January 14, 2021

TPL Insights: Building Peak-Performance Cultures #50 – Culture is an Environment

By Rob Andrews

This post contains paraphrased content from Daniel Juday.

For many years, we’ve studied organizational culture. When I’m speaking with clients, discussing their issues, and trying to get clear about what they are really trying to accomplish, invariably we wind up talking about solutions designed to move them toward what we call a culture of peak performance, which we believe is truly the only sustainable competitive advantage.

While we’ve built a very robust suite of diagnostics to assess organizational health and an architecture to help leaders build such cultures, we are in relentless pursuit of more knowledge, better research, better tools, and ways to enhance the lives and effectiveness of our associates, clients, and stakeholders. I received an email this week from Daniel Juday, a solo consultant specializing in diversity and culture, and I found truth in his writing.

Daniel says he most often hears the phrase “culture fit” around recruitment and retention. And, as recruitment and retention are increasingly difficult and expensive pursuits for business leaders, this seems to make perfect sense. After all, the cost of a bad executive hire has been estimated to range between five and fifteen times the executive’s salary, and in some cases the cost is so high, it’s incalculable. So, thinking about culture in this context seems to be logical.

Says Daniel, “The problem, though, starts becoming obvious as we ask questions around what fit looks like, and about how we define culture. Hiring an additional team member who is a carbon copy of existing team members may seem like a short-term win, as it relates to smooth on-boarding, but it may be a real long-term loss as you’ve failed to bring in new perspectives, worldviews, understandings, value systems, problem-solving ideologies, personalities, cultural expressions, linguistic richness, and the list goes on and on.

“Without meaning to, I think, what many leaders and hiring managers are saying is, ‘I want more people just like me here.’ We trust those that look like us, and that goes a long way into who gets an interview, and who gets through the interview process. And, at the end of the day, maybe we’ve reproduced a mini-me, but we may have lost a significant opportunity to get better.

“This is tribalism, a term which has gone through a recent resurgence a la the ‘find your tribe’ movement. And, I want to say, I think it is awesome, when we protect ourselves from implicitly connecting our ‘tribe’ with those we think are most like us. The reality is that’s what we most often do. We are geographically and socially encouraged to connect with those ‘like us,’ and in terms of how we connect, our socioeconomic levels largely predict that.

“We are, generally speaking, operating in silos of ethnic, cultural, linguistic, socioeconomic, and ability similarities. We just are. It’s the way we built our neighborhoods. It’s the way our social groups subsequently develop, and the way we hire those in our circles.”

Daniel’s observations are astute. It’s easy to miss the true meaning of cultural fit. Cultural fit doesn’t mean hiring in one’s own image and it doesn’t mean creating an organization of Stepford wives. Cultural fit means aligning the workforce with the organization’s purpose, mission, and values. Peak performing organizations are those in which great diversity and inclusion exists. Great diversity means diversity of race and gender for sure. It also means diversity of generations, political views, and thought processes, to name a few. Ideally, an organization’s board, leadership and management teams should be reflective of the communities and stakeholders they serve. Peak performing teams are those in which healthy debate occur and diversity of thought is valued.

Over 27 years, we’ve studied almost 5,000 failed executive placements and almost half of them fall into the category of cultural misalignment, so it is in fact a very big deal. The thing about culture that many don’t get is that culture is very specific, and it’s not about right or wrong. The behavior that’s revered in one company will get you fired in another. Gallup says that your culture has the ability to enhance your brand, improve business results, and fulfil your organization’s purpose.

When leaders and managers create a clear, consistent, aligned culture that inspires high commitment, employees believe in and live out the organization’s purpose in their daily work. When coaching executives in transition, or who are seeking a new opportunity, I implore them to examine the organization’s culture carefully to ensure alignment. It is important not to take what’s been written on the company’s website regarding culture as gospel. I suggest they talk to several executives within the firm and make sure the stories align.

Boards, leadership, and management teams should make certain the statements they make around culture are clear, and that they make the distinction between reality and aspiration. To say that we aspire to become a company that is truly diverse and inclusive is better than claiming to be one if you’re not there yet. Saying you operate in an environment in which customers and employees are valued and have a new executive discover that shareholder value is all that counts, is bound to confuse, and frustrate newcomers and the workforce as a whole.

Further, make sure that your hiring practices screen for cultural fit. Bring diverse people into your organization who are excited about your purpose, who want to be an integral part of your mission, and who are aligned and passionate about your values. If everyone you recruit brings true diversity, alignment with your purpose, mission, and values, and can deliver on your specific performance expectations, you will be light years ahead of most of your competition.

I hope you’ve found this week’s post helpful. Allen Austin exists to fulfill its purpose, which is to enhance the lives and effectiveness of our associates, clients, and stakeholders. Our solutions are focused on assisting clients in building cultures of peak performance, through our retained search and leadership advisory practices. Please give us a call if we may assist in any way, or if you’d just like a thought partner.

Warmest Regards,

Rob Andrews
Allen Austin
Consultants in Retained Search & Leadership Advisory