Company Culture: The Key to Making & Sustaining Change
Jim de Vries, Founder & Managing Director at Enhance International Group, has helped countless organizations navigate change and achieve organizational excellence. He shares why culture is so important to driving change and how to create a culture that supports a resilient enterprise.
- 4 types of workplace cultures
- The impact of a poor workplace culture
- How to shift the culture at your workplace
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Check out the full episode below:
Jim de Vries: If you create that environment where the people are looking for a change and being part of it, it can happen, but if it’s all tops down changes, that will not work.
Josh Santo: Welcome to Conquering Chaos, the show for manufacturing leaders. In each episode, we’re connecting you to the manufacturing leaders of today who are driving the innovations needed to future-proof the operations of tomorrow. If you feel like your time is spent fighting fires and trying to control the everyday chaos, this show is the show for you. My name is Josh Santo, I’ll be your host. Hey, y’all, it’s Josh. Before we get into this episode, I wanted to put this into your ear. If you like the types of conversations we’re having, you’ll enjoy the content that we share through our mailing list.
Go to parsable.com/podcast, scroll to the bottom of the page, and sign up to get more insightful content delivered directly to your inbox. Okay, onto the show. Welcome back, conquerors. Today we’re going to talk about something that’s fundamental to conquering the everyday chaos, but first, our guest. Our next guest is an operational excellence executive who has trained and mentored thousands of professionals globally, overseeing the implementation of 1,000 plus projects and has helped countless organizations with change management, team building, and leadership development over the course of his 30-plus-year career.
He’s the founder and CEO of Enhance International Group, where he consults with companies like manufacturers, on business transformation, supply chain management, operational excellence, and more. Please welcome to the show, Jim de Vries. Jim, thanks so much for being here.
Jim: Thanks for having me, Josh. It’s very exciting to be here with you.
Josh: Yes, we’re really excited to pick your brain, especially on this topic, but before we get too far into the episode, we like to start each episode with the same question. What’s your day-to-day look like in your role?
Jim: In my role today, as a consultant of over 50 companies today, it’s working with my 50 partners. It’s working with my four or five direct clients, and, of course, family. Always have a honey-do list.
Josh: When we first started this conversation I couldn’t help but notice that Jim has a pretty professional set-up. He’s got some high-quality audio equipment with a high-quality camera, and it’s because you’re a bit of a showman yourself, right? Do you do a lot of webinars?
Jim: Yes. In a couple of years, we’ve done over 50 webinars. We’re doing between three and five a month in areas of, we cover people, process, data, and technology anywhere to help a company improve their operational excellence for that sustainability, to build that resilient enterprise.
Josh: Three to five a month. I feel like the most I could do is two. Just with all the work that’s involved with putting together a webinar, organizing it, and getting the word out, so, kudos to you for getting three to five out per month. Maybe I could take some lessons from you. Today, we are covering a topic that I think is something I’m pretty interested in picking your brain on. Over the course of a lot of these episodes, we’re always introducing some idea of change. If we’re trying to help the manufacturing community overcome the everyday chaos to do that, that’s going to require some sort of change.
That’s a common theme, but what pops up when we talk about change? Resistance. The question is really, why the resistance? I’m sure that’s a complicated answer. Is it a process that gets in the way? Is it bureaucracy? Is it something else? I’m sure there’s a lot, but Jim, I want to ask you, especially with your rich background in operational excellence, what has become the most difficult barrier to change to overcome?
Jim: I think people just don’t like to change. Many companies I go to say, “We don’t want to change the culture of our company, but we want to see a 10X improvement.” You’re saying, “How are you going to make improvements if you’re scared to change your culture or what you’re doing, and the cadence of how you work?” It really starts from the leadership, and, are you a bureaucratic type of environment? Are you more of a startup? Are you more agile? Are you more clannish? It depends on the culture of your organization on how open you are to change, which is really driven by the leader.
If the leader is expecting change and wants people to change and reward it, then you’ll have a changing environment, but most cultures are trying to keep the chaos out. Then you keep the chaos out, you actually create chaos. As you try to push people to only do one thing, then you’re actually causing them not to want to change. If you talk to any individual when they come out of college, they say, “We’re going to change the world,” but when you are in an organization, after a while you say you really don’t want to change anything here. We’ve tried that, we’ve done that, and it didn’t work.
Josh: People get set in their ways to a certain degree. I like that you called out specifically culture. I think that’s such a term that encompasses a lot. Could you help break down a little bit better what culture is, particularly within the working environment?
