Change management, Value management

What is corporate culture? How can you measure the culture of your company? How can you change your corporate culture? How to initiate a cultural change?

This article has three parts:

Corporate culture:
We answer all your questions about corporate culture, show you positive and negative examples of corporate cultures and how they affect the success of your company.
Cultural change:
What is cultural change and how does it work? What is a positive corporate culture and how do you get there? Where does cultural change often go wrong? What solutions are there?
Cultural Change Practice Guide:
11 steps on how to initiate and implement cultural change in your organization in a very practical way.

Let’s go!

Corporate culture: definition and examples

Corporate culture as a success factor

The terms corporate culture and cultural change are on everyone’s lips for a reason:

Karl, 53, Managing Director of automotive supplier Brumm (anonymized) is desperate:
“We come from a down-to-earth industry. But the market has changed completely in recent times: AI, networking data, modern technologies…”. Karl tells us how he recognized the signs of the times and tried to open up a new business segment… which unfortunately brought with it major, unexpected difficulties…

“The potential customers in the new business area tick completely differently: we now have to be quick and act proactively.” Karl has therefore completely redesigned many processes. He proudly explains that he was inspired by Scrum and design thinking: “We used to simply develop something and present it to the customer. But now we work together with the customer in a really modern way; we find solutions together. The customers like that.”

Actually exemplary. Karl has tackled the changes in the market. But this is causing trouble in the team and not just too little…. :
“What we didn’t expect was that our employees simply didn’t accept these new ways of working. At best, they grumble about it, but many reject it altogether.” And the worst thing:
“We have lost a number of employees and even two team leaders – really good people – because everything has become too fast for them.”
Karl shrugs his shoulders: “What am I supposed to do? We absolutely can’t carry on as before. The new business area is actually going quite well. But people are running away from me! New ones are hard to find…. Where am I supposed to start?”

A frequent cause of difficulties: the corporate culture

Our customer Karl acted in good time and implemented modern working methods, customer centricity and collaboration. But he literally did the math without the hosts: his employees. And if the people in the company don’t go along with it – no chance!

In short: the intention to change stumbles because of the corporate culture. Employees are used to other things and behave accordingly.

A team that functions optimally in what Karl calls the “down-to-earth area” does not necessarily work well in other areas.

A different mindset may be needed there; a different corporate culture would be helpful.

If everything has been organized in a rather conservative and manageable way so far, you can’t expect your team to make a 180° turn towards a start-up.

But: you can examine which corporate culture currently prevails in your company and which future culture would be appropriate for the new goals and requirements. And based on this information, you can shape a cultural change together WITH the people in your company. So that everyone is on board.

We’ll show you how.

Your advice on corporate culture – our offer >>>

Is corporate culture important for economic success?

Yes, but so much more!

Karl is not the only one to have experienced that corporate culture is critical to success. This has now been proven by studies:

In the study “Aligning Culture with the Bottom Line” conducted by Heidrick Consulting in 2023, 500 CEOs of corporations from nine countries were asked what they considered to be important for business success. 71% chose corporate culture as the number one success factor, ahead of “strategy” (66%) and “talent” (46%) and even far ahead of “digital transformation” (7%).

Why corporate culture is so important - the challenge of a VUCA world

Corporate culture trend

Until a few years ago, corporate culture was not an issue. Of course we were all concerned with good leadership and how to motivate employees. After all, it is obvious that the performance of individuals is the number one factor for the success of the company.

So how is it that the focus today is on organizational culture?

Is this a trend? No, not really. Companies deal with their culture out of necessity.

The VUCA world challenge

We’re all aware of it: times have changed. And that’s not all: they will continue to change in the future:

Digitalization, AI, globalization, technical disruption, Generation Z and demographic change, skills shortages, customers who expect immediate responses, new business models, the pandemic and wars. – External conditions are changing rapidly.

There is a term for these fast-paced changes and the associated unpredictability: VUCA.

VUCA is an acronym made up of the terms

Volatility/change
Uncertainty/uncertainty
Complexity
Ambiguity/ambiguity

We have already discussed the term VUCA in detail in our article Change management in our VUCA world: the success factors.

We show you how to deal well with the VUCA world!

Corporate culture and VUCA

When our environment changes, we as a company are required to react quickly. Why? In order to keep up and remain viable in the long term. We have seen that even market leaders like Nokia with a 50% market share were quickly out of the picture because they did not react quickly enough to change. Speed is one of the most important factors nowadays

when decisions have to be made quickly
when previously unknown challenges arise
if the course is not foreseeable and the circumstances are complex

But how does a company orient itself?

Especially when things have to be done quickly? What are employees guided by when they have to act but there are no guidelines? – No guidelines, because the situation that has arisen is not foreseeable and therefore cannot be planned in advance.

And very importantly:

Does the mindset of the people in the company support the required flexibility and speed of change?

Corporate culture plays a major role here:

If companies and employees are positively and constructively aligned, have a strong inner support and are guided by shared values, then they can react agilely and flexibly and remain capable of acting. The corporate culture points the way here, like an inner compass.

Corporate culture and skills shortage

Another important reason to look at your own corporate culture is the ever-increasing shortage of skilled workers. Most companies find that it is difficult and costly to replace employees who have left the company. It is more promising to invest in employee retention.

People rarely stay or leave because of salary levels or objective working conditions. Most resignations occur because people do not feel comfortable, do not feel seen, would like to be more involved or because the management is not right. These are all factors that have to do with corporate culture: Culture has a significant impact on employee satisfaction!

The culture of your company

What is it like in your company? How would you describe your culture? Have you already thought about the culture of your company? You should, it’s worth it!

Karl nods. He knows all about it: the changes that his company has to go along with, the employees who don’t want to and then leave. But he’s still not entirely convinced:

“Sounds great, but what actually is corporate culture? The term is incredibly vague. Everyone has a vague idea of what it might be: The manners? Colorful furnishings? Espresso or filter coffee? – Besides, everyone feels a little differently, don’t they? Isn’t it simply a question of sensitivities?”

How do you define corporate culture?

And how can the corporate culture in your own company be put into words? Words like “conservative, modern or open” do not do justice to a complex system like an organization!

Karl: “I need something solid to guide me! What defines corporate culture? And as an engineer, of course I’m interested: Are there parameters that can be used to measure corporate culture?”

Yes – measuring corporate culture is possible; there are tools for this, such as the ValueParty app. We’ll talk about that later. For now, let’s take a look at what constitutes a corporate culture and where we can perceive a company’s culture in everyday life.

Are you super curious about how to measure corporate culture? And would you like to get a small preview right now? Then watch our 3-minute video Transformation of your corporate culture: Measuring and shaping culture with the ValueParty app.

Shaping your culture? – Request advice >>>

The definition of corporate culture

What is corporate culture?

Finding a definition for corporate culture is no easy task. This is very similar to all other cultural concepts:

– For example, how do you define a country’s culture; what exactly constitutes it? You guessed it – it will be difficult to describe these exactly, because there are many factors that together form a culture.

