When Cultural Change Can Unlock Growth

Growth is the default state of nature, and if you stop to think about it, of people too.? It’s why shows like Ted Lasso and Schitt’s Creek are so enthralling - we love to see people become something better than what they were.? How then does a company, which is at its heart just a group of people working together, come to a point where it is not generating new products or client experiences, not attracting new clients, not becoming more efficient, not finding ways to do what it does better?

Let’s consider four cultural factors: Mindset, Movement, Collaboration and Risk-Taking.

Mindset. Do you believe there is one, static approach to any specific business problem, that is knowable, addressed and solved at a point in time?? Nature, people, life and business are constantly evolving.? If your company culture does not account for that, you may miss the mark.

One way this often shows up is the “Copy Cat” syndrome:

Company A wants to improve their marketing success, and Company B is a competitor that has been winning in the market.? Company A recruits a marketing leader from Company B to replicate the same approach that Company B took.

What’s wrong with that?? Since the moment that Company B developed and executed their marketing strategy, has everything remained the same?? Client expectations?? Technology?? Market conditions?? This is the point in time issue, which is only part of the picture.? Do Company A and Company B offer the same product, support model, pricing, technology?? What about the culture, employees and marketing budget of Company A and Company B.? Are they identical?? Depending on how much is different, perhaps the approach from Company B will work at Company A.? Maybe.? But is this the best possible approach, a path to the best possible outcome?

Another one to keep an eye out for is the “One & Done”.? Once an effort is successful, it’s standard to move on to other priorities, making the assumption that success will continue on its own.? For example, a specific product takes off with a set of clients, generating volume and stability for the overall business.? What’s wrong with leveraging the revenues from that effort to fund other things?? Nothing.? However, a portion of resources from the volume-generating success need to remain in support of that business.? Not just the minimum resources required for lights-on support, but more.? Innovation with this set of customers is your best path to expansion, and deteriorating service and technology with flagship clients presents a risk to the overall business.

I’ve also witnessed the “Bake-off”:

Company A wants to increase innovation, with the goal of improving business results.? However, resources (as always) are limited, and not all ideas can be funded.? Company A develops a framework for evaluating ideas and holds a competition to determine the winner, which gets funded.? Ok… what’s the problem?? This approach is in conflict with the way innovation organically works.? The first idea for solving a specific issue is unlikely to be the best one, but it is a step forward on a path towards what ultimately does work.? The flaws in the first solution lead to adaptations that lead to the next iteration and so on.? Judging ideas based on whether they hit the bullseye on the first try is an effective way to slow down innovation.? What’s needed is a relentless focus on solving a few high priority problems, with the understanding that fully resolving any of them is an iterative process.

When a mindset that supports growth is in place, it’s time to look at Movement. Movement is the opposite of inertia.? Getting unstuck requires evolving beyond the current state, the way that the business has been operating.? This could be the approach to product development, technology, sales strategy, marketing..? anything.? What keeps a company from changing the way they have done things, even once it’s clear that a new approach is needed?? It may sound obvious but.. it has to be culturally acceptable to point out what isn’t working, without repercussions.? Have you created a culture where it’s ok to discuss the faults of your current state?? Consider a common blocker, the “Defensive Bully”:

Employee X at Company A is the one who built the approach to an important function, to use a simple example - sales.? Employee X hustled to develop the sales team structure and approach, overcame challenges to get it staffed, trained and closing.? Employee X was rewarded for his efforts with a promotion.? How often is Employee X open to constructive criticism of what he has built?? How often does Employee X have the clarity to see that his approach needs to change, as the business has grown and evolved?? How often does Employee X see his career as so tied to the current approach that he discourages others from criticizing it?

When Employee X falls into the predictable pattern of discouraging criticism of the current state, how does leadership handle it?? If it’s not handled appropriately, other employees will naturally stand down, and inertia takes hold.

The next stage in the continuum, following Mindset and Motion, is Collaboration.? While it’s essential to have a culture that allows constructive criticism of the way things are, there is more to be done.? It’s time to unleash the potential of multiple people working together to develop action plans that work across teams and functions.? Is the team able to put their heads together and agree on a path forward?? Here, the biggest challenge is what I will refer to as “Personality Bias”:

The leadership team at Company A gets together for a working session at a team off-site.? Time is dedicated to brainstorming on a particular aspect of the business that needs to be improved.? Employee Y leads one of the teams closest to this business issue, and has a solid grasp of client feedback on the matter.? Employee Y proposes an approach that several other strong contributors on the team agree is the best place to start.? However, Employee Z opposes Employee Y’s suggestion, proposes a different approach and aggressively advocates for it.? What the senior leader does in this instance is critical to success.? Will the best proposal go forward, based on its merit alone?? Or will leadership “go with the flow” and let the loudest proposal win?

The final element is Risk-Taking.? I’m not talking about taking financial, regulatory or operational risks.? I’m referring to the risk that a leader takes by committing to a goal or addressing a specific issue, and going all-in on tackling it, despite challenging circumstances.? Here, my example is not something to look out for and work to avoid.? It’s the opposite - what TO do.? It’s rare, and powerful - years ago I had a leader do this for me, and it made all the difference.? Let’s call it the “Risk-free Stretch”:

Company B’s goal is to expand into a new customer segment.? After a dedicated business development effort, Company B identifies a high-profile enterprise partner in the target segment who is willing to showcase Company B’s product at their annual trade conference.? However, the timeline to develop a product in time for the conference is far less than what is typically required.? Even outsourcing development to a third-party technology company known for faster speed to market, the technology team is unwilling to commit to on-time delivery.? Company B can attempt to meet the timeline, which - if successful- will allow them to participate in the enterprise partner’s annual conference and begin to attract new business.? Or they can play it safe, begin work on a realistic timeline and kick off a full year later.

What my leader did in this instance was remarkable.? He could have said - go for it, and whatever you do, find a way to make it work - putting me in an position where my odds of failure were significant and pressure was at a palpable high.? He could have played it safe, disappointing both of us and delaying the business results that we wanted.? Instead, he told me not only to go for it, but also that he had my back, whatever the outcome.? He knew that I wanted to succeed - even more than he did, and that I already had plenty of incentive to make it work.? The pressure of potential consequences if circumstances didn’t go my way would have been a headwind, only decreasing the odds of success.

With this support, I was able to see clearly the dynamics at play with our technology partner.? They didn’t want the downside risk of a commitment that they were not in a position to make.? So I released them from the request to commit and instead asked what we could to to maximize our odds of success.? They came back with a proposal to compress the timeline, add extra developer and QA resources at certain milestones, and set out aggressive timelines for requirements and approvals on my team’s side.? Without the worry of what it would mean if we did not achieve our goal, we were free to stretch toward a positive outcome.? Everyone hustled and did their part, and we were able to get our product built in time to showcase it at the conference.? Without the trust and collaboration I was able to unlock, thanks to my leader’s approach, we never would have made the deadline.

Summary & Conclusion

Mindset, Movement, Collaboration and Risk-Taking:? Consider each a step along a continuum of cultural elements that create an environment where human potential can do what it naturally does - change things for the better.