Jim: The culture is what you can say, how you can act, can you speak up? Can you raise your hand? It’s, on the factory floor, could be just the culture of if you see something going wrong, do you feel empowered to say something to someone that you may not know you’re walking through, and that if you bring it up, how would that person react? Would they react negatively or positively? The culture is of course driven by management, their thirst for excellence, and their openness not to punish everyone or anyone who makes a mistake.
You can take it to the Japanese approach where if you make a mistake, it’s okay. You need to push those boundaries, but you have to understand why you’re making the mistake and remedy it. Everybody is there to help the new people coming in to help them address those things. They encourage finding issues and ways to improve. From a cultural perspective, it sets the tone, and I call it the cadence of the organization. What is the cadence of the organization which is set through the culture?
Josh: You can say how you can act, can you speak up? Can you raise your hand and report something to just about anyone? If so, what’s that response going to be to the fact that you did that? Embracing or focusing on this idea of what happens when mistakes are made, ties into the culture. Is there an openness to turn those mistakes into teachable moments versus are mistakes punished? I think when we start to break down, those specific items as you shared, we can start to see elements that people can use to gauge what their current culture is.
I love that you tied it back to this idea of, do people feel like they– Actually, maybe I’m assuming some things, but part of this is, because a lot of conversations I’ve had with people, I don’t think anyone would disagree with the items that you said. A lot of people would say, “We encourage that, we support these items,” but I’ve talked with plenty of frontline workers, in particular, operators who are manning the machines on the line, who say, “Whenever I raise an issue, nobody listens to me, so I’m just not going to tell anybody about these problems anymore.”
There seems to be both this idea of intention, action, and follow-through, right? I think maybe sometimes the lines get blurred with that. You mentioned as I said, these items, don’t sound like an extremely new idea, but obviously, that’s not in place in every single culture or every single working environment. How would you describe the typical working culture that you’ve encountered?
Jim: Again, I break it down to those four types of cultures that I mentioned in the beginning, which are, bureaucracy, more clannish, more startup, and more agile. Depending on which of those cultures you’re in, that’s going to define the company. You see, generally, high-tech companies tend to try to be more agile. I’d call them the post-2000 companies, in general, tend to be more agile. The bureaucratic companies tend to be the pre-2000, heavy industrial, in general. It’s not always the case, but, in general. Then startups, a lot of MNAs being bought out, being really high growth companies.
Then the clannish companies are companies that could be any of these companies, but often family-run businesses. Again, as soon as I put those into those categories, somebody will find an exemption. These are just general things that you observe over time. There’s really no right or wrong here. It’s just who you are. Just understand who you are, and then how things go get done. Again, it comes back to that cadence. You’re looking for that drumbeat of how production gets out the door, how calls come in through a call center, there’s a rhythm. You can see it.
When you look at the transactions per person, per day, or their widgets per person per day, you see it and you can feel it in the attitude. When you link the production or transactions to the tenor of what’s going on in the workplace, you develop that cadence.
Josh: I like how you broke that down. You have to understand who you are at a high level. As you said, it’s not going to be a perfect fit, but it’s a guideline that can help you recognize certain traits because, by recognizing that, then you can start to do something about it, as well as how things are done. How are they getting done? That idea of a rhythm certainly makes sense. There have been times when I’ve been on a shop floor where I swear it sounds like music. You hear that constant beat of the machines moving, the parts, being made, all the other noises coming together.
It’s a bit of a symphony at times. I’d like to spend a little bit more time talking about those four types of cultures. You mentioned bureaucracy, clannish, startup, and agile. I want to make sure we’re all on the same page as to how we’re referring to these, or what constitutes this type of culture. Would you mind taking us through a little bit more, when you’re saying bureaucracy, what are those attributes that you observe? Clannish, you mentioned if it’s started by the family, or if there’s a group of people who are, I think of the popular kids versus the not popular kids. A startup, bring in some more definition there in agile because that’s a term that I hear a lot that I think we should clarify what that is. If you don’t mind I’d love to hear some more.
Jim: Sure. Okay, great. If we start with bureaucratic, because that’s their traditional, you think of Ford, or GM, or any of the big automotive industries, I guess I’ll pick on them a bit, but they’re going to have 20 layers of management or 15 layers of management. Everybody has their job, you have your set of things to do. You have these boundaries in the walls, you are within these walls and these constraints, this is what your job is. It’s a need-to-know kind of thing. We don’t want to burden you with things that even though you’re giving it over to another department, we don’t want you guys talking to each other because it’s a distraction.