What would you say makes Italian culture special?

The good food, the cheerful togetherness, the waving when speaking, the landscape, the music, the way people meet strangers, the fact that people like to travel in groups, attach importance to good clothing, laws, politics, the media, the language, family structures, the presence of the church, the mafia and so on and so forth.

As you can see, culture is a complex entity.

Definition of culture

The anthropologist Cecil Herman defined culture as a

“System of rules and habits that guide the coexistence and behavior of people.”

Definition of corporate culture

Corporate culture describes how companies are managed, decided, worked together and communicated with; which values, rules and structures prevail and how the company appears to the outside world.

Description of corporate culture

Corporate culture is the way people act in a company, the values on which this is based and how the company is perceived internally and externally.

How do employees meet each other, how do you approach customers, what is the relationship between management and employees like? Do you communicate casually or formally? Who gets to decide what? What is important? What values and mindsets are there? What is good manners and what are no gos? What are the unwritten rules?

How customers or business partners experience the company and how it feels from the inside, i.e. how employees experience the company, is also part of the corporate culture.

The people in the company usually feel the corporate culture rather unconsciously. The visible part of the corporate culture are the rules, processes, reward systems and the design of the rooms, workplaces and clothing.

A corporate culture develops over years.

Looking inwards

“I see,” says Karl, takes a sip of coffee and looks out of the window: “Let me try to describe our corporate culture. Above all, I realize that nobody wants to make decisions here. Because nobody wants to do anything wrong. Everyone protects themselves at the top, takes managers in CC. That’s exhausting for all of us and makes us really slow.” HR manager Andrea speaks up: “The mood is not good at the moment. Many feel that they are being treated badly and are somehow at the mercy of the managers. But they don’t want to take things into their own hands either. It’s supposed to come from the top. It’s a stalemate situation.” Karl: “Is that corporate culture or just our current problem? What’s it like in other companies?”

Examples of corporate culture

How does corporate culture manifest itself in everyday life? Each of us has experiences with different corporate cultures, here we want to show you some examples.

Examples of corporate culture from the outside

Every time we come into contact with a company, we experience its corporate culture:

There is damage to the product you have purchased and you have the warranty certificate with you…
- but none of the salespeople can help you. You first have to find the manager, who takes a long time to find before showing upstressed out.
- Or: someone will be put at your side to show you the options, find the best one for you and give you a small voucher.
In the garage
- everyone takes care of you, you get coffee in a waiting area with newspapers and your car is cleaned and returned to you. The staff are calm and friendly.
- Or: the master yells at his oil-smeared subordinates while you stand in the cold.
In the café
- you are greeted like a friend, the casually dressed staff joke with the guests and with each other.
- a waiter in uniform appears, addresses you politely and distantly as Sie and always says: “You’re welcome.”
The craftsmen will give you good advice and tips on how to avoid damage.
At the hairdressing salon, they roll their eyes when you ask for a spontaneous appointment and sternly point out that they’re finally off work.
In the furniture store, the sales assistants prefer to talk loudly to each other about disagreeable conditions and pay little attention to the questioning looks of the customers.

Karl looks at customer testimonials about his company. He talks to a customer friend. He leafs through brochures and plays fly on the wall during customer phone calls from his employees. He thinks that Brumm makes a very good, solid impression.

Examples of corporate culture from the inside

And especially when we work in a company, we feel the corporate culture there:

You need binding information, but no one wants to commit, remains vague and refers you to colleagues.
There are rules and regulations for everything and anything. This sometimes makes things very complicated, especially when a case arises for which no precise solution is prescribed.
Groups of people regularly gather in the corridor to vent their anger at the boss.
The colleagues get on well, and in summer we regularly have barbecues together.
You pay close attention to what you say, what you wear, what you do and when, because it’s better to be careful.
Everyone is working on their own career development, there is no mutual support.
There is open debate and philosophizing, including on topics such as society and social and political developments. The colleagues position themselves openly.
You find out in a roundabout way that a colleague has got married but hasn’t told anyone.
Everyone is energized and occasionally bumps into each other.
The staff stay longer, pizza and beer are ordered for everyone.

“Phew,” says Karl, “I can’t say too much about that. I’m usually sitting in my office or on the road. But my impression is that everyone always felt quite comfortable. Only now, suddenly, they don’t.” HR Andrea raises an eyebrow. “Well Karl, it’s been like this for a while! Have you ever looked at our kununu ratings?” Karl looks uncomprehending. Andrea: “They could be better. Young talent doesn’t want to join us because we’re too old-school and it’s all become too crazy for long-standing employees. An employee recently asked me why, after 18 years, she suddenly has to decide things that were previously clearly regulated. She wouldn’t go along with that.”

Our book on corporate culture

Did we mention that we have written a book on the subject of corporate culture? – Published by FAZ Verlag. If you are interested in the book, please click on the picture for more information.

In the video, we talk about the background, content and genesis of our book. 15 min.

The 8 factors of corporate culture

What is part of a corporate culture?

A corporate culture is made up of 8 factors:

Behavior, rules, rituals
Symbols, working environment
Power, decision, responsibility
Organizational form – Processes
Underlying values
Reward systems
Type of communication

And who else is part of it? We are!

The 8 elements of corporate culture in your company

Let’s go back to your company: What is the prevailing organizational culture there? What do you think of a little analysis? Let’s go into the details.

How do you analyze a corporate culture?

Detailed questions on the 8 factors of corporate culture provide a meaningful picture for a first impression.

Measuring the corporate culture comes later.

Corporate culture factor 1: Behavior, rules, rituals

How do people treat each other?

Do you shake hands in the morning? Does everyone go to their workplace in silence? Do you greet each other cheerfully or just nod?
Do you discuss to find a solution or do you wait to see what the boss will say?
Do you eat at work or is it taboo?
How do colleagues react when someone puts their feet up on the table?
Do you laugh often and loudly or is it more appropriate to keep quiet? And what do you laugh about?
Do you behave casually, like friends, or are you more formally correct? Is your interaction rough and ready or rather sensitive?
Do your colleagues like to eat together or does everyone prefer to eat for themselves?
How are diverse life forms, cultures etc. received? Integrated or ignored?
Is there an occasional after-work beer together?
Do colleagues know about each other’s private lives?
Birthdays: Does the colleague have to bring a cake, does the team bring something, does everyone take a short time or is the birthday ignored?
Do you support each other or does everyone see how they get on?
If you want to visit the colleague, do you knock or just show up?
Do employees enjoy going to the Christmas party or is it compulsory?
What routines and habits are there?
How is it dealt with when someone behaves abusively? For example, are sexist jokes ignored, commented on, criticized, discussed or laughed at?

Corporate culture Factor 2: Symbols, working environment

How is the working environment structured?

Is the workplace open and therefore conducive to cooperation?

