Book Review: Culture Renovation - 18 Leadership Actions to Build an Unshakeable Company (Kevin Oakes)

Culture Renovation:  18 Leadership Actions to Build an Unshakeable Company You can get it on Amazon now!

“Culture is the underlying fabric that holds an organization together.”

Introduction:  Renovation Versus Transformation

This is my favorite kind of non-fiction book to read.   It’s informative, funny in places, revealing, and drives the reader to turn the page, seeking what insights lay ahead.   If you are in leadership in an organization or if you are an employee and want to be a reagent for cultural change, Kevin has done the heavy lifting and created a checklist for thoughtful and sustainable cultural change.  While I do provide some of the details from the book, you are doing yourself a disservice if you don’t buy the book and read all of it.   The return on your reading investment will be immense.

Kevin provides an overview of the importance of culture and the ability for it to be understood by organizational stakeholders.

My favorite nugget from Oakes’ Introduction is, “...companies that effectively changed their cultures were successful because they were renovating what they had, not starting from scratch and completely rebuilding or transforming.”  Oakes’ insight on this point ciphered from the plethora of data and case studies, drove him to this epiphany, which is a key tenet of the book.  I find these aha moments often to be some of the most powerful flywheels for innovation.

Another interesting data point is that “Only 15 percent of companies that embark on culture are successful.  So, i4cp developed a culture renovation blueprint, in three sections: Plan, Build, and Maintain, in 18 steps.

Chapter 1:  Does Culture Predict Performance?

Kevin does a phenomenal job in this autobiographical chapter relaying the growing pains of his newly-formed venture-backed company, i4cp, and challenges related to the economic downturn of 2008.

His story about visits to two Palo Alto computer companies and the dichotomy between their cultures provides a prescient view of why culture renovation is so important to i4cp and Kevin.  

I must say, Kevin’s description of his visit to the first tech company made me smile.   It caused me to flashback to the way Dan Lyons described his experience at HubSpot in an entertaining and revealing memoir, Disrupted.  Kevin’s revelations from his visits with the two companies and their dissimilarities was a huge epiphany and was a catalyst for i4cp’s continued research and development in the area of culture renovation.

Another critical learning from this chapter is the direct correlation between great company culture and the financial performance of the company.

Kevin also describes part of what his company looks for, which are “next practices.”   Next practices are “...defined as people practices that had a strong correlation to market performance but were implemented in only a small percentage of companies."  i4cp’s conferences are actually called Next Practices.

Chapter 2:  The Rise of the Unicorns

This chapter defines a “Unicorn” (a company with an investor valuation of at least $1 billion.)  In 2013 when the term was first coined there were 39 such companies.  There are over 400 unicorn companies now.  In most cases, these companies are focused on disruption through new technology or business model, or both.

Kevin features the Blockbuster/Netflix case study in this chapter, which clearly demonstrates Andy Grove’s, Intel CEO’s statement: “Success breeds complacency; complacency breeds failure.”

He also tees up the notion of agility and how important it is for organizations.  One of i4cp’s studies, The Three A’s of Organizational Agility:  Renovation Through Disruption, further details this and describes how innovative organizations use an Agility Model, which is anchored in: three steps, 1) Anticipate, 2) Adapt, and 3) Act.

i4cp’s research has shown that the philosophy of constant change can improve productivity.

Chapter 3:  Culture Renovation Needs to Start at the Top

I thoroughly enjoyed Chapter 3, which could have been called, “Microsoft, a Tale of Three Leaders.”  In a former role, I sold professional services to Microsoft, so the dive into Microsoft’s history and the cultural transition was fascinating and insightful.

Kevin does a great job describing how a CEO can manifest himself or herself as core to a company’s culture.  There were three different cultures with Microsoft, which evolved from Bill Gates to Steve Ballmer to Satya Nadella.

The accomplishments of Nadella’s leadership are phenomenal.  He quickly established a growth mindset, based on theories developed by Carol Dweck, and his innate belief that it is much more important to be a “learn-it-all,” versus a “know-it-all.”  He was the cultural guidon and his influence as a leader was core to Microsoft’s ability to renovate its culture.

