CULTURE TRANSFORMATION: The Level5 Approach to integrating Culture and Brand for Business Success

Level5 Strategy is Canada’s pre-eminent independent strategic consultancy firms with a client roster that includes many of Canada’s most well-known and well-respected brands and businesses. Founder David Kincaid is widely acknowledged as one of Canada’s keenest strategic leaders and business advisors. David, who in 2013 was inducted into the American Marketing Association “Marketing Hall of Legends”, has long championed the notion that business success requires leaders with an unwavering commitment to building strong differentiated brands. As a life-long marketer myself, this commitment to brands resonates deeply with me and my own career experience. What intrigued me about David – and what spurred this interview – was the acknowledgement of people and culture as critical drivers of that brand performance. We caught up at Level5’s downtown offices to chat business performance, culture and what it means to be a Brand Driven CEO which, coincidentally, is the title of David’s most popular leadership books.

HB: David, always a pleasure to spend time with you. I always like to start with a brief background on my interviewee. Would you mind giving readers a topline of your amazing career and some background on your firm Level5?

DK: Good to see you too, Hilton. I was fortunate that I started my corporate career in packaged goods at General Foods and was taught the fundamentals of brand as a business system from the very start. The packaged goods industry – Procter, General Foods, Unilever – these were all organizations that knew and respected the value of a brand in a very literal sense and the importance a brand has in delivering financial success and business growth. I went on to have an exciting corporate run across several categories from credit cards with American Express, over a decade in the beer business which was enormous at the time with Labatt and Anheuser-Busch and finished in the telco and media space with Corus. It was fantastic and I got to learn so much and meet so many fantastic people, partners and mentors on that ride.

The notion to start Level5 really came from this itch – this frustration if I’m being honest – that so few leaders saw “brand” in the way that I did. More specifically so few saw brand, as I said earlier, as an entire system for creating and nurturing value. I’ve spent decades convincing people that brand isn’t just a marketing exercise but something core and central to how a business is lead and managed. That passion, that frustration <Laughs> compelled me to start Level5 over 20 years ago because I saw an opportunity to change the narrative, or expectation, of brand to an entirely different place. I’m proud to say that I believe we’ve had an amazing track record of doing just that, changing the brand narrative, and I’ve had the great fortune to work with some brilliant colleagues and clients along the journey.?

HB: Slightly different slant from our historical chats about marketing. Today I’m keen to dive into the arena of culture and to understand your perspectives on culture as both a founder and as a C-suite advisor.

DK: Happy to because I am an ardent believer in developing strong differentiated cultures. Let’s talk about Level5 first because that’s obviously the culture where, as founder, I’ve had the most direct impact. Firstly, I'm very proud of having started something from scratch in a very tough sector. Level5 is genuinely up against the land of the giants in the strategy consulting space and we’ve survived for over 22 years which is a tremendous achievement. I’m very proud of that record but it goes directly to our people. Our people are the reason our clients choose us and stick with us, some of them for almost two decades.

One of my mentors, Hugo Powell from Labatt, once told me that building and nurturing a culture is the single toughest leadership challenge you’ll face. In his words it was like trying to nail Jello to a tree <Laughs> which is a great metaphor and one, from my own experience, is totally apt. Culture is a fluid, organic, evolving aspect of business and, here at Level5, that has certainly been the case. In fact, our name Level5 is derived from foundational guardrails or values I established when I began the firm - ambition, openness, integrity, caring, and accountability. To that I added a sixth – collaboration – because I saw that as a vital dimension our team needed to have. Not just internally but with our clients too. I truly believe how our team shows up – embodying these values – is why we’ve got the relationship tenure we do with our clients.

Beyond values and evolution, culture also has a legacy aspect too. I’m very proud of the fact that the Level5 culture is now something that, if I was to be hit by a bus, would continue on without me. It is become part of how we hire, how we work and how we promote our people. It is shared by all of us and it has grown and evolved beyond my original intent for it. I’m very proud of that.

HB: I’m very keen to avoid any mention of that Strategy & Culture quote we both see far too often in LinkedIn. Tell me when culture began to surface as a factor in your own career or in the strategic advisory services that Level5 offers to its clients.