Are the premises large or small, are there individual or team offices? Or maybe even an open-plan office?
Are the desks permanently assigned or can they be used flexibly?
Are there common rooms or space for coworking?
Are there visual walls on which you work together, such as Kanban boards?
Does the company have a coffee spot where you can chat? Or is there just a dark corner?

What is the setup like?

Rather colorful or rather stiff?
Is there the normal office furniture or is there a hammock hanging somewhere?
Does the furnishing consist of designer furniture or what was just at hand?
Is every room the same or are there differences?
Is the workplace changed from time to time or does everyone stay in their place for years?

What symbols and status symbols are there?

Is the computer a status symbol? Or the company car?
Do the floor and size of the office indicate the status?
Do you have iPhones?
Are there executive parking spaces?
Do you wear a tie? Or do you come to work fashionably casual?
Is the clothing more business-like or does everyone show off their own style?
Is there an espresso machine model professional barista or a decrepit filter coffee machine?
Does the company provide organic teas or does everyone bring what they need?
Do you value sustainable, fair consumer goods or is cheap the trump card?

Corporate culture Factor 3: Power, decision, responsibility

This is about the type of leadership.

How are decisions made?

Are decisions made jointly?
Does the management involve the employees? Or does it issue instructions from above with no alternative?
Does the team decide? If so, then how? Do you discuss until you reach a consensus? Or does a consensus rule apply?
Can employees make independent decisions without hedging their bets?
Do people have the courage and desire to make decisions or do they tend to avoid them?
Are decisions made quickly, or is there a plethora of decisions that drag on and thus hinder processes?

How is budget responsibility distributed?

Do employees have little say in the matter or are they allowed to decide on everything that affects their area of work?
Do they get a leap of faith in the form of a company credit card or a budget, or does everything have to be applied for down to the cent?

What is the management’s attitude towards employees?

Is it the task of the management to check compliance with the instructions given?
Or are they more there to support employees in carrying out their tasks?
Is leadership a coordination task among other tasks at eye level or is leadership “something better”?
What do you trust your employees to do?
How much respect is shown to managers? Are you on first or last name terms with the managers in the company?

Corporate culture Factor 4: Organizational form – processes

What form of organization does your company have?

Is your company more of a classic line organization?
Or rather a team structure?
Are there several people who have a say in a decision (matrix organization) or just one manager who is responsible for one topic?
Do you have a flat hierarchy or are there many levels of management?
Are there squads in which some topics are organized outside the hierarchy?
How high is the proportion of self-organized teams in the company? Is there such a thing as holocracy in your company?

What structures and processes are in place?

Is project management organized and delegated a la waterfall?
Or do you work with methods such as Scrum?
How much self-organization are employees allowed?
Are processes firmly defined and must they be strictly adhered to?
Or are there flexible, changing structures or perhaps even chaos?

Corporate culture Factor 5: Underlying values

People – and companies – live by different values. For one, it is important to earn a lot, while the other values a harmonious team. Values determine the actions of every person in the company, and therefore the various aspects of the corporate culture.

Examples of how values influence culture:

How do you deal with performance?

Does it rather mean: individual performance counts, the best is rewarded with us?
Do you want to outdo the other? Or are you more team-oriented?
Everyone should feel comfortable and motivated to work?

How do you deal with mistakes?

Are they punished and do employees have to fear negative consequences?
Or are mistakes welcomed as an opportunity to learn from them?
Are employees willing to take risks and dare to explore new territory?
Do they come up with new ideas?
Or do they prefer to stick to tried and tested paths and stick to what is safe?

How do you deal with rules?

Are rules followed unquestioningly because nobody dares to question them?
Or are they rather an orientation for one’s own actions and can be put to the test?

The topics of values and value management in companies are very close to our hearts. That is why we have already written several articles on this subject. If you would like to read more about values:

Corporate culture Factor 6: Reward systems

Reward systems are very important foundations for the culture of a company. This determines who is committed to what, and thus the direction of the company.

Who will be rewarded?

Do all employees share in the company’s success?
Or does everyone receive their salary, regardless of whether they are successful or not?
Are perhaps only some groups of people rewarded (e.g. sales) and others not (e.g. sales assistance)?

What is rewarded?

Are there individual target agreements?
And are individual performances rewarded accordingly?
Is everyone committed to reaping the rewards themselves without sharing?
Or is there a team pot and joint achievements are rewarded?
Is the reward based on the target agreements or is the overall success measured?

Which unit do the reward systems relate to?

Are employees involved in the success of their company?
Or just the success of your own team, unit, division…?
Or just their own success?

How flexible are the reward systems when goals change?

Will the specifications be discussed on an annual basis?
Or you reorient yourself at short intervals (as with “OKR lenses & key results”)

Corporate culture Factor 7: Type of communication

An important factor in dealing with one another – and therefore in culture – is of course communication.

Official communication

Here you look at how the company communicates officially:

Does communication adhere to hierarchies or is there direct communication across departments?
Do you tend to write e-mails or do you discuss things at meetings?
If there are meetings – what kind of meetings are there?
Daily, short meetings similar to Daily Scrum Standup Meetings or is the tendency more towards monthly reports?
Or does communication tend to be omitted due to time constraints?
Do meetings tend to be formal one-way presentations or is a dialog encouraged?

Unofficial communication
– How do colleagues talk to each other?

And of course, unofficial communication is also important:
Do you use the you or the you-form?
Do you communicate in a formal, stiff or casual manner?
Are you more level-headed or do you not mince your words?
Do you attach importance to an educated way of speaking or do you speak as you please?
What is the tone of voice? Open or sharp?
Are conflicts addressed or do people prefer to keep their worries to themselves?
When colleagues tease each other, is that fraternal or do tips sound out?

Corporate culture factor 8: Stories

What stories are told in the company?
What legends are being created?

Do you tell each other the founding stories, the stories from the early days?
And what does that say about the company?
Is the tenor more “everything used to be better”?
Or are the obstacles that the founders have overcome admired?
How do you talk about great successes or failures?
Do the stories emphasize the “we”?
Or are individuals being exposed?
Do you speak disapprovingly of colleagues or do you appreciate their skills?

The problem of corporate culture: When corporate culture puts the brakes on…

A company thrives on satisfied customers who like to come back. In times of digitalization and permanent availability, customer demands have changed: If a customer makes an inquiry, there is no longer time to pass it through several hierarchical levels and ensure it is dealt with. Unfortunately, this is still the case in most companies.

This is frustrating for everyone involved.

Example of problematic corporate culture

Karl’s employee Anja responded quickly to the customer’s request and prepared a quote, but had to wait for the green light from her line manager Brigitte. Brigitte would have liked to get the job, but was busy elsewhere and couldn’t deal with the matter until much later. The customer is annoyed that he has had to wait so long – and places the order with the competition, simply because they can react more quickly.

If Anja had been trusted and given the authority to submit the offer without higher-level control, the order might have been completed. Because Anja could have acted quickly.