A Blueprint to Renovate Culture

Phase One:   Plan

It’s hard to be successful at most meaningful endeavors without a plan.  The next six chapters of the book lay the groundwork for a solid plan to renovate an organization’s culture.

Chapter 4:  Step #1:  Develop and Deploy a Comprehensive Listening Strategy

The importance of transparency and being true to one’s self are a couple of the core tenets that helped John Legere, the former T-Mobile CEO, reshape the company’s culture. It’s critical to be listening to your employees and customers as they are the foundation of the culture of your company.  Kevin provides multiple examples of how T-Mobile was able to embody these and how his #1HR team was able to support him on this journey. 

Listening inside companies often happens with Annual Employee Engagement Surveys, but they are often laden with high costs, long implementation times, and cumbersomeness.  Instead, many organizations, including Microsoft and Amazon are using pulse-type surveys.

Chapter 5:  Step #2:  Figure Out What to Keep

3M is the case study for Step #2.  As aptly stated by Kevin, “...57 percent of organizations that were highly successful in ensuring that the best of the company’s existing norms were preserved, and fundamental values and history were woven into the new culture.”   If you are renovating a house, or a car, or a piece of furniture, you don’t start from scratch; you keep the best parts of what you plan to renovate.

It was interesting reading about the many innovations that 3M has brought to market over the years.  The catalyst for much of the continued innovation came from early employees like William McKnight and others who listened to customers and created new products to support their various needs.   3M also initiated a “15 percent time” policy, whin enabled its employees to spend fifteen percent of their time working on activities outside the scope of their usual jobs.   This is how products like Post-it-Notes, Scotch Tape, and many others were born.

Chapter 6:  Step #3:  Set Your Cultural Path

One of the easiest ways to get from one place to another is via a defined path.  It’s true in a company’s journey of culture renovation too.   This chapter features a discussion on how various companies have created this cultural path as well as the importance of a “purpose statement.”  Many companies have them, and it’s important to have one that resonates throughout the organization.

I really liked the purpose guidelines provided and the10 sample purpose statements from companies like Tesla, TED, Patagonia, and CVS.  This was a perfect pivot into a deeper case study on CVS and the juxtaposition it found itself in with its purpose and its actions.  CVS’ Purpose Statement: “Helping people on their path to better health.”   In 2014, CVS decided to stop selling cigarettes, which was a move to align themselves more closely with their purpose.

Kevin breaks down what he calls, “The New Corporate Currency,” which is a model, which shows the criticality of linkage between an organization’s Purpose, Culture, and Brand.  Chinks in any of these facets can lead to the devaluation of a corporation's currency.

The latter part of the chapter is focused on an interesting case study of Mastercard, and its current CEO, Ajay Banga.   You might never suspect that a “technology company in the global payments industry” would have a “decency quotient,” but they do, and it’s a core part of their culture and continued success.

Chapter 7:  Step #4:  Define the Desired Behaviors

In this chapter, we learn that desired behaviors have a direct linkage to the company culture.  There is a table featuring ten “Culture Types,”  which include, culture; leader, and employee traits; as well as example companies.  I liked this a lot, and the example companies provided help me really grasp the example cultures codified.

There is an excellent case study featuring F5 and the way they acted to change the culture.  F5’s culture when it was founded needed to evolve after changing the direction.  A new CEO was hired, Francois Locoh Donou, who understood the importance of not forgetting behaviors that supported the culture and how to add new behaviors that did as well.  In particular, I like how the “BeF5” culture model was integrated into F5’s “...systems and processes, such as performance management reviews, employee recognition programs, and employee learning and development programs.”   I can appreciate this because when I worked at Dell in the mid-90s, the Dell Business Model was immersed in its systems and processes as well.

Another key point from this chapter is that these supporting behaviors must be demonstrated by the leadership team.