I often hear that in a bureaucracy, “Why do they need to know?” You hear that and you go, “You’re giving them something, and what they’re getting is not the right thing. They don’t know who to go to because they don’t even know where it’s coming from. There’s no transparency at all throughout the organization.” You see that a lot in those big companies that are managing, they’re $150 million, $100 million companies. They’re very, very complex and decompartmentalize things because of trying to get to your throughput, but then you start sub-optimizing. That’s bureaucratic. Are there any questions more on that?
Josh: No, I like how you said it’s siloed intentionally so because you’re trying to keep groups focused. Assuming positive intent, I get that. You want to keep people focused on their scope and their task. To do that, you’ve put these barriers up to keep people focused, but that compartmentalization like you called out, is actually impacting the throughput of the overall process, right?
Josh: It comes back to that idea of if the goal is to get this thing out the door at the quality that it needs to be, to the people that it needs to be, on time when it needs to be, this is a whole team needs to work together.
Creating those silos without providing visibility can actually be a negative impact. I really appreciate that summary.
Jim: Great. On the opposite of bureaucratic, we would almost say agile, which as you said, is an evolving definition. Who knows what the definition of agile– Is it just everything we want, but can’t have? I often think because it’s going like, “Gee, If everybody just could talk to each other, the whole idea of agile is you pull down the walls. You get rid of the silos, everybody is talking, and it’s more pluralistic. People are working together. Everybody understands the end-to-end value stream of the product from beginning to cradle to grave.
If you see something wrong, you have the right to go and help work on it and fix it. You’re not going to be chastised, “You can’t go over there.” None of that slapping of the wrist, and that really works if you have strong communication. It’s not like you’re getting rid of SOPs, it’s actually, that you need all the SOPs. The problem in the bureaucratic world is we build SOPs, and they sit on the shelf, but they’re not active. What you’ll see in an agile environment is the SOPs are active. Everybody owns the SOPs. If you see a problem within SOP, you’re fixing it.
It’s not saying you get rid of SOPs. A lot of people say, “Oh, they don’t have any structure.” No, if they see something wrong, they have the right to fix it. It doesn’t take six months to get it approved. The people who own the SOPs are actually the people doing the work. It’s not a third department, the quality department, that owns the SOP and the oversight. The people doing the work own it, and they have the right to change it. They still have to bring it up by committee, but it’s their job to do that. What we did when we were driving, is we had every team leader own an SOP and teach that SOP every six months.
They have a new SOP, they drive it, they train people, then cross-train. Everybody is cross-trained. There’s none of this, “This is your job,” kind of thing. The goal is to cross-train everybody in the organization. Those are some of the elements of agile. I’m missing, I’m sure, a lot of other ones.
Josh: I think you started it off perfectly with it, it’s an ever-evolving definition, and it probably looks a little bit different to everyone that brings up the term agile. I love that you juxtaposed it with the idea of bureaucracy. Everything that you noticed about bureaucracy, probably think the opposite for agile, and you’re on the right track already. That idea, though, that you talked about of the example of the people doing the work, owning the processes, and when we say own, we’re talking about you being responsible for iterating the process based on what you find to be working or not working.
So many times, in the business that I work with here at Parsable, we see such a disconnect between, here’s the ideal process, here’s the way that we think it should be conducted versus the way that it’s actually conducted. What does that lead to? Tribal knowledge, for example, or variation, right, if it’s supposed to be standard work.
Josh: You want people doing things the same way. Otherwise, it’s not standard. If it needs to change, then be open to making it change. That therein lies the point that I’m getting at. a key component of agile is that change, that openness to change, the understanding it’s got to evolve, it’s got to change. Things are going to be different, and I think that that’s such a focus right now in the industry, is that idea of adaptability where you started this conversation with building towards resiliency, and that’s a key piece.
Jim: Absolutely. The other two are, as you said, juxtaposed, are opposite, are a startup and the clannish kind of environments. The startup, I always think of a JV in a startup, or somebody comes in and does a cost out. It’s very accelerated, you need to grow 10X. It’s a small thing that you’re trying to grow into scale. In the startup world, everything is scale. Scale, scale, scale. We got to hit our minimum throughput in order to make this business profitable. That’s a startup kind of mindset. Sometimes you throw the procedures out, SOPs out.