However, this approach requires an organizational and management culture based on trust.

As you can see, the culture of a company is a success factor and, of course, a corporate culture can also seriously hinder the success of an organization.

Three types of negative corporate culture

We present you with three examples from our practical experience that show just how protracted it is for companies to get in their own way with their culture. – And how little half-hearted measures can do about it.

Corporate culture consulting – your free initial consultation >>>

1. the culture of fear – better not to make any mistakes!

Our example

A medium-sized mechanical engineering company with 1000 employees in Baden Württemberg (anonymized).

The company wants to position itself globally, strengthen its subsidiaries and the slow development department and become more innovative and dynamic overall.

The history of corporate culture

Until eleven years ago, this company was ruled by Hartmut, a managing director with an extremely choleric disposition. Hartmut was unpredictable: one day he was in a great mood and relaxed, but the next day he could be in an equally bad mood and put his employees down. It also happened that employees talked to him over a glass of wine in the evening – and were fired without notice the next day. If you were open with Hartmut, it could be that he suddenly treated you like his best friend – or that he completely lost your trust and the employee became persona non grata.

Hartmut often reacted very harshly, but nobody knew exactly what he was reacting to. It was not clear what they had said or done wrong. And of course, the desire to speak to the unpredictable boss about it was quite low. It was better to keep your head down, remain inconspicuous, keep a low profile and avoid offending anyone.

Hartmut, the uncomfortable managing director, had already left the company eleven years ago, but a culture of fear continued to prevail in the company over the years. Older managers were particularly affected by this; they found it very difficult to make decisions. The employees protected themselves and were suspicious. Of course, new ideas were not expressed very openly, because you never knew whether you might get a rope twisted out of them….

The change – and how the corporate culture has nevertheless been preserved

Employees who brought a breath of fresh air were not accepted by the team and left the company after a short time:

There were unspoken rules in the company: Everyone had to shake hands when greeting each other in the morning. Even though they had been working together for 20 years, they never stopped addressing each other as “you”. If you were at an event in the evening, employees were only allowed to go to bed when the boss had given permission or when he himself had retired. And the rest of everyday life in the company was very similar: the boss was like a father who everyone asked whether he was allowed to do something or not. Nothing was decided without him.

The new one

When Moritz, 30, who had previously worked for a young, dynamic and innovative company, joined the team, the different cultures clashed harshly: Moritz confidently expressed his ideas, worked and made decisions independently – and, to everyone’s indignation, only threw a “Hi!” to his colleagues in the morning before setting to work. This behavior gave the team the feeling “He doesn’t fit in with us!”, “But he’s rude.”, “He’s such an individualist who just does his own thing and doesn’t talk to anyone.” His colleagues were not stingy in making Moritz feel the unease they felt towards him. – And so Moritz left the company after just 2 months, as he didn’t feel comfortable either.

Bosses leave – the corporate culture stays

The anxious organizational culture remained – among other things – through recruiting: People were hired who fit the existing, fearful culture. The culture continued, even though the company actually wanted to develop in an innovative, dynamic direction – but new, different employees, who would have brought precisely this fresh impetus to the company, were thwarted by the existing corporate culture. The company had become bogged down.

2. the bureaucratic corporate culture – order is a must

Our example

A global company that has achieved a worldwide reputation for quality “Made in Germany” in the technical sector and has been successful on the market for almost a century.

The history of corporate culture

Quality was and is a very important asset in this Group. And to ensure that quality remained at a consistently high level throughout the Group, the main departments took the trouble to record the extremely extensive processes in manuals for colleagues and posterity. There was a process for every operation and a checklist for every process.

What else could go wrong? All you had to do was adhere exactly to the specifications. And that’s why it was frowned upon not to do so: If an employee did not adhere to the process, they were at the bottom of the pile, were no longer welcome and, to make matters worse, were subject to disciplinary measures. This made it much more attractive to carry out what was in the manual than to follow your own, possibly new thoughts and paths. Because such creativity entails high risks.

The long official channels

Of course, decision-making powers were also regulated in detail, sometimes down to the cent: even if an employee only wanted to buy a box of cookies for an event, they had to get their supervisor’s signature. If the amount was slightly higher, a completely different set of rules had to be applied: In this case, the signature of the division manager was also required.

The employees decided nothing on their own and always followed the official channels. – After all, there has to be order. That’s why there was no cross-functional collaboration in which everyone could have exchanged ideas with everyone else across departments. No, communication was based on the line principle: the employee had to report to their manager, who spoke to the manager of another area, who in turn passed on the results to their employees according to the silent post principle. There was no direct communication between employees from different areas, as this would have been difficult to control.

The change – and how the corporate culture has nevertheless been preserved

Like so many others, the Group realized that it had arrived in the new era, the era of VUCA. And of course he wanted to position himself well for this and completely change his approach: The Group now needed to be fast and flexible – and also creative.

Measures that seemed suitable included streamlining or even eliminating processes, increasing the scope for decision-making and supporting cross-functional collaboration. As moral support, the employees were assured that there was now also a culture of error, that mistakes were welcome and that it was okay to try things out. So far so good.

The result? You’ve probably already guessed it: nothing, nada, niente.

Because the proclaimed “new culture” was not lived. The managers were still the same. They nodded through the new guidelines, but carried on as before: if errors occurred, they did not hold back on criticism and kept the scope for decision-making to a minimum to be on the safe side. And the employees also played it safe and preferred to stick to familiar routines: they followed the processes exactly and continued to ask their bosses to make sure.

These new values and procedures have been proclaimed for 5 years now, but the topics of freedom, speed and creativity simply do not want to gain a foothold. The old management style remains, the old culture persists.

In the meantime, the share price also reflects the fact that the Group is no longer one of the world’s top players. The competition from China and the USA is dominant. They are faster and less bureaucratic there. And the customer does not reward the higher, but old-fashioned quality when he can have cheaper, more innovative offers.

3. the culture of competition – one against all

Our example

A sales organization

The history of corporate culture

Previously, this sales organization rewarded lone wolf behavior: The best salesperson was recognized, individual target agreements were made, each salesperson sold on their own, because if they joined forces, they would have to share the commission. There was extreme competition among the employees: who would make the deal? When competition arose, there was a lot of jostling in the shark tank. The management had no intention of stopping this – on the contrary – they tolerated and encouraged this behavior with a slight smile. After all, competition encourages ambition – and competition stimulates business, doesn’t it?

If someone sold well, he was the star and could take it all for himself; if he broke the rules and misbehaved, he still didn’t have to fear any sanctions; after all, he was who he was. Ergo: You simply have to assert yourself against the others by all means, then it will work.

The change and how the corporate culture has nevertheless

What happened was that the world of this company changed dramatically. The business became more global: whereas it had previously been a national player with nationally operating sales staff, the business now became international and required international cooperation. It could happen, for example, that a client from London wanted to realize large projects in Berlin, Paris or New York. And the deals have also become larger, more complex and require more explanation. Instead of just selling, the salespeople were often expected to provide a whole host of consulting services to accompany the projects

It was no longer enough for one salesperson to handle a tender alone: They had to work together across regions and also by using different skills in order to keep up with the competition. This was no easy task, as the employees were not exactly known for their teamwork.