Chapter 8:  Step #5:  Identify Influencers, Energizers, and Blockers

I found this chapter very intriguing because of its description of influencers, energizers, and blockers and the ways these archetypes can be identified in the organization.  They can be identified by an Organizational Network Analysis (ONA).   The “ONA can provide an x-ray into the inner workings of an organization--- a powerful means of making invisible patterns of information flow and collaboration in strategically important groups visible.”  The three network roles identified (Connectors, Boundary Spanners, and Energizers) reminded me of similar roles Malcolm Gladwell discussed in The Tipping Point:  How Little Things Can Make a Big Difference.

There is a case study on AbbVie and how it used “culture ambassadors” to help invent its culture and the importance of bottom-up communication and collaboration during the process.  The chapter ended with the major hacking incident of Sony Pictures from the North Koreans because of the movie, The Interview, which Sony planned on releasing Christmas 2014.  The case study really demonstrates how a crisis can illuminate leadership.

Chapter 9   Step #6:  Determine How Progress Will Be Measured, Monitored, and Reported

Chapter 9 focuses on how important culture is to corporations and the Boards that provide leadership and guidance to them.  Another key principle of this chapter is how critical establishing practices and processes to measure, monitor, and report on culture and/or the culture renovation happening in the organization.

Kevin provides great examples of common measures such as attrition, inclusion, employee referrals, talent mobility, rehires, hotline activity, EAP usage, and employee Net Promoter Score (NPS).   This is followed by a section on common methods for collecting the metrics, such as focus groups, engagement surveys, pulse surveys,  and sentiment analysis.

He wraps this important chapter with a very relevant case study on culture measurement at Ford and the entire list of ISO standards for HR.  In particular, I liked the list of standards, they can help organizations identify categories of metrics, they might want to track.  He notes the notable increase (almost triple) in HR executives on US public company boards from 2005 to 2017.

Section:  Phase Two: Build

Chapter 10  Step #7:  Clearly Communicate That Change Is Coming

When renovating culture, it’s important that the reasons and the new direction the company are clearly and consistently communicated.  Most companies who are successful at renovating their cultures have done this well and typically this is promoted by the company’s CEO.  Kevin shared a humorous but prescient parable about an incoming CEO and the advice he got from the CEO he replaced in a sealed set of three envelopes.

My favorite part of this was the case study on WD-40 and its dynamic leader Garry Ridge.  His communication and modeling of the key tenets of WD-40’s culture have helped drive the stock price of the company to increase sevenfold over his tenure.  I also loved WD-40’s culture of continuous learning and sharing “Learning Moments,” which could be best or worst practices.

Chapter 11  Step #8:  Ferret Out Skeptics and Nonbelievers Early

Renovating culture in an organization can be difficult, even when well-planned.  There can be plenty of naysayers, skeptics, blockers, doubters, and obstructionists, who can create enough drag on the culture initiatives that they can delay it significantly or even cause them to fail.

Microsoft’s Satya Nadella is featured in a mini-case talking about his promotion to CEO and the people that needed to be moved from the Senior Leadership Team (SLT), who was a part of Steve Ballmer’s SLT, who weren’t necessarily aligned.  Nadella also talks about the importance of finding the right CHRO, and how she (Kathleen Hogan) because his partner in culture renovation.

Another case study follows F5’s new CEO, and how much importance he placed on his CHRO during their culture renovation too.  The importance of CHROs as it relates to culture change, and how important they have been during the Covid-19 pandemic.

The chapter ends with a brief discussion of the core tenets of Bob Sutton’s best-selling book, The No Asshole Rule:  Building a Civilized Workplace and Surviving One that Isn’t.  Kevin shares Sutton’s two simple tests for deciding if someone fits the bill.

Chapter 12  Step #9:  Paint a Vision for the Future

The extreme and everlasting power of storytelling is a core theme of this chapter.  Great companies have great stories that not only can recount the company’s founding but also use to paint a vision for the future.   I have always believed in the impact of storytelling and how it can capture the listener’s ears, heart, and mind.  As someone who has sold a lot of professional services, I have found my best presentations include a story, which hooks the audience and compels them to lean in and engage.