DK: Great question Hilton. Like many people I’ve had my own experiences with great cultures and with toxic ones. Cultures where we were able to achieve great things and those where momentum always seemed elusive.

In truth when I was doing research (for my two books) I was building a richer business case for leaders and organizations to make a concerted investment in building brands, so I was looking for examples to bolster that argument. In business language, “Brand” has always been attached to the marketing function and seen as a marketing responsibility. I saw that as too narrow a definition and I wanted to figure out a way to articulate brand in a new way, specifically in a way that went beyond the traditional “brand as intangible asset” understanding. A way, bluntly, for executives to see that being oriented or thinking through a brand lens could unlock significant value for all stakeholders. To my mind a brand is a promise, which I outline in my book “ The Value of a Promise Consistently Kept”, and our research found six core factors that business leaders who’ve built great brands all share. No surprise those leadership factors include elements like declaring an overarching purpose, an ability to build consensus and a knack for motivating and managing change. Those leadership factors obviously cascade down and have a direct impact on the type of organizations they create.

It was at that organizational level that the contribution of culture became very evident. I found there were 4 “new” P’s that drove these organizations. Any classic marketer is aware of the classic 4P’s – price, product, place and promotion – but our work uncovered these new P’s. Process, IP, Partnership and the most important, People.

HB: Okay, you had me at 4P’s. Can you go a little deeper on this point, specifically the People part?

DK: Absolutely. One of the first questions we ask any prospective or tenured client is the classic “what business are you in?” It’s a remarkably simple question but how leaders answer gives us profound insight into how they think about their organization and, more directly, how they believe their organization creates value in the market. Sadly, most answers always seem ground in either their product or service. Take Boeing, merely as an illustrative example, who might answer “we’re in the plane building business” That’s accurate but it under-represents where the organization actually creates value for customers, for employees and for shareholders. In truth, Boeing are in the “peace of mind” business. Peace of mind that their planes are well-built, safety conscious, fuel efficient, environmentally made and so forth.

The reason I purposefully put People as the first of the 4 “new” P’s is because I genuinely believe they’re the foundational element of any successful business or brand. Take Four Seasons, a quintessential iconic Canadian brand, and how central people are to delivering on that brand’s promise. And to the “what business are you in?” question, there’s no doubt in my mind Izzy Sharp would ever have replied “the hospitality business” How that business operates – and the incredible people and culture it has – highlights Izzy Sharp knew that the People part was going to be foundational in their differentiation strategy.

HB: The Four Seasons reference is great. I know Level 5 has been long term advisors to other great Canadian brands like Canadian Tire and Canada Goose as well. With People – or culture – having such an impact on brand or business performance, why in your experience isn’t it given more attention or primacy?

DK: I’ve seen a couple of reasons for why this happens over the years. In some cases, there’s still the misplaced notion that culture is something soft that can’t be measured as accurately as many other elements in a business. I don’t necessarily agree with that idea but we live in a business environment where “what matters must be measurable” in hard and unambiguous terms. Drawing the direct correlation between culture and the bottom line can be difficult for many organizations. That’s one reason.

Another, particularly in large multi-divisional organizations or one’s with myriads of business lines, is sheer complexity. In our time we’ve encountered several moments where the leader of Division X will say “we have this type of culture because that’s how we operate or differentiate in the market” and the leader of Division Y will counter with “to be successful we have a very different culture because our customers need something different from us.”

Neither are necessarily wrong – they are trying to execute their strategies – but this conflict between cultures and sub-cultures can make consensus very difficult. That’s further exacerbated when some Divisions are doing well and have limited appetite to change their formula.

<Laughs> In these situations I love to employ the classic “5 Why’s” approach to really get the executives thinking. They’ll express frustration with a certain problem, and I’ll ask, “why does that problem exist?” They will often peel the onion backwards and say, “well, because we don't have the right process.” “Okay, why don't you have the right process?” “Well, because we don't have people that know how to write code for Situation X.” “Okay, well, why don't you have the right people to write code?” “Well, because, you know, HR won't let us hire those people.” Ok, then why won't they let you hire them? And if you keep asking why sooner or later you stub your toe on, because we just don't do that here. Well, then you've got a cultural issue.

