When it comes to the future of work, digital skills are only part of the story. Resilience and creativity, bolstered by positive leadership, are essential to a thriving and innovative workforce. A new vision requires cultural changes to help you gain the trust of your employees and new technologies to have a lasting impact on the market. To learn more about empowering your own workforce, click here.
Here’s how a transformation effort often happens – and goes off the rails – in many organizations. The CEO and management team decide they want to make a big change, whether it’s improving quality, implementing digital transformation, addressing ESG or any other goal. Recognizing that this means changing the way people work, the senior team sends out top-down messages, littered with vague adjectives and abstract nouns; the company “will be agile in everything we do”, perhaps. In theory, this all sounds good – after all, who can argue with agility? But fast forward a few months later, and not much has changed (other than a noticeable increase in employee skepticism). Often, even the transformation itself is stalled. Why? Because the employees heard a series of words that had no meaning in their daily reality.
The magnitude of the changes that businesses are facing requires them to be resilient and adaptable. Engaging your employees in a transformation journey has never been more important. To do this successfully, you need culture – the invisible catalyst that allows a wide range of change to take root organically – on your side. In our work with multinational companies, particularly in regulated industries, we have identified three important lessons for organizations looking to leverage culture as part of a transformation journey.
Lesson 1: Connecting culture to business “So what?”
Culture change cannot be achieved in isolation and should never be an afterthought on business transformation. Culture should be embedded in business context and logic, an integral part of the continual journey from transformation assessment to performance metrics.
We recently worked with a multinational pharmaceutical company that was embarking on a large-scale transformation to optimize business processes and systems. The management team knew that the associated culture change would be essential. What they didn’t know was if the current company culture was getting in the way of who they wanted to be. So we did a culture assessment to understand the existing pain points.
This exposed cultural issues that were affecting operations. A lack of cross-functional collaboration between teams, for example, was delaying the start of clinical trials, which impacted the product pipeline and speed to market. Part of the solution was to focus on how these teams interacted on a day-to-day basis. We coached and worked with teams to define individual and collective behaviors related to business outcomes and KPIs.
To connect to the business “so what”, culture change must be rooted in measurement. Linking behavioral indicators to business-focused KPIs will give you timely and actionable insights. Imagine you want to lose weight, say 10 pounds in six months. How do you track your progress? You could weigh yourself once a month, but if you find you’re not on time, you won’t be able to change that result. A better leading indicator of whether you will hit your target is your continued behavior. If you set a goal of going to the gym four times a week but you’re missing this key behavioral indicator, you know in advance that you’re not on track to reach your goal.
Lesson 2: Translating Change into Specific Frontline Team Behaviors
Business results clarify the macro context for culture change, but employees also need to understand the micro aspect: what needs to change in their day-to-day work and how they function as a team. To avoid overburdening employees, this should be limited to a few critical target behaviors, which will yield measurable results.
Another example is a generic pharmaceutical company that was seeing recurring deviations on its manufacturing line, causing delays in delivery for patients. The catch-all of “human error” was found guilty. The solution was to encourage problem solving at the root, but what did that mean for leaders and employees in practice? We focused on two target behaviors:
• Leaders had to commit to “actively working with teams to free up problem-solving capacity and respecting that time”.
• Team members had to commit to “proactively raising recurring issues and proposing solutions to resolve issues as a team”.
These behaviors were reinforced by support mechanisms, including a regular leader gemba walks (a Japanese term for when leaders visit job sites first-hand), capacity building in problem-solving techniques, and visible rewards and celebrations of success. As a result, the site sees a reduction in repeated manufacturing deviations.
Engaging your employees in a transformation journey has never been more important. You need culture – the invisible catalyst that allows a wide range of change to take root organically – on your side.
We worked with a management team whose business was growing at an exponential rate. But as a team, they struggled to make decisions and stick to them, often revisiting them after the fact. “We just seem to talk to each other in circles,” as one said. What could they do to become more agile? Together, we came up with a few key behaviors, including “follow up on decisions in meetings I missed” (leaders still need to commit to implementing decisions made without them) and “select something to deprioritize for each new priority. Now that the team has agreed on team behaviors, they are putting in place ways to reinforce their commitments. For example, they agreed to stop a meeting when a behavior is not displayed, explicitly call when they need to make an exception to the behavior and why, and conduct a three-month effectiveness check to determine if decision-making improves.
Lesson 3: Create a plan, but expect to adapt it
As with any change effort, having a plan in place from the start is crucial. But you should also expect the plan to change. Metrics that work in one business unit or geographic market may not work at all in another, so react to what’s in front of you rather than what you expect to see. Focus on incremental progress, rather than trying to force major changes in a hurry. And constantly monitor, learn and celebrate the results.
This principle is common to many companies and among leaders who work to influence culture. We recently halted our culture work for a multinational company, as part of a large-scale transformation program, when it became clear that a business unit was a source of significant risk. Rather than continuing as planned, we took a step back and focused on this business, listening carefully to its team members so we were clear about what they needed and what we could do to help them. (In this case, that meant building a high-performing leadership team before doing anything else.)
The biggest misperception business leaders have about cultural work is that it’s too ethereal and fluffy to make a difference. In our experience, culture is a key way to create lasting transformation, along with foundational elements such as large-scale communication, employee engagement, and leadership alignment. The challenge is to link cultural work to practical, business-relevant changes that directly affect the behaviors of frontline employees. By applying the three lessons outlined above, businesses can create a partnership in which culture practitioners and business leaders learn from each other and generate lasting impact.
- Luna Corbetta is a director at PwC US in the area of workforce transformation. Based in Tampa, Florida, she specializes in strategy and transformation, and is passionate about connecting people and organizations to their primary purpose.
- Margo Stokum is a director at PwC US in the area of workforce transformation. Based in Mountain View, Calif., she specializes in talent culture and strategy for organizations going through large-scale transformations or preparing for the future of work.