher rate than other functions as a result.
When you find yourself questioning the value and impact of your culture and HR efforts, I challenge you to ask yourself a few questions:
Do you think how your company culture is operating today is working?
Is leadership at your company accountable for culture?
Is HR perceived as strategic and empowered to drive change?
If the answer to the above is no, do you think you will see a good return on investment in people and culture? Could culture be so powerful that it springboards your company to lead your industry, or could a competitor’s culture be so powerful that it enables them to leap ahead?
Take the time to sit down with someone in your HR Team and ask them about the last time they implemented, or tried to implement, a change in how leaders operate. Understand what steps they took, and where they got stuck, and ideate on opportunities to improve the operational model going forward - then commit to doing the work alongside them.