You’re trying to get the stuff out the door. That’s a completely different culture, and it has its merits to get the stuff out the door and say, “Oh, we’ll figure it out later. If you hear that a lot, “We’ll figure it out later,” you might be in a startup kind of a mode. If you go, “We’ll figure it out later,” and you’re going, “We’re growing 10X and our costs are out of control, but as long as we get enough volume out, that’s what we’re being graded on, so, okay, we’re going to get it out the door,” and you pay the extra, everybody is on overtime, 30%, 40% over time, to get it out the door.
Of course, to sustain that over time, you burn out people. There’s a lot of emotion in those environments generally. [chuckles]
Josh: Absolutely. No, I couldn’t help but think of Jeff Foxworthy when you described the startup. “If you’ll figure your SOPs out later, you might be a startup,” that was all ’90s little bit that he had. Yes, I get it. It’s a scramble and it makes sense. What do you need to prioritize? You would think the way that you do things is a priority, but there’s an element of agile that’s inherent within startups so much so that you don’t take the time to take some of the good things from bureaucracy and put those into place.
Jim: Absolutely. That’s why we put it off to the side, and then the clannish is a little bit tougher kind of a world. It’s kind of an incestuous kind of a world where, somebody starts a company, and, as you said, it’s almost like you’re going back to high school. Are you in the in-crowd or the out-crowd? There are these little pods of people that, are you in the know? Those kinds of things. That’s a pretty unhealthy environment to live in because one minute you’re in the crowd, and the next minute, you’re not. Generally, you will not be able to sustain people for a very long time in that environment, but the younger crowds, a lot of people tend to like that because it’s a loose environment.
It’s more an avant-garde kind of environment. At some point in time, people want some processes, procedures, and SOPs, but they’re not getting them. It’s more of who you know to get things done. Also, the expediter in your company, the firefighters are really, really rewarded in these environments if you’re really good at your job and you’ve noticed. If you do your job every day, and you do it perfectly, in this environment, you will be overlooked. If you go out and find the fires and you become the hero, you will thrive in this environment.
The people who do their job every day, they’re very frustrated and overlooked, and management sometimes says, “Oh, they’re not doing anything.” That’s what I would hear. I’m like, “That guy is cranking it out,” or, “That gal is cranking it out.” They’re going, “No, they’re not. He goes, “I never hear anything about any fires.” “Yes, because they’re cranking it out. You got to look at the numbers.” They tend not to look at numbers, they look at emotions.
Josh: That’s such an interesting point, this celebrating the hero that steps in the darkest moment, versus the people who have kept everything running up until that point, and it just so happens for whatever reason, there was a failure, but not getting the same level of recognition even though both are pretty equally important. If not, maintaining every day is even more so because that makes up the majority of your production time. That’s such an interesting point to bring up. When we first started talking about culture, you were very upfront, that leadership is responsible for setting the culture.
Now, there are a lot of different roles in leadership, is this something that has to be set at the C level, or is this something that’s more, let’s say, taking a manufacturing environment, is it plant management? Is it the functional leaders of the different departments? Who sets the culture?
Jim: That’s a great question. I’ve seen it where, a facility, a particular manager sets the culture and can really make that facility rock, so to speak, in a positive manner, but their management above them may not be that great. I would say that that happens maybe 10% to 20% of the facilities may have that hero. Not a hero, as we said before, but a really great leader, I should say. If the CEO and the VPs, the C suite, let’s say, aren’t really driving the culture in a positive manner of empowering people, then even those managers will leave.
Those plant managers will end up leaving because they’re frustrated. Some stay there forever because of family, for different reasons, and they’re left alone. If they’re left alone, they’re very happy. They want to be a plant manager until they retire, and they’re fantastic. Then, if the Leadership isn’t there, then they can’t spread those good works of Frank, who runs that facility across the whole network. If they’re not thinking, “How do we replicate Frank across the network or Marge across the network?” then the question is, who’s responsible for that?
It’s the CEO. It’s the C suite, who are there to set the tone. If they’re micromanaging their facility managers, and not empowering them and removing roadblocks, then they’re taking the reins away from them. Just like in a frontline, you have to allow your frontline worker to fail a few times. As that facility manager comes up to speed, they’re going to fail a few times, but you need that mentorship. I think the greatest leaders say, “My number one job, for my company, is to help my employees be better.” That’s true leadership.
If they say, “My job is to change the culture, to come up with new products,” you don’t hear the great leaders of yesterday, yesteryear, or even today, say, “My job is to come up with new products.” They say, “My job is to create an environment of great people.” That’s a true leader.
