The eight enablers of a Transformational Culture

If the past 21 months has taught us anything, it is that corporate culture is the greatest asset or the greatest liability an organization has.  It is widely misunderstood, routinely ignored, yet a potential source of riches when it is managed well. Bearing that in mind, it seems nonsensical that culture is barely discussed in many organisations – unless things go badly wrong of course! 

As an asset, good company culture can drive employee experience. It engenders trust and respect and can create a safe and healthy workplace. It can ensure that customers, investors and stakeholders receive the very best a company has to offer. Conversely when cultures go wrong, they can be stifling, toxic, dysfunctional, destructive, corrosive, confusing, fear-inducing and unsafe places to work within or do business with.

It’s time to take charge of culture

Following the global pandemic, socio-economic and health inequalities have been laid bare. Organizations are straining every sinew to build back better following some of the most challenging and turbulent times in history. Set in the context of a rise in social justice movements such as Black Lives Matter, and #MeToo, rising demands for flexible workplaces, worsening divisions in our community as well as the unfolding economic and climate emergency, what better time as a leader to seek out a definition of good company culture?

A new cultural blueprint

In response, I propose a new Transformational Culture Model – a blueprint which can be applied to any organization irrespective of size, location, sector or maturity, designed to support leaders to create the sustainable business of tomorrow. It is a practical framework for organizations which are committed to putting their purpose, people and values first.

Crucially, the model relies on HR moving from traditional reliance on retributive justice models (blame, shame and punish) to a new, progressive form of transformational justice. Transformational justice balances the rules of the organisation, rights of the employee and the need to generate fair, just and inclusive outcomes when things go wrong, rather than relying on damaging performance management, grievance and discipline procedures.

A word of warning – the Transformational Culture Model challenges much of the conventional wisdom about the prevailing systems, structures, processes and rules which we have come to rely on for many years. 

Below I set out eight enablers of this brand-new model – designed to support organizations which are committed to developing fair, just and inclusive, sustainable and high-performing cultures.

1. Values First – Values are the golden thread that run through an organization. They bind a Transformational Culture together by aligning an organization’s purpose and strategy with its agreed behaviours and overall customer and employee experience. The values of your organization are perhaps one of its most valuable commodities and should be carefully developed, designed and integrated across the fabric of the business. 
2. Evidence based – The use of data and evidence to inform a programme of cultural change is central to its success. Without the evidence base and data to help planning it is like embarking on a journey in the dead of night, in someone else’s car, no knowing where you are going, without a map and with a phone you forgot to charge!
3. The people and culture function – This is a watershed moment for HR. HR policies and procedures which once seemed solid are now being shown to be damaging. The HR profession is perhaps one of the most transformative within the organization, so HR needs to quickly adapt to the new reality – rejecting the dogmas which have acted as a drag on its potential for too many years. This involves HR transforming into the people and culture function, with potential to be one of the most strategically important functions in the modern organisation.
4. Leadership and management – The way in which a leader or manager behaves is perhaps the single biggest factor affecting organizational culture, leaving unwritten cues and clues for the rest of the workforce. A Transformational Culture offers leaders a new set of cultural norms within which they can be held accountable for the choices they make. Leaders need courage to trust their people, listen to them and empower them to be brilliant, irrespective of their background, beliefs, heritage or personal circumstances. At the same time, they need courage to respond with compassion, listen and lead with values.
5. The Resolution Framework™ – A Transformational Culture requires leaders, managers and HR to eliminate their reliance on traditional retributive justice orthodoxies (blame, shame and punish) and embrace a new and exciting form of justice: transformational justice. This brings together procedural justice (concerned with due process) and restorative justice (concerned with reducing harm, promoting dialogue and encouraging learning). The Resolution Framework™ replaces an organization’s retributive justice systems, including performance, discipline and grievance procedures, with a single, fully integrated structure for handling and resolving concerns, conduct, complaint and conflicts. Importantly, the framework is values-based and person-centred, with dialogue at the heart.
6. Wellbeing, engagement and inclusion – These three huge concepts are so interconnected that in my view they should be considered as a single discipline. They are essential to overall Employee Experience (EX) and as a result hold the key to great Customer Experience (CX). To have a healthy workplace we do not need ever more extravagant initiatives. We need to listen, be compassionate, have empathy, engage, understand and resolve.
7. Sustainability and social justice – These two imperatives will become the defining characteristics of the 21st century and their impact on company culture must not be underestimated. Widespread reorientation of the employee relationship with the employer and society at large is profoundly changing company culture. CSR statements are no longer sufficient. The successful organizations of the future will make sustainability and social justice a core focus.
8. Brand, Reputation and risk – Open any newsfeed and it is plain to see that the culture of our organizations and the behaviour of leaders can have a significant impact on the reputation of companies, with careers being ended in a blaze of media interest! Once a culture is lived it can quickly help stakeholders to form an opinion about the overall behaviours, competencies and values of an organization – and therefore the degree of trust and repute in which it is held.

At a time of great uncertainly the eight areas above are enablers of a flexible blueprint for a modern and progressive organisation. 

But for this to deliver a maximum and sustained impact, Leaders must show great courage at this time of incredible adversity. To realize the rewards of a Transformational Culture we will need to embrace radical change in the way we lead, manage and administer organizations. This means putting people before process, resolution before retribution, dialogue before dogma and action before entropy.

We all have choices as leaders: either leave the development of your organizational culture to chance, or actively develop culture in a way which ensures your organizations will be competitive and sustainable long into the future.

Written by David Liddle.