Other companies had already managed this well before: They had put together international teams with different skills. But in this company, strangely enough, it just wouldn’t work. The management never tired of preaching “Just work together! Why don’t you set up national teams?”

The winner takes it all

However, the salespeople, whose core competence was to achieve their victories alone, found it difficult. They knew from experience that if you wanted to emerge from a challenge as a hero, you had to muster the necessary skills all by yourself, keep your information to yourself and not share too much else. The salespeople continued to pursue this kind of non-collaboration. In this way, individual employees had previously been able to win in internal company competition, but the company failed in international competition.

The efforts of the managers remained half-hearted and the reward system was not changed because they did not want to offend the stars. After all, they were the ones who were successful on the domestic market. What if they worked less well or even left the company? A team commission would certainly lead to losses for the top salespeople, and these star salespeople in particular loved the feeling of being able to do whatever they wanted without restrictions. No, we didn’t want to use this as a way of controlling them, we preferred to give them as much freedom as possible. The employees used this freedom to consistently fail to implement the new working methods. As the employees did not change anything voluntarily and there was no directive, they continued to try to survive in the new world the old way. Of course that didn’t work…

Cultural Change - The cultural change in the company

Cultural change – cultural change in the company

Why corporate culture is so difficult to change

Our examples have shown this: The corporate culture cannot simply be changed with a few workshops and instructions. Culture is very deeply rooted. And old habits or what people regard as right or wrong behavior, as polite or rude, as valuable or unattractive, cannot simply be changed. An old corporate culture is stubborn and usually finds ways to perpetuate itself. Many organizations have already experienced this.

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They say:

A new strategy is implemented in 100 days
A new structure (e.g. an agile structure) is established in one year
It takes at least five years to develop a new corporate culture! And – as in our example above – it can take even longer.

But of course you can also influence this. The more consistently you think about the cultural issues that form the basis for every change, the faster things will change in your company. It is therefore necessary to make comprehensive, far-reaching changes in many areas of the company at the same time. As we have seen, an organizational culture encompasses many factors. On the other hand, this must not happen haphazardly, so that valuable features of the old culture can be preserved.

What is a good corporate culture?

A corporate culture is good if it suits the employees and the challenges in the corporate environment, i.e. the market, customers, developments and so on.

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A corporate culture that employees reject cannot work! And a culture that works against the current situation of the company deprives it of its foundations. This means that in order to be successful, the corporate culture must bring the outside (corporate environment) and the inside (team) into balance!

Agile corporate culture

Does every company need an agile organizational culture? A clear no!

In recent years, we have noticed that many companies are facing similar challenges due to VUCA and permanent change: namely becoming faster, more agile, more creative and more digital. This is currently an issue for many organizations in our part of the world; a transition in corporate culture is taking place in many places.

If you also have to face these challenges, then a positive corporate culture, i.e. a “we” culture and team culture, is helpful.

We will come back to this type of challenge and the we-centered culture that is helpful for it in a moment and show solutions for the examples of corporate culture just described (fear culture, bureaucratic culture and competitive culture).

Corporate culture in classically managed organizations

But not every company faces these challenges.

If the organization operates in a stable market that is highly regulated, for example, and only changes slowly, then agility is not necessary. Take a public authority, for example: Nobody needs to be agile or creative here and discuss new ideas. It’s all about working through existing processes. And the people who work there are there to do just that.

Another example: we advised an international company. One of the production sites was in Brazil. As we quickly realized, leadership here was relatively conservative. And not just among the managers; the employees also insisted on leadership that clearly told them where to go. The production process was not very complex; there were recurring tasks. There was no need for creative contributions from employees and they would not have been willing to do so. Establishing a “we” culture with flat hierarchies would have turned everything on its head: some machismo was expected from the management. Without this, managers would no longer have been taken seriously. In this case, softening the authority of the management would have made the company less successful.

What corporate culture does your company need?

The corporate culture is the personality of your company, so to speak. With all its advantages, virtues and also quirks and difficulties. And just like personalities, every corporate culture is very individual.

In this respect, it is worth taking a closer look at each individual: What is your current corporate culture like? Where are you right now? And: What does your company need to be successful in all circumstances? And with this map – where are we and where do we want to go? – is the most sensible and effective way to work.

Even and especially if you want to establish a “we” culture, a team culture in your company, you need clear information on the current and target status of your corporate culture.

What is the best way to optimize corporate culture?

The quickest and most effective way to optimize your company’s culture so that it is ideally positioned for employees and external conditions is to

Measuring corporate culture
Create target image for future organizational culture
Discuss and draw conclusions.

We explain the individual steps for cultural change in detail at the end of this article in the 11 steps to cultural change.

In the video Transforming corporate culture with the ValueParty , we show you in 3.5 minutes how you can measure your corporate culture using an app.

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Which corporate culture suits the VUCA world?

We have already mentioned this above: we often face similar challenges in companies. Companies are confronted with rapid change and uncertainty and have to prepare for it. In most cases, this doesn’t happen quickly and smoothly. That’s why we want to take a look at what has been common practice in many organizations so far.

Traditional corporate culture: command & control culture

Previously, it was important for employees to follow rules, maintain order, secure success for themselves and avoid mistakes. The management set guidelines and at the same time acted as a supervisory body. In such a regimented environment, a person naturally feels externally determined – they act out of necessity rather than motivation.

In many companies, employees are hired like mercenaries: “I get paid so much money and that’s what I put in.” Sometimes there is also commission, then you work a little more because there is also more money. But – it’s about the money. And only that.

It is not about a vision, an idea or even about the company itself. You see yourself as “bought in for other people’s purposes” and the company is experienced as a foreign entity with which you interact in order to make a living. Sometimes the fear factor even plays a role: the employee performs because he is afraid that otherwise something bad will happen: Threats of consequences, promotion freeze, dismissal.

But joy, pleasure and motivation are rarely to be found in such contexts – and no commitment that goes beyond the filthy lucre.

Modern corporate culture: we culture and team culture

There are organizations, such as associations, where there is not even money involved, but where people still put in work, time and energy because they enjoy doing it: Because they consider it meaningful, because they enjoy it, because they see themselves as belonging and have common goals.

Wouldn’t it be great for employees if they went to work feeling just like that? And wouldn’t it be an incredible benefit for companies to have such motivated employees? – If the entire workforce went to work with the feeling: “We’re passionate about the same thing, we really want to do it – and we’re all pulling in the same direction!” – That would be a real win-win.

This does not have to be a utopia! The basis is to create a corporate culture in which the company and its employees see a sense of purpose in the company’s success and everyone is committed to it. We refer to this attitude as a “we culture” or team culture.

