Corporate Culture

The time is ripe. There has hardly been a time when companies have faced such major challenges as they do today. It is not just the challenge posed by Covid-19 and the continuing growth of global competition, it is above all the challenges posed by digitalization, which is still accelerating. Most companies are being forced to radically rethink. They not only have to change their processes and question their business models, but above all develop new ways of working. This requires cultural change, otherwise it won't work.

To the top management of a company, i.e. to board members and senior executives who have the task and also the scope to shape the culture of the company or a business unit for the future. For this target group, I wanted to provide an overview of the now extensive literature on cultural change. Above all, however, I wanted to provide a "guideline," similar to my Leadership Change book, on how to approach culture change in a company if you want to do it right.

I am always asked this question. Culture, as almost all experts now agree, is nothing more or less than the sum of the mostly unspoken basic convictions and self-understandings of an organization, or more generally, of a group of people. They are reflected in habits, i.e. in behavioral procedures and processes, in do's and don'ts, in what one may and may not do. But they are usually also reflected in external aspects such as the design of rooms, the architecture, the location of a company and much more.

For example, if a company is convinced that customer service is the key secret to success, then whether you like it or not, that will be reflected in the stories you tell yourself about customers, the place you give customers in your processes, or how you handle complaints, and much more.

All of this together is the culture of the company and when you talk about culture change, you mean exactly this change in fundamental attitudes and beliefs. So if, for example, you want to turn a strongly hierarchical organization into a flat team-oriented organization, or a technology-loving company into a customer-oriented one, then you are talking about cultural change.

Culture almost always changes, but usually slowly. Of course, we have changed in many areas of life in recent years as a result of digitization and communication in social networks. Of course, a new boss, with new inner convictions and a different management style, also contributes step by step to a cultural change in a company. Changing customer requirements, such as different communication habits, also lead to a process of cultural change in the company that is often not immediately visible.

However, if you want to bring about such a process in a limited amount of time for a larger group of people, so I'm talking about a thousand, two thousand or five thousand people, then you need an active cultural change. It needs a process, it needs responsible people and much more.

Of course, cultural change is always the result of all the people involved. Strictly speaking, therefore, you could say that everyone is responsible for cultural change. Both the managers and the employees. They all contribute to the overall culture with their attitudes, convictions, with their do's and don'ts. However, in our mostly hierarchical organizations, it is the case that leaders have a special responsibility. By hierarchy, they are the shapers. They often define the do's and don'ts and they are the ones who can actively bring about cultural change through targeted measures. The problem is that they cannot do it alone. You can't order culture, you have to take people with you, and that makes it a collaborative task again.

The topic has become more fundamental. Whereas in the past people were concerned with individual aspects of corporate culture, such as the development of a team culture or the development of company-wide quality management or quality awareness as part of TQM, today they are bolder. The goal is usually much more fundamental changes in culture, such as in the transformation of ING-Diba. It wanted and needed to transform itself from a traditional bank to an IT provider and was thus faced with a major challenge. Suddenly, it was not only the use of technology, in a consulting business traditionally strongly oriented toward relationships and trust, that was put to the test, but above all the management culture. ING-Diba took a radical step and changed its organizational structure in one fell swoop. It said goodbye to traditional superiors and experimented with a team culture that relies on self-organization. As a result, cultural change today often becomes a much more fundamental change in the self-image, in the identity of a company.

Quite simply because otherwise most companies will lose touch with the future. And not only in the direction of the customer, but also in their attractiveness for young employees. For today's employees, corporate culture is at the top of their list of priorities. They want to know what the company stands for. But above all, they want a management culture that gives them room for responsibility.

Surprisingly, a number of themes emerge here that will obviously play a major role in the culture of the future. For example, in the future it will certainly be more about personal responsibility and team spirit instead of hierarchy, it will be more about speed and innovative strength instead of perfection, it will be more about flexibility instead of bureaucracy, and it will be above all about collaboration, not only within the company but also outside the company with different partners. This means that in the future, the boundaries of the company will no longer be as narrow as they used to be, and people will react much more flexibly to new requirements in their environment.

Of course, there is no recipe for success. The companies are too different for that. Their histories are too different and the personalities involved are also too different. But there are building blocks that should be considered when approaching cultural change.

In my book "Zukunftsfaktor Unternehmenskultur" (Corporate Culture as a Factor for the Future), I described seven building blocks in detail. They range from a precise description of goals, to mobilization and alignment, to steering and the correct application of the various measures. However, the decisive factor - and this must not be lost sight of under any circumstances - is the people involved. Culture change is something that requires people to be willing to engage in it, both employees and managers. From there, you are forced to take a very hard look at how far you can jump in a company.

If you would like more information on Peter Fischer's book and on the topic of culture change in your company, or would simply like to engage in a no-obligation exchange with us, please feel free to contact us via our contact form.