Josh: Hey, we’re going to take a real quick break to hear from our sponsors. Stay tuned for more Conquering Chaos.
Rob: Hey, listeners. It’s Rob. I’m one of the producers of Conquering Chaos. I’m right here with you for every episode, working behind the scenes to make sure everything is just right for your listening experience. Whether you’re a new listener bingeing content to help you conquer the everyday chaos, or a dedicated fan tuning in for each new episode, there’s one thing to always keep in mind. Information is useless unless you use it. Obvious, right? It’s so easy to learn, forget, and then miss out on the opportunity to make real improvements to day-to-day activities.
The folks at Parsable have an opportunity for you to learn, experience, and make real improvements to those same day-to-day activities. Get rid of paper on the factory floor. It’s the quickest and easiest way to make a measurable impact on safety, quality, and production. Think about it. Paper-based checklists, forms, and SOPs isolate workers from getting the information they need when they need it, which leads to a number of inherent inefficiencies that you probably accept as a part of your own everyday chaos. As a result, you can’t respond quickly to problems, you struggle to standardize the completion of critical tasks, and you miss out on new continuous improvement opportunities.
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Josh: That’s such a critical point. You look at works from the past, one that comes to my mind right now is a book called Good to Great.
Jim: Good to Great, yes.
Josh: Yes, in which they break down why some companies are able to make that leap to great companies. The first half or more of the book is just about the importance of people and the importance of leadership bringing in those people, enabling those people, and, like you said, mentoring and coaching those people. I think that we’re seeing a bit of an impact right now in the workforce of the impact of a poor working culture, and the great resignation worker shortage. I know that there are a lot of opinions out there, but I think ultimately, what we can all agree upon is what people are saying is they don’t want to work for you.
If you’ve got people who are leaving, who you’re not able to recruit for your operation, that’s a pretty clear sign from the market of employable people saying, “Your opportunity is not an opportunity that I want to be a part of.” From your experience, what are some other impacts of a poor working culture?
Jim: I’m just building on what you just said, I thought it was interesting because if you go back in the years in the ’40s and ’50s, you were lucky to have a job, and you’ll take any job in order to put food on the table. Then the companies like DuPont, treated you from cradle to grave. DuPont literally took the family cradle to the grave. The pension program and all that was created out of DuPont, out of the thirst for helping people all the way through. That disappeared, of course, in the ’70s and ’80s, as the disruption of our economy occurred, and everything started getting shipped overseas, and the loyalty to the company first.
It really started when people went on strike, and then the owners say, “Oh, these people aren’t loyal.” Then we had all those trucks back and forth, and now it’s, we’ve gone around where the people aren’t loyal to the company. Then through all this, people are starting to realize the job that they have isn’t what they want to do. Then they realize they went to college and got a degree in something that they really never wanted to do, and they ask their parents, “Did you do what you wanted to do?” Probably most parents say, “No, I never did what I wanted to do.
I did that to put you through college so you could do what you wanted to do. Are you doing what you want to do?” They go, “No.” It’s pretty fascinating, in the last 20 years, what’s happened. It used to be if you stayed in a company for more than five years, it was good. Now it’s if you stay in a company for more than three years, it’s bad. The only way you get recognition is to jump companies. Companies don’t reward you for staying, and there’s no upward mobility. If you made a mistake in a company, God forbid, in your first couple of years, there’s no redeeming grace unless you leave the company.
We all make mistakes, we’re not very forgivable, and we love paradigms. Why? Because it’s simple to put people into boxes and say, “Oh, Jim can only do sales,” or, “Jim can only do supply chain.” They can’t believe that Jim could do both or would want to do another area. The one thing and I haven’t brought up Jack Welch because he had a huge impact on me for my first 15 years, is what he did was, at the end of every year, they called him Neutron Jack, yes, because he got rid of things and made you come self efface to say, “Am I doing the thing that I really love?”
If you weren’t, he didn’t fire you. It felt like you were fired, but he put a placement program to get a job at GE, and at that time, was one of the biggest employers in the world, and you could get another job at GE. He was one of the first ones to say, “Go find out what you really want to do in life. I know you’re a good person Josh. We love you, but what you’re doing in your job is not where you can excel. Maybe you need to do something different. To find out what it is, we’ll get you in that program and see how well you do there. You’re a great guy, Josh.