There are several interesting case studies including Yahoo!, Boeing, Procore, Booz Allen Hamilton, and Bensussen Deutsch & Associates (BDA), which feature ways the aforementioned companies have had CEOs who have had an impact on their culture renovation.  Note:  Not all of the companies did it well, and one of them can point to a Disney character as a cultural icon.  

Chapter 13  Step #10:  Consciously Collaborate

The three dysfunctional archetypes of collaborative networks are defined: overly participative culture, hierarchical culture, and a culture of fear.  Babson’s Rob Cross, who codified these says, “Culture defines who interacts with whom and how and is reinforced by the networks in place.”  High-performance organizations are very intentional about how collaboration occurs.

There is a great case study about Patagonia, and it’s innovative founder, Yvon Chouinard, and its journey since 1973, including a shift in its original mission to be one more reflective of the current state of the world’s environment.  Its original mission was, “Build the best product, cause no unnecessary harm, use business to inspire and implement solutions to the environmental crisis.”  In 2018, the mission evolved to, “Patagonia is in business to save our home planet.”

I was impressed with the examples the company has taken socially, politically, and culturally to embody its current vision and the amazing benefits it shares with its employees.   Patagonia has a turnover of 4%, versus an industry average more than triple that.)

There is a mini-case on Booz Allen Hamilton also as well as an important discussion on collaborative overload and the detrimental effects it can have on affected employees. 

Chapter 14  Step #11:  Establish a Co-creation Mindset

This chapter features several interesting case studies from KeySpan Energy, Ford, and W.L. Gore and Associates.  

The KeySpan case study includes how a most unlikely character, a Monk, Kenny Moore, ultimately led the organization’s HR department.  One of the most intriguing actions I have ever read about an HR Leader was Moore’s plan to evangelize the need for change in culture with a “mock funeral,” to bury the old and rebirth the new.  He ultimately co-wrote a book with his CEO, aptly called, The CEO and the Monk.

The chapter is rounded out with Ford’s #hackFORDculture, global hackathon initiatives to “co-create” the culture.   The final case study was on W.L.Gore and what the leadership learned there about excessive reliance on external consultants and de-enlisting the support of its associates.

Chapter 15  Step #12:  Provide Training on the Desired Behaviors

The bulk of this chapter focused on Starbucks and the racial profiling/bias that happened when two young African American men (Rashon Nelson & Donte Robinson) were asked to leave a Philadelphia Starbucks, and then ultimately handcuffed and taken to jail.  While the incident was terrible, it showed the resolve, and determination Starbucks leadership demonstrated to try to right the problem.  On May 29, 2018, Starbucks shut down its entire business operations to conduct unconscious bias training.  This exemplifies providing training on the desired behavior.  It was also the basis for a new training methodology, which was used for its response to Covid-19 and the social unrest spawned from the George Floyd incident.

There is also a discussion on various types of organizational cultures:  Agile, Collaborative, Innovative, and Inclusive, and indicators of each.  The last portion of the chapter describes the benefits of leaders involved in teaching inside corporations.  53% of all organizations that used leaders as teachers felt this strongly aided organizational change.

Section:  Phase Three:  Maintain

Chapter 16   Step #13:  Make Onboarding About Relationships Versus Red Tape

This chapter opens with a disheartening story of many typical first-day experiences for new hires in companies.  Companies are well-served to understand that strategic onboarding helps drive retention and accelerates the success of new hires.  Too many companies offer onboarding that is focused on administrivia and not the importance of establishing relationships that will help a new employee thrive.  “Push” and “Pull” relationships are defined, and the value of pull relationships for new employees to succeed.

Kevin shares an excellent example of onboarding for Toyota employees relocating from satellite locations into a centralized location in Plano, Texas in 2017.   This was no small undertaking, but the strategic design of the $1 Billion onboarding plan for those 2,800 relocating and the 1,200 local new hires were both mind-blowing and were a hit.

