A leader’s handbook for managing culture

Win from within: Build organizational culture for competitive advantage

By James Hesket, Columbia Business School Publishing, 2022

It was one of the first business books I reviewed in 1992 Corporate culture and performance, By James Hesket and John Cotter, professors at Harvard Business School. A few books have explored organizational culture before, most notably In search of excellence, By Tom Peters and the late Robert Waterman, however Corporate culture and performance Was the first to try to measure the economic return of culture in a rigorous way. Thirty years later, Hesket, now 88, and Professor Emeritus, are still making business cases for corporate culture.

His new book, Victory from within, A master class in culture building. It’s a book you can read in a few hours and then apply throughout your leadership career – which goes to Hesket’s thesis: Most leaders don’t spend enough time managing their company culture and the time they spend is often wasted. .

Hesket pinned both problems to a flawed understanding of culture. “The strategy is difficult; Culture is soft, ”he writes,“ starting a list of common misconceptions. ”The impact of a strategy on growth and profitability can be measured, but not by a culture. If you get the key values ​​shared by everyone correctly, the rest will take care of itself A strong culture helps ensure good performance. It takes a long time to change the culture of an organization. All these claims have been passed in the management circles over the last few years. And they’re all wrong. “

Leaders who hate to embrace cultural change efforts (often because they believe they may not have enough time to complete the transformation) should pay attention to Hesket’s arguments. “Fundamental efforts to lead to significant change … must be completed within a reasonable time frame, often no more than twelve months,” he wrote. This does not mean that culture should be communicated in an ad hoc manner; In fact, “the work of rebuilding and perpetuating a culture never ends.” But it does mean that leaders can change and revive a culture that has tracked off fairly quickly, as Nadela did when he led Microsoft and John Ledger at T-Mobile. Hesket details a 14-point action plan to support leaders who set a six-month timeline to try it out for themselves.

If you are one of these leaders, Chapter 3, which describes how to create a solid, data-driven business case to garner support for culture change initiatives, may be particularly effective. “The purpose here is to explore the impact of culture on sales and profits – that is, by numbers,” Hesket explains. “It simply came to our notice then. In fact, one time may be enough to explain to employees from every department, department and functionality of the organization exactly how importantly culture contributes to their success as well as the success of the organization. “

There is no point in trying to create and maintain a competitive culture without the faith, enthusiasm and passion of a leader. ”

To make such a case, Hesket suggests measuring a number of key metrics that combine culture – with performance and profit expressed in employee and customer engagement. These are employee referrals, employee retention, labor return (productivity), customer referrals and customer retention. That’s not to say that culture can deliver solid, measurable contributions: Hesket believes that employee and customer engagement also strengthens innovation, but acknowledges that the evidence is limited. Nevertheless, he points to a study conducted by him and colleagues at Caesars Entertainment, which found that “Seven Star” offers more than twice as much product and service improvement as enrolled in customer loyalty programs (US $ 50,000-plus annually). “Gold” customer advice (মূল 2,000 in lifetime value).

Win from the insideContent is far more time consuming than content, but Hesket still provides readers with a short chapter on a topic that many leaders are considering these days — how to preserve culture and support employee engagement in the rapid growth of remote work. He looks at the experience of established all-remote companies such as Automatic and GitLab for concepts. And he sees that the leaders of such companies must “put extra effort into communicating across their organization, making sure that middle managers (the key to long-term success) are doing the same thing, gathering people on a face-to-face basis” over time, and sure Make sure workers who work remotely don’t ‘fall off the grid’ and get involved. “

Suitable for a guide to managing culture, Hesket closes the book with a chapter describing 12 personal behaviors for leaders. Live the culture, Hesket begins, pointing to Bill Marriott, who wants his hotel chain employees to think like owners — and models that behavior by picking up trash. Ensure fairness. Servant leadership practice. To be visible. The list goes on and on, but you’ve probably heard enough to know where it’s going: “It doesn’t make much sense to try to create and maintain a competitive culture without a leader’s faith, enthusiasm and passion,” Hesket wrote. Meaningful change, like so many, begins at the top.

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