We don’t want to lose you. We hired you the first time.” Welch was doing that in the ’90s, and we’re still trying to figure out how to do that in the 2000s, which, to me, is ironic and funny. Not funny-funny, but it’s unfortunate for many people that they’re starting to realize that. One of my partners, Predictive Index, actually does that very well. You do a self-assessment, and it tells you what you’re really good at, and what you would really enjoy and excel at. Whether you use Myers–Briggs, use whatever you can, find out what your real passion is so that you can excel because people read through passion.
If you’re passionate about your job, you can do anything. I think that’s what you’re seeing the revolution is, si the work of revolution of people finding their passion.
Josh: Yes. Certainly, like you said, reexamining, “Is this what I’m meant for? Is this something that, when I get up, do I look forward to the day, or do I really feel anxious about having to go eight hours or more doing whatever it is that I’m doing?” I think you brought up a good point. We’re in a very great situation right now, where there is a proliferation of so many different opportunities that it has given people the ability to say, “I actually don’t like working for you. I don’t like doing this. I want to do something else,” which is great.
To your point, it should be encouraged because there are probably opportunities within the same company. We had, her name was Sarah Dale, she’s a plant manager for International Paper, in a previous conversation. She wasn’t looking to start out in manufacturing when she got out of school, but she tried it, and she found that there were aspects that she enjoyed about it. If you look at her career, she’s worked in many different aspects of manufacturing within International Paper. You mentioned five years was good, now three years is bad.
She’s been there for 10 years. As a millennial, that’s a pretty big deal because you’re right, job-hopping is common. It’s because the company, to your point about Jack Welch, saw that there was promise in this employee to bring value to the company and to also provide value to the employee in a way that she was going to really appreciate and thrive and develop as a result. I love that you brought that perspective up. We’ve talked a lot about examining cultures and the different types of cultures that are out there. Let’s say we’ve hit on that enough, and our listeners are like, “All right, Josh, all right, Jim, we get it.
We’ve taken a look, we’re looking at a bureaucracy,” or, “We’ve got a more agile–” Look, admitting is the first step that if there’s a culture change that needs to happen, what culture it is. How can leaders go about instituting a change in culture? Does this require new leadership? Can existing leadership reinvent culture?
Jim: Oh, existing leadership can certainly invent new culture. Anyone, if they set their mind to it. You really need an outside entity to come in to help you through that transition of what you are today and what you want to be. There are very well-established change models that we used in the ’80s and ’90s under Tucci, which still work perfectly today. It’s all about following a few steps here, creating a shared need. What is the problem? Understanding what do you want to be? Shape that vision, that’s the second step. The third is then mobilize, who’s going to lead this for a proof of concept, so to speak.
Make sure that all the key stakeholders are involved, and then build your transition plan. Then start moving into sustaining the change and control your results. You can be doing this all the time. What we had at GE was we had change events that occurred. We had to do so many a year, and Welch didn’t care. He just said we just need to get a culture of change. These are mixed groups of people, you get everybody from an admin to somebody on the floor, to a sales rep in the room together. You say, “What do you like about the company?
What don’t you like about the company?” It just gets the creative juices going, and it also builds that trust between different organizations. It tears down the walls, and the silos that we talked about, and prepares the organization for the change. It’s not just that leaders say, “I want to go from point A to point B.” Your organization has to be ready for that change.
You have to allow them to practice making changes, as small as they could be, that people need to be used to making changes. If we’re going to live in an evolving world, good companies are always changing and adapting to the environment that is out there.
I think at GE we changed our operating structure every 12 months to 18 months. It drove people crazy, and you say, “Why did they do that?” That was argued about quite a bit because they said as soon as you get settled in your job, you’re going to move because if you get settled in your job, you become complacent, and so you’re not ready for change. He would just purposely change people when he saw stagnation. Anytime he saw a stagnation, he would say, “Okay, you got to change.” He never said, “You’re stagnated.”
He’d just say, “We need to change,” or if there was an external factor of the customer or environmental changes, he would say, “We got to change because of this. What’s the best way? He would always involve the people to make that change. I think if you create that environment where the people are looking for a change and being part of it, it can happen, but if it’s all tops down changes, that will not work. That can’t sustain itself.
Josh: I love that you called out, you have to involve the people, the people have to be a part of it. Because we’re talking about change, we’re talking about adapting, that gets back to that culture of agile, to a degree, and really pushing some of the ownership on change, to everyone who is touching some part of the business, really empowering each person to stand up, and say, “This is the thing that I think could be improved. Here’s how, and let’s make it happen.” I can certainly relate to that idea of wanting to keep things constant because sometimes, look, as people, we do want to just put things on autopilot.