HB: Love those examples David. Is there another of your new “P”s that you think has a profound impact on culture and leadership?

DK: In truth all four operate as an integrated system. From People to IP to Partnerships to Process, they all play a role and all feed into each other.

As I think further, perhaps Partnerships is the one that stands out because, unlike the others, it has an external facing component. It’s about how you choose organizations and businesses outside of your control to work with and to, ideally, win with. That always comes down to leadership – as does culture – and a new way of leading in my opinion. When I started my career it was heresy to consider doing anything foundational to your business outside your own four walls. At General Foods our innovation began in the Kitchen on the ground floor of HQ and was kept tightly controlled and highly monitored. The speed, complexity and global nature of business today makes that way of operating impossible. In fact it can actually hobble your business if you are too narrowly constrained internally.

Partnerships is a classic way of finding subject matter experts adjacent to your skills and working together to achieve success. I say it’s a leadership competency because if you don’t approach it with the right mix of competitiveness and humility it will fail.

Competitive because you want to win and you want to protect your brand, your culture, your IP but humility because you recognize your organization doesn’t, and can’t, know everything. That’s a delicate balance for many CEO’s to tackle but it is a crucial skill if you want to succeed today.?

HB: Beautifully articulated David. I always ask my interviewees for a piece of advice they would give their peers. In your case what advice to you give to owners or founders of organizations as they’re thinking through these challenges?

DK: Instinctively I’d say “have the courage” and “take the time” to think through your vision for the organization, or brand, and map that backwards to the steady, consistent actions you’re going to take day by day to realize it. I see too many leaders and organizations make a series of decisions to address or appease a short-term horizon or a tough analyst call. That short-term action becomes a wedge in the door that, over time, creates something entirely different from the original vision of the organization. Brands that have existed for decades obviously need to evolve but they don’t lose sight of what or why they were originally conceived.

That’s the courage part of me. The courage to set out something bold that delivers value in a unique and desirable way. Value that connects with customers and keeps them coming back. The Four Seasons Izzy Sharp example. The courage is holding that line and that belief. The courage is accepting that realizing that vision may not happen while you’re leading the company and that it may be another CEO who finally realizes the vision. That’s ok. Have the courage to not deviate from a vision that is honestly delivering real value to your customers. Trust me, over the 22 years of Level 5 being in business, that temptation can be very real, but you have to resist it.

I also believe – because I’ve seen it here at Level5 – that you must nurture curiosity and diversity if you want your people and your organization to succeed. Curiosity is so fundamental that saying it is important, particularly in an advisory business like ours, is almost a cliché but its true. Be fascinated by your sector, category, business of course, but if you’re not curious about how the world works, or doesn’t, you will miss opportunities and frankly you will lead a very boring life. Staying curious keeps you young too so be curious. That is non-debatable in my books.

Diversity can be a tricky conversation, especially here in Canada, but it is another facet of brand building and leadership that you must nurture. Not as a tick-box exercise or a shallow exercise in merely saying do we have representation of everyone in this group.

That’s important without question but the real diversity benefit comes from being purposeful in bringing diverse experience and perspective to a problem. A senior, an immigrant, an unemployed person, a wealthy person will view a problem – and likely create a solution – that wouldn’t be possible in a homogenous environment. Diversity of lived experience is the real objective and the real game changer in my view.

Then, back to culture, can that diverse group work well together, work in a meritocracy and come up with the fresh ideas we need? That’s infinitely harder but, if you can achieve that kind of culture, it is just brilliant to see.?

HB: A classic founders perspective. Love it. Always do appreciate time with you David. Thank you for today.

DK: My pleasure Hilton. Take care.

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This ongoing series of interviews is intended to inspire and educate business leaders about the profound impact culture can have on your success.

I'm delighted to partner with the amazing team at Innovisor and share stories and practical advice on how to address change, transform culture and unlock the real potential inside your organization - your people.