Chapter 17  Step #14:   Promote Those Who Best Represent the New

Part of maintaining your newly-renovated culture is to promote those who are modeling the behavior, which supports this new culture.  This can be very challenging in many companies as there typically isn’t an Integrated Talent Management system, which acts as a central repository for employee skills.

One interesting fact, which our company found conducting interviews with talent acquisition leaders in companies aligned exactly with i4cp’s findings:  “Often it’s far easier to find a new job externally than internally.”  A sample Talent Ecosystem Integration Model is featured that i4cp created working with Disney, which provides viewshed into a variety of different sources for talent.

Accenture’s People + Work project, fomented by the resulting layoffs and furloughs caused by Covid coupled with the rampant hiring needs of other companies is discussed.  The chapter concludes with Nordstrom’s evolution and its digital progression. 

Chapter 18  Step #15: Change Performance Management Practices

Kevin breaks down the bane of many organizations: performance management.   Interestingly enough, the earliest known performance management documented was in 221 AD, when the Wei Dynasty emperors rated their family members’ performance.  He further reviews the origins of performance management and describes its key tenets and practices in modern times.

He shares an anecdote his peer, Jay Jamrog, shared explaining how he got involved in i4cp’s predecessor organization, launched in the ’60s.  Next, is a description of how performance management is applied in various organizations, and how it has evolved over the years.

In summary, as performance management relates to culture renovation, Kevins says, “...when deploying and maintaining your renovated culture, ensure that how you measure performance aligns with behaviors you want to enforce in the post-renovation world.”

Chapter 19  Step #16:  Leverage Employee Affinity Groups

I loved this chapter.   My company, Frontier Signal, is focused on diversity sourcing and modular screening to help all talent find meaningful work.  There is a great discussion on the origination of Employee Resource Groups (ERGs), whom they support, and the benefits they provide to their members as well as the company.  Kevin’s company has researched these and they are most frequently there to support: Women, African Americans, LGBTQ, Hispanic/Latino, Veterans, and Asians.

Merck’s incredible CEO, Ken Frazier, is featured in this chapter and the great work he and his company are doing related to diversity and the actions they have taken to support it, including his work on the CEO Action for Diversity and Inclusion coalition.   If you haven’t checked out the site, you should.  It’s laden with information and resources related to diversity and inclusion and might be a catalyst for actions your company can take.

Chapter 20  Step #17: Increase the Focus on Talent Mobility

The criticality of talent mobility is the focus of this chapter.  The New England Patriots and Bill Belichick’s demand for drafting and coaching utility players and its direct relationship with their multi-decade success is fascinating.

The reasons many companies struggle with talent mobility is discussed and the two archetypes: the talent hoarder and the talent magnet.   People in many organizations, hoard their talent and will not let them seek better lateral or promotional opportunities.  What is interesting is that when talent mobility is driven as a key cultural tenet, managers that do this well become talent magnets.  Employees want to work with these leaders who see the value in professional development.

My favorite part of this chapter was the innovative program the US Navy initiated with Amazon called Fleet Tours with Industry.  Naval Officers got the opportunity to work for one year while still on active duty to gain experience and insights from working in a fast-paced high-tech environment.   While this provides obvious benefits for the officers in the program, there is a symbiotic value that goes back to Amazon and its employees.  Less than one percent of the civilian population has ever served in the military, so this provides many Amazon employees the chance to get to know a person in the military.  As a Navy Veteran, this made me smile reading this.

Chapter 21  Step #18:  Don’t Underestimate the Value of External Sentiment

The final chapter of the book focuses on the importance of external views and opinions of companies and how they can help or hurt an organization.  The origins of Glassdoor are described and how they are used by potential employees and the sometimes devious ways companies respond to bad reviews.

Kevin wraps the chapter by describing the importance of focusing on and measuring employee experience and the value of sentiment analysis.

Epilogue:   Theory Versus Tactics

For more insights, case studies, and resources, check out www.culturerenovation.com.

Kevin wrote a phenomenal book, one that you will gain valuable insights from if you read it.  I surely did. So don't just stand there. Go buy it!