Mindset: We solutions (Welutions)

We believe that we-oriented action is the basis of a positive corporate culture.

What’s more, we believe that we-solutions (Welutions) are the prerequisite for agile action and long-term survival in our VUCA world.

We-solutions are the individual actions and regulations that are based on a we-oriented mindset and together create a positive corporate culture.

A Welution is a solution, an approach that benefits everyone: Myself, my colleagues, the customers, the suppliers, the entire system – and ideally the world around it. In short: a win-win-win-win solution.

Why we-orientation?

Ultimately, it’s about everyone pulling together with combined strength and expertise. The more people with different perspectives act proactively in the interests of the company instead of just for their own benefit, the better the company is positioned when it comes to change. Because finding solutions to changes and challenges is no longer just the responsibility of the boss, but a concern for everyone.

This is an inner attitude that suits the modern, complex and networked world.

Welutions instead of Solutions – The difference

Until now, many organizations have had solutions, i.e. solo solutions. What is the difference to Welutions? Here are a few examples:

One solution, for example, would be individual commissions in sales – where a single person benefits from their success. A worldution to this would be a team pot, through which a whole team is interested in making the deal.
A solution is when the boss decides. The opinion of the team is very important in a Welution. The team is involved in decision-making processes and decisions are made together. This way, everyone knows the factors that underlie decisions and can stand behind them instead of having them imposed on them from above.
In the case of special achievements, one solution would be to highlight the performance of individuals; another is to honor the team performance, mention everyone and show everyone that they are part of this performance and are valued.
One solution is to push the supplier and try to get the most for yourself. A worldution focuses on good cooperation: What does the supplier need to do a good job, have satisfied employees and remain sustainable?
One solution is to blame individuals for a failure. One world solution is to recognize that in today’s complex world, success or failure is usually the result of an interplay of many different factors, so we can only look together at “How can we do better?”

If you would like to learn more about VUCA, we provide 10 tips in our detailed 9-minute video.

The principles of a positive corporate culture

What makes a strong corporate culture?

Reward systems, decision-making powers and the opportunity to contribute creatively are the regulations that make a positive corporate culture possible – or not. You can set the course here. You’ve seen it in our examples: What’s the point of shouting “Work together!” if only one person ends up raking in the profits? And why contribute your ideas if you might end up getting a slap on the wrist?

Principle 1: Shared reward

One of the most important foundations for how the corporate culture is aligned is the reward system: if you agree individual goals with your employees that are possibly even a little contradictory, then everyone will want to pull in the direction that is good for them – and you will hardly manage to establish a “we” culture in your company. In today’s fast-changing world, there is also a risk with individual targets on an annual basis that the targets will no longer fit when the year is not yet over. How often do employees do something just because it’s in the target agreement, even though the world has changed and the measure no longer makes sense?

Reward systems for a positive corporate culture

You have a car dealership with a service department/workshop. If you reward the service department for doing a lot of repairs, then the service department will probably recommend a repair even if a car is no longer really worth repairing, but sales would need a hint to have a conversation with the customer about a new car. This type of reward system lets either service or sales do the business, which leads to both competing against each other instead of pursuing a goal together.

However, if you involve all employees in the overall success, everyone will do what benefits the dealership the most. This is the foundation for a “we”.

A target agreement should ensure that people see a benefit in working hand in hand! This is given, for example, by a profit share that relates to a unit that is small enough for the employee to feel that they can influence it, but large enough that everyone who should work together to achieve this profit has the same target agreement.

In a car dealership, this can be the success of the company as a whole. In a global corporation, employees do not feel able to significantly influence the overall success. Smaller units are needed. With this type of target agreement, your employees know that they will participate in some way in the joint result and therefore in the joint success. – And they can help shape what the result looks like by working well with their colleagues.

Principle 2: Joint decisions or “radically decentralized”

In conservative systems, decisions are often made as follows: the manager decides and the employees implement this decision. However, this type of decision-making is now not very useful because, on the one hand, the people on the ground often know best what is needed and, on the other hand, the boss’s announcement is not very suitable for keeping creative young people in the company. But what can a new, we-oriented path to optimal decisions look like?

For a positive corporate culture: Give scope for action!

The manager – if there is one at all and the decision is not made jointly by a team – should sit down with the employees and define a scope of action with them. This should be broad enough to allow employees to complete their tasks without having to ask anyone.

In the case of overarching topics, the decision should be made jointly in the team or with all those involved.

For a positive corporate culture: find a decision-making mode!

However, a “joint decision” does not necessarily mean that a consensus is required, i.e. that discussions are held until everyone agrees. It is important that there is a clearly defined decision-making mode in the team. These can be different types of voting, such as a majority decision or a consensus.

Consent

Consensus is a very exciting form of decision-making from holacracy: If an employee makes a suggestion, the team must implement the decision unless someone has good arguments as to why this idea should not be pursued. In these fast-moving times, this increases the organization’s speed and ability to act.

Whatever form of decision-making is used in your organization, it is important that everyone in the team has the opportunity to contribute their information, ideas and opinions.

Why is this so important?

Of course, a sense of belonging and co-determination is essential for a “we” culture. It is also beneficial to the work if everyone can understand why a decision was made this way and not otherwise and if the decision is perceived as fair by everyone; because even if one’s own point of view may not have prevailed, it has still been taken into consideration. On top of that, there are very practical arguments: employees who work close to the market, i.e. close to the customer, have the best information – and this should definitely be taken into account when making a decision.

Principle 3: Innovating together – creativity in a team

Being creative together as a team is conducive to a sense of unity throughout the organization and thus to a team-oriented corporate culture. This also strengthens the company’s ability to innovate. Team here does not mean the traditional team, which is also an organizational form, but rather bringing together different people from all areas in non-hierarchical teams. This can happen in so-called squads, a temporary form of organization outside the actual hierarchy, but also in other agile forms of work, such as design sprints, in which new ideas are developed in a team in a short period of time (hence sprint).

Diversity creates culture

The creative process is usually most fruitful when you bring together as many different disciplines, departments and characters as possible. Make sure that the people involved know each other, can assess each other and, ideally, have already worked together and trust each other.

Why is trust so important here? As described in detail in our article Team development: How a group becomes a team, newly formed groups tend to remain polite at first and filter their opinions heavily. – But if not everyone contributes their ideas and views openly, then teamwork is no better than working alone.

Culture - Innovating together: creativity in a team

Positive corporate culture in practice

What would be we-oriented solutions – for the problems of the three companies in our examples? What steps need to be taken to achieve a positive corporate culture?

1. cultural change out of a culture of fear

Creativity instead of fear – just give it a try

The counterpart to the culture of fear from the medium-sized company mentioned above is a culture of doing, of trying things out:

Managers involve employees in topics and processes and they have ideas and implement them independently. When it comes to creativity and experimentation, employees receive full support from managers, for example by rewarding activity instead of punishing mistakes.