We know how to do it, it’s done this way. It’s normal, I understand it. It’s challenging to rethink and reimagine things. That takes a lot of effort, exercise, and creativity, but I think ultimately, what we’re getting at is that the impact is that the company sticks around for years, and years, and years to come. How many companies have risen and fallen in their time because they didn’t adapt, they didn’t change, they dismissed things as fads that were actually there to stay? That’s such an interesting point. You broke down these different classic steps as far as identifying a change and getting an organization on board.
Can you talk to us a little bit more about the different tools or strategies that help leaders shift their cultures?
Jim: Yes. Probably the most common tool out there is going to be your stakeholder analysis, is to say, “Where is everybody on there on the change?” Anytime you’re trying to do anything, you got to start with a stakeholder analysis. Then your visioning, what is yours to be? Where are you at today? There are some simple visioning tools to use there, and coming up with your rallying cry. What are you going to wave your banner and say, “This is our vision, this is what we’re going to do for the next 18 months,” and really make it empowering for the folks?
Again, these are things that you need to do with the folks. Now, I go back to stakeholder analysis as one of my pet peeves because most people don’t do it. Why? Because they don’t want to offend anybody. You’re saying, “Are you on board, or are you not on board?” If you don’t get to the bottom of that, forget it. No matter what you do, it’s not going to work. You really need to take a hard look at who owns the process, who evaluates it, who operates that process, and those groups, and all those stakeholders that are crossing together, and make sure that you honestly say, “Are you really aligned to that vision that we all put together?
We spent a day working out that vision, are you really bought in, or were you just giving it lip service? What are your concerns? We’re not saying your current concerns aren’t important. Just because we came up with a single vision, if you don’t believe in it, you need to tell us why, and we got to work together to overcome those things.” If you don’t have those honest conversations in the hallways and over dinner or whatever it is, if you don’t have that, and it’s not clear, you’re not going to be able to move forward. What’s so often overlooked, is that piece of the change management.
It’s not that complicated really, but it’s hard because it’s self-effacing. People don’t want to come across as, I’m not on the team, and they got their day job. “Everybody has got their day job, now you’re asking me about this, am I onboard? Then, how does it affect my day job? Am I going to be out of a job?” Everybody is worried. The first thing when you say change is the point out where they can change across the aisle. Everybody points across the aisle. If you’re on this side of the island, it’s a change on the other side, no matter what. If it affects me, “Oh, you want me to change? Oh, no, I think we’re good. We’re good.”
Josh: It’s so interesting that you broke down that there’s a fear of offending people, and that you really have to have some tough conversations with regard to change because we’re talking about driving alignment. Your impact is going to be as strong as, for lack of a better word, the weakest link.
Josh: I don’t mean weakest in the terms of weak, but just that idea, if someone has not bought in, if that falters, that’s a crack that needs to be addressed. The way that you address it is by empathizing, really understanding what is the way of that individual, connecting with them because when you can understand the why, that’s when you can start to lead towards, here’s where we’re going, and here’s why. Here’s how that connects with your why, and here’s why we’re inviting you to be a part of it.
Jim: [unintelligible 00:45:26].
Josh: Yes. We talked about assessing your culture, making change, and sustaining change is a totally different conversation. The last question I want to throw your way, is maybe this is a two-parter. The first part is, is there a realistic timeline for change, or is this something where people just have to accept that it takes as long as it’s going to take, and then how will leaders know that the change in culture has come to fruition?
Jim: I think, realistically, to make a change, it depends on how big. Is it an end-to-end company? Is it a division? Is it a work team? You’re probably talking in the order at a work team level, at least three months to six months with the right leadership, and driving it for everybody’s voices to get heard and the new cadence to be created. Organizational changes are generally in the two-year range in maturity models. Most maturity models go foundational to visibility, let’s say. To predictability, resiliency, and sustainability, any large maturity model, if with concerted effort, you’re talking in the order of two to three years per stage.
If you have a 5-stage maturity model, it’s 10 years. People look at that, scratch their heads, and go “Really?” The answer is, really. The other thing I would say is most maturity models are five stages. What happens generally is you move from Stage 1 to Stage 2, to Stage 3, fairly rapidly over, let’s say two years to five years. When you get to Stage 3, it’s like a wall because when you get to Stage 3 in any maturity, most companies can’t stomach it because it requires a complete change in the way you do business. What happens is, I call it, it’s a one-two-three.
