Updated: Feb 15, 2022
One of the most challenging aspects of building a digital culture are those related to the existing culture in the workplace and the behaviors of the people there. A McKinsey study has identified three key cultural intervention points that contribute to the overall cultural and behavioral challenge:
lack of customer focus
siloed mindsets and behaviors
In most cases, these intervention points are very much ingrained within the organization and the people who are part of it. With such an entrenched foundation, some businesses find it difficult to demolish such a foundation so they can build a digital-ready culture in its place.
In the face of such difficult challenges, senior leaders are expected to be proactive in shaping and measuring culture and approach it with the same rigor and discipline with which they tackle operational transformations. This includes changing elements in an organization that run counter to the culture change they are trying to achieve. This entails addressing the aforementioned cultural intervention points head on and determine the most effective way to deal with them.
The need to take calculated risks
In order to build a culture where people feel comfortable trying things regardless of the outcome, the organization’s senior leaders should break the status quo of hierarchical decision making, focus on innovating rather than optimizing, and celebrate learning from failure. It means a lot to the people that executives make it clear through their actions that they trust the front lines to make meaningful decisions. Such moves require risk taking, including aggressive goal setting and nimble resource reallocation.
On the other hand, delegating authority only works if the employees have the skills, mindsets, and information access to make good on such trust. It also helps that the information is readily available to the employees, allowing them to take small-scale risks, which can lead to some rapid innovations.
Reinforcing customer focus
While many companies often claim they intend to get to know their customers better, the digital age is forcing them to actually walk the talk and provide a better means to do so. As McKinsey pointed out, having a customer-centric culture is becoming a means of survival. But it also offers other benefits as well. For one, it can help reduce the risk of experimentation with companies able to develop product and service features in real time, with direct input from end-users.
Underlying this customer-centricity are diverse tools and data and the importance of connecting the right data in order to arrive at the right decisions that customers will ultimately benefit from. This also entails customer-centricity to become this unifying cultural element that drives all core decisions across all areas of the business. This also allows businesses to anticipate emerging patterns in the behavior of customers and tailor relevant interactions with them by dynamically integrating structured data.
While some might consider organizational silos a structural issue rather than a cultural one, they are more than just stray lines and boxes in an organization chart. Especially that many organizations work through collaborations, internal and external, having some people choosing to detach themselves from the rest of the organization and refuse to work with other departments can be corrosive to organizational culture and to the organization as a whole.
In order to break this siloed mentality, leaders must show the employees that there is a sense of overall direction and purpose of the company. One way is through data-driven transparency, allowing employees to see the whole picture of a given situation or process, thus giving them a sense of ownership and responsibility to maintain or restore the ideal situation or process in question. Another way that is being practiced in some organizations is to rotate executives between siloed functions and business units. This helps create a better understanding between different business units that will help ensure smooth operations, as well as helping create informal networks as employees build relationships in different departments.
There are also some organizations that implement cross-functional collaboration being delivered by flexible-deployed teams. Through this methodology, team members are held mutually accountable for the outcome regardless of their role, eliminating the “not my job” mindset that is often seen in siloed mentality.
It is also critical that organizations remove the barriers that keep people from collaborating and build new mechanisms that will help cut, if not eliminate, the red tape and bureaucracy that were built over time and are now hindering such collaborations. Leaders should also seek and promote specific mechanisms that can help build a shared understanding of business priorities and their importance to the business so employees can have a better understanding of the things that are going on and be able to make the right decisions.
A commitment towards change
Culture change towards a digital-ready culture takes considerable time and effort that could not be accomplished in just a short period. Thus, it is important that leaders are committed to see this change come through within the organization in spite of the odds that occur along the way. Business leaders must show that they are proactive in leading the company towards a digital-ready culture, building the necessary foundations not only towards achieving the end goal but also secure its future regardless of the changes and challenges ahead.