Error culture

A clear sign of this is to celebrate mistakes. What can this look like?

In some companies, mistakes are pitched and celebrated as lessons learned. Many companies are already doing this.

However, the reality of most companies is still miles away from this “we” solution. Implementing a new culture is a long-term process. Later on, we will discuss the specific steps you can take to gradually change the culture of your organization in the direction of precisely the corporate culture that your employees and your company need.

Practice Welutions we-oriented solutions

2. cultural change from a bureaucratic culture

Lean processes instead of paper wars

Here, too, it is important to promote independent thinking and action: instead of micromanagement and process specifications down to the smallest detail, it is necessary to significantly increase the scope for decision-making at the grassroots level. For managers, this means leaving decisions to employees even if they try to delegate decisions upwards out of old habit.

Above all, the aim here is to eliminate or at least significantly streamline processes.

Ideally, employees should do this themselves:

In working groups, they work together to adapt processes to actual needs, redefine them and discard unnecessary requirements. This process optimization should remain a permanent task for the employees.

Management responsibility

The task of management is only to ensure that this optimization process gets and stays in motion. It is best for managers to interfere little in the way processes are changed, as employees know best what they need to do their jobs well. By actively shaping processes together, ideally across hierarchies and departments, new forms of collaboration are also created.

However, it will not be possible to take them all with us, as some will not change after years of bureaucratic thinking and action.

Corporate culture change for competitive culture

3. cultural change from a competitive culture

All for one goal, instead of everyone for their own goal

The employees of the sales organization first need a common goal and a common reward, such as a team commission.

The cooperation of several people on one goal probably has to be instructed in this organization first. This is exciting – because in the long term, we want to move away from top-down instructions in a “we” culture. However, there are cases where an instruction is necessary as a start pulse, as otherwise nothing would change.

(There are parallels here with the women’s quota: a new culture can only establish itself with a clear guideline. Because if there is no clear impetus, everything remains unchanged in the old culture).

Choose methods that fit the current value system!

A value profile based on Clare Graves’ Spiral Dynamics model, which you can create using the ValueParty app, will help you to identify the best methods for driving cultural change:

An organization always responds best to the methods that fit into the value system in which it now finds itself!

At this point, we would like to refer you once again to our articles on the topics of values, the Spiral Dynamics model and Clare Graves:

Video Shaping value change: The path to the right corporate culture

In the video you can see how we have shaped a change in values and culture online. In 11 minutes, we explain how such a process works. And what the background is.

Good news: with the ValueParty app, a tool has been added after the video was created that makes measuring corporate culture child’s play. All employees in the company can be surveyed simply by cell phone.

10 cultural change tips:
How to optimize corporate culture through cultural change

Now that we have dealt in detail with what corporate culture is, where it manifests itself and how it can have an impact; what “we” culture is and how it can be lived, we would like to give you some practical tips on how you can gradually initiate cultural change in your organization.

Cultural Change Step 1:
Get top management on board!

A change in your corporate culture can only work if top management is behind it. Unfortunately, change processes that are controlled by the HR department, the IT department or elsewhere in an attempt to change the corporate culture in a guerrilla manner or simply introduce digitalization do not work! Even if top management torpedoes changes, they are doomed to failure. So your first step should be to get top management on board, because you and your team will need their full support the whole time.

How can you tackle this?

In our work, it has proven successful to organize a workshop with the entire management team before the official start of the process. In this way, we achieve commitment and create an understanding of what this new culture actually is. Because understanding this process of change and its necessity on a cognitive level does not yet mean having understood it emotionally or even living the change.

If the existing culture has been influenced by the current management, then the work with the top management is particularly intensive, because then a real change involves the willingness of every manager to change. This requires an enormous amount of insight on the part of the leadership and an equally great determination to really act differently in the future, otherwise hardly anything will change. A change in leadership is usually the easier option. But we have also experienced the other way.

Cultural change Involving management and executives

Cultural Change Step 2: Involve and win over
people – take off together

Employees are involved from the outset in order to make them participants and contributors. This strengthens commitment and acceptance in the change process. The reason for embarking on the journey is explained in a kick-off with all employees. Only when people understand the WHY are they willing to join the journey. This works well, for example, with the help of a town hall meeting at which top management describes the company’s situation and the urgency of a cultural change.

It is also a success factor in the further course of cultural change if it is possible to involve all colleagues so that every person in the company feels that their opinion is in demand and that they have the opportunity to help shape the cultural change. You can find out how in the next few points.

Cultural Change Step 3: Measure
corporate culture, derive direction of change and develop target image

Peter Drucke, management guru from the very beginning, has already said:

“If you can’t measure it, you can’t improve it”.

We can only change a culture in a meaningful way if we know where we are now and where we want to go. A central component of a successful value-based transformation is to understand the existing corporate culture in detail, derive a clear direction for change and develop a coherent target image.

1. measure corporate culture: Create a value profile!

To map your corporate culture, you can create a value profile together with everyone in the organization. This will map both the current culture and the desired or required culture. A corporate culture is helpful if the people in the organization feel comfortable with it and if it supports the organization in overcoming current and future challenges. With a value profile, you can see to what extent these conditions are met and where action needs to be taken.

You can find out how to create a value profile in our article Creating a value profile. We explain the process in detail in the videos on the ValueParty app here in the blog post.

The aim of a value profile is to develop a shared understanding of where you are and where you want to go. A precise analysis of the current culture is essential in order to recognize which values are really lived and where there may be discrepancies between the actual and the target.

2. cultural analysis: deriving the direction of change

A detailed cultural analysis is carried out on the basis of the values profile. This involves examining how the existing values are implemented in day-to-day work processes and in our interactions with one another. Cultural patterns and behaviors are identified that are either conducive or obstructive to the desired change. The needs and expectations of employees are also taken into account. The analysis helps to derive a direction for change: Which values and behaviors should be strengthened, which should be weakened or changed?

3. define target image or mission statement and create value compass

In the next step, representatives of the employees and managers develop a clearly formulated vision (or mission statement). This mission statement describes the desired corporate culture and the associated values and behaviors in the sense of a value compass. The aim is to paint an inspiring and motivating picture of the future organization. The mission statement serves as an orientation and gives all people in the organization a clear direction. It is a kind of “guide” for everyday life and helps to make decisions in line with the new values.

Cultural change step 4:
Take all managers on board

Once the mission statement has been developed, the next step is to bring it to life with the people in the company.

The involvement of managers in particular is crucial in a cultural change. After all, it is the managers who have a decisive influence on the culture of an organization, each in their own area. This means that the actions of the top manager influence everyone who works under them and each manager influences their own area. So the lower down an employee is employed, the more management is above them and has an impact on their area.

This can be compared to colors that mix: each manager brings in their own color and ultimately everything is dipped in a certain shade from the very top. This visual representation shows that cultural work requires very intensive work with all managers.

What can working with managers look like?