You have a new CEO, they come in, they bring some of those to Stage 1, Stage 2, and Stage 3. They get stuck on Stage 3. They brought a lot of value to the company, but the shareholders want more. Everybody wants more, no matter how well you do. Getting over that hump takes a lot more work. The shareholders have no patience because they think the momentum was lost. They oust the CEO, and it collapses down to a new CEO comes in because as the new CEO, what do you do? You tear everything apart because it was all wrong. Whether it was wrong or not, doesn’t matter.
You tear it all apart and you start all over again. I call it the one-two-three step. Most companies are doing the one-two-three. It’s very hard to get Stage 3, and Stage 4, and sustain themselves above that. There are the exemplars out there that have done it, for sure. We all know who they are. That’s what most articles are written about. That’s why– I saw this morning that there’s something in Brooklyn, and they’re bringing all the exemplars together. They’re having this big powwow about how to make difference in organizations. I’m like, “This is great.”
It’s a brainstorming design session, is awesome, but it’s for the people that are already at that Stage 3, Stage 4, and Stage 5. When you read Fortune, when you read all the magazines, all the articles are about those folks. McKinsey, everybody. Then you’ll see a small byline at the end about what 80%, 90% of the companies are going through. An editorial or something, and they’re very well written, like Harvard Business Review. They’re very well written, but it doesn’t sell magazines. Everybody wants to talk about being an exemplar even though they’re not.
Sustainability is obviously the most difficult thing. We talk about that in our Sustainability and Resiliency series, but we need to build that infrastructure and build it up as we’ve just been discussing.
Josh: You need those foundational elements because what you’re describing, those that have accomplished the Stage 3, Stage 4, and Stage 5 sound a little bit like the heroes when really, we also need to put some focus and some celebration on that day-to-day, getting everything done that needs to get done so that then you can take it through. Then just to follow up on that question, how can a CEO or whoever the leader is, look around and say, “We’ve made it, we’ve made it to Stage 3, we’ve made it to Stage 4, we’ve made it to Stage 5.”? Are there any tell-tale signs?
Jim: I go back to cadence. You’ll feel it. You’ll feel that. In Stage 3, everybody will want to work for your company. I would say, you’ll feel it. You will not have to advertise for jobs, people will come. Of course, we’re in a shortage, the number of employees now for jobs, but you’re a natural choice. The top talent in the world will gravitate to your company and want to work for you, and you won’t have to pay a top salary anymore. That’s when you know you made it. Of course, your stock will be going up. You’re growing for all the good reasons.
I think those are the Stage 3, Stage 4, and Stage 5 companies, and you’re resilient. Sometimes there are some very mature companies that may not be doing that great on stock, that are doing quite well from profitability. They’re hitting their margins, and they keep on scaling and growing. You’re meeting those growth targets.
Josh: That’s great. Jim, I certainly appreciate you taking us through assessing culture, the impact of culture, ways in which you can take inventory of your own culture, and ways that you can certainly start to look at reinventing your culture. How can our listeners continue the conversation with you?
Jim: They’re welcome to join us on one of our webinars at consultingeig.com. We have over 50 webinars up that are there for your perusal. We have training of over 70 courses, and we have over 50 companies in our partnership that provide people, processes, data, and technology. We are here to help companies excel and enable. We all have the mantra, “Help the company and get out of the way.” That’s our mantra of EIG. We’re not in there to stay, we’re not looking to set up shop. [chuckles]
Josh: We’ll have a link to EIG in the show notes. Be sure to check that out. Jim, thanks so much for joining us today.
Jim: Josh, thanks for having me. Really fun conversation. Fantastic.
Walter: Hey, y’all. It’s Walter. I’m another producer for Conquering Chaos. Before you go, if you’re not ready to try Parsable to help you get rid of paper, why not watch a quick video instead? Check the show notes for a link to a demonstration Josh put together to show frontline workers what it’s like to use a dynamic digital experience to get work done. In it, Josh shows you how using a modern-day app enables you to connect to people, information, systems, and machines, just like the apps you use in your personal lives. Take a look and let us know what you think.
Josh: That’s the show. Thank you so, so much for joining us today. Conquering Chaos is brought to you by Parsable. If you’re a fan of these conversations, subscribe to the show and leave us a rating on Apple Podcast. Just tap the number of stars you think the show deserves. As always, feel free to share what’s top of mind for you, and who you think we should talk to next. Until then, talk soon. Take care, stay safe, and bye-bye.
[00:53:56] [END OF AUDIOListen to find out how company culture can be the key to making & sustaining change.