Cultural change comes about through dialog. Dialog rounds, workshops, feedback rounds… This is where you experience yourself together, reflect on how the interaction works, what is helpful and what is not. A common direction in which the company would like to develop is worked out, what this means and concrete measures are derived from this. Individual management development and coaching support this process.

The aim is for every manager to realize what it means for them to actually live this new culture and for all managers to have the same image, the same vision of the new culture. If everyone has had the same training in this respect, then you talk about the same things, then you have been able to develop a common attitude.

The more extensive these measures are, the better. Cultural change is progressing very slowly. It is important to constantly engage with it, because mindsets only change over time. This is not something that can be dealt with in one or two days!

Change or switch management!

It is possible that top management recognizes that some of the executives do not fit into the new culture. It is very important here to find a way to take the managers out of the system and bring new managers on board; managers who already embody the new culture. Of course, you should first try to implement the cultural change with the current managers. Sometimes, however, it can help to bring in a breath of fresh air.

We have already experienced in our work that managers have really changed extensively, that they have realized that they are living in a new era in which different behavior is desired. Unfortunately, this is rarely the case. If a manager does not succeed in changing and could thus hinder the change in the entire company, it is crucial for the change to make clear cuts and find someone who lives and spreads the new corporate culture.

Cultural change step 5: Involve all employees with dialog formats

Dialogue formats, such as employee workshops, give you the opportunity to get in touch across teams or even the entire company and involve all employees in the cultural change – no matter how big the company is. It is not necessary to hire 1000 external moderators for this. On the contrary: it is better if the moderators come from the company itself, for example, we work with ambassadors to stimulate dialog among employees with a predetermined structure and a targeted goal. This should certainly also be about culture, but also about other topics where employees make decisions. In this way, a new culture is slowly emerging, because the things that are supposed to run by themselves in the future are done in a very structured way: Employees work across interfaces and talk and decide together on relevant topics.

It is about thinking about the existing culture and the desired culture, dissolving internal boundaries and creating networks so that a new communication behavior can be established. The aim is also to enable employees to get to know the diversity of the company. Because if you talk to other departments, you automatically develop an understanding for their concerns, which in turn has an extremely positive effect on cooperation. And last but not least: such events strengthen the sense of unity!

The results of the dialogs can be evaluated by a transformation team. What overarching fields of action emerge? And where can the teams themselves start? Overarching areas of action are, for example, the structures or incentive systems in the company. You can find some examples below:

Cultural change Change employee workshop

Cultural Change Step 6:
Change the corporate structure!

Restructuring can be a very good tool to positively influence a culture! If your company has worked together on a functional basis up to now, for example the salespeople are in a team with the salespeople, the accountants with the accountants and so on, then you could, for example, ensure that there are cross-functional team structures from now on. What does that mean? All functions included in a workstream – from the first customer contact to the invoice – for example marketing, production, project management, sales and accounting work together in one team. In order for all the functions required to map a workflow to work together successfully, very close coordination is necessary, i.e. the greatest possible exchange and sharing of information is required. This flow of communication influences the culture immensely.

This is because the barriers between departments, through which information previously flowed inadequately or not at all, or where decisions were not previously made, are no longer there. By exchanging ideas, it is possible to decide what is good for the customer and what is good for the company.

And, of course, restructuring also promotes changes in behavior: The entrenched, previous behavior breaks down and openness to new things emerges. This openness, this opportunity to reorient oneself offers an excellent chance to say: “We are now starting the new team with a new culture!”

Cultural Change Step 7:
Redesign the environment!

If you change your company’s premises, cultural change will also be reflected in everyday life.

One company that we have supported has significantly restructured its office in parallel with the cultural change process: Individual gray-on-gray offices became open-plan shared offices with lots of chill-out corners in between. Cheerful colors were chosen, there were corners to communicate, corners where you could talk on the phone in peace – all in all, this created an atmosphere of openness and space in which you could feel comfortable.

Of course, a colorful chill corner does not change culture, but it supports the changes that are taking place because it gives the new mindset a visible expression and thus breaks up existing patterns and habits

Cultural Change Step 8:
Establish new reward systems!

We have already discussed this in detail elsewhere: The reward system is one of the most important foundations of a corporate culture.

Abolish individual commissions, for example! Reward the whole team! And involve employees in the success of the company! So that teamwork pays off and employees are interested in making your company successful.

Cultural Change Step 9:
Use other working methods!

If the company’s employees work together in a completely different way than before, this will naturally also change the culture.

An example: Up to now, you have used the classic waterfall method for project management. Now you are working with Scrum. The fact that this way of working focuses on teamwork, that there is regular communication with everyone involved, that decisions are made in a completely different way, that employees work in a self-organized rather than regulated manner, automatically creates a different way of working together, a different culture.

It is said that agile methods cannot be successfully introduced without the corporate culture also becoming agile. It’s a bit like the question of the chicken or the egg. What to start with? As you have read, many other factors are needed to change the culture and so it is advisable to change the working methods in parallel as part of a cultural change. Change goes hand in hand: people change when they behave differently. And when a person changes, their behavior also changes, among other things.

You can find an overview of agile working methods in our article

Agile methods: Design Thinking, Design Sprint, Lean Startup, Scrum

Cultural change Processes, communication, behavior

Cultural Change Step 10:
Optimize communication channels and communication behavior within the company!

Make sure that all employees are involved, that there is transparency and that the company management can communicate as directly as possible with all employees. Whether directly or via video conference – the communication channels naturally depend on the size of the company. To ensure that information that is of interest to everyone reaches everyone, maintain the communication cascades with middle managers!

Introduce new communication channels! What could that be? For example, an intranet or an internet chat function, for example with teams. Such communication options show employees that they are involved, that they receive all the information and can participate in decision-making. And ultimately this changes the culture.

One of our customers introduced a chat program with a voting function. This meant that ideas could be made available company-wide and all employees who wanted to could comment and vote on them.

Of course, you should consider beforehand which decisions you can share with all employees and whether you want to make it a majority decision. However, whenever this is possible – do it! It makes a big difference when colleagues feel that their opinion counts and that they are being consulted.

Cultural Change Step 11: Get support!

You have seen: Corporate culture is deeply rooted, has many facets and factors and can only be changed very slowly. As part of the existing system and culture, it is often difficult to break out of habitual behavior and pull the entire company along with you.

Therefore: Get external support to make an objective analysis of your existing culture, to develop a vision of what your organizational culture can look like in the future, to guide you through appropriate steps, to stand by your side in case of obstacles and to keep an eye on whether things are actually moving forward.

If you are interested in the topic of corporate culture and cultural change or are looking for support, we are here to help and advise you.

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Practical examples of cultural change

Would you like a practical example of how exactly we have accompanied a cultural change? Then read our article Corporate culture: an example of value-based change!

Nope? Enough reading – would you rather watch a video now? In the video Change curve: What phases do people go through during a change? Susanne helps you to understand in 6 minutes how your employees are doing in change and cultural change.