The importance of culture: top tips for success

Lindsay James
Lindsay James
By Lindsay James on 26 April 2018
The importance of culture: top tips for success

In a new blog post on Microsoft.com, Michel van der Bel, president of Microsoft EMEA, has outlined the importance of culture. “While it’s clear that companies are aware of the importance of technology when it comes to remaining competitive, digital transformation isn’t just an exercise for an organisation’s IT department. It’s also, crucially, very much a people journey,” he says.

“Our research findings have shown that, without fostering the right culture, transformation will never truly be successful.”

van der Bel spent some time discussing the importance of culture with Michael Parke, assistant professor of Organisational Behaviour at the London Business School, with a particular focus on the important role that organisational leaders have in getting the best out of their employees. Some of the most interesting elements of the conversation are below:

MvdB: Let’s start with a classic Peter Drucker quote – “culture eats strategy for breakfast.” How do you see this from your research perspective?
MP: You can have the best strategy in the world, but if you can’t execute it, it doesn’t matter. If a company has a culture where everyone knows their role and how they’re contributing, while standing for common values, then you have huge coordination and cost efficiencies. For example, you don’t have to spend resources making sure people are doing their jobs. Execution absolutely comes down to culture, and that’s critical.

MvdB: How would you define culture? I imagine it’s quite a broad term that can mean many things to different people.
MP: Looking at the research, culture typically has three ingredients. The first is how common values are shared and understood across an organisation. The second is the behavioural expectations which align with those values. For example, integrity – what does that mean? Does that mean I stay true to my thoughts and opinions even if I disagree with leaders of the organisation? If your organisation isn’t clear on that, as an employee, you could find yourself in a situation where you keep quiet in a discussion, as you don’t want to get in trouble or be seen as a risk taker. The third component is the shared understanding of methods used to solve problems, such as allowing people to work remotely, or deciding how much research is needed before decisions are made.

MvdB: What is one of the largest hurdles when it comes to creating a culture that encourages productivity? Is time our biggest enemy, or is it engagement? To clarify, should we spend more focus and attention on ensuring there are less distractions?
MP: Time is important, but it is really about quality time on task, which boils down to engagement. From a research perspective, engagement consists of three things, starting with how much time and effort you’re putting in. Second, is how emotionally engaged you are – your enthusiasm, your excitement, your intrinsic motivation. Lastly, we have focus – are you concentrating, or in an environment where you’re easily distracted? So it’s not just about the time spent or available for a task, it’s how much of your full engagement is on that task when you’re deciding to work on it.

If employees are investing their full efforts, they’re engaged. It doesn’t feel like work anymore. They enjoy it, and they’re fully concentrated, which means you’re going to get better results.

MvdB: What is the relationship between an organisation’s values, and the behaviour of the people that are a part of it? Is it difficult to align employee’s values with that of the organisation?
MP: Individuals already find it very difficult to live by their own values, especially when they’re facing professional and personal pressures in their lives. Getting an organisation of 10,000 people to adopt the same values can seem insurmountable, but there are mechanisms that can help. If you want to focus on a particular value, such as autonomy, for example, then you need to define what that looks like, and the trade-offs that come into play. For instance, autonomy means employees have the freedom to determine where they complete their work as long as they meet the performance standards, but this cultural value of autonomy may cause coordination issues at times, so how can the organization protect against those side-effects?

Leadership is also crucial. Leaders have such a disproportionate influence on the culture of a company. Not only are they implementing the values that they care about and the expectations that are important to them personally, but leaders are also directly in the spotlight, and people look at them to understand what an organisation is all about and what it sanctions.

The third area is looking at company practices, routines, and policies. Do they all facilitate and strengthen the behavioural expectations of the people working there? If a leader suppresses an employee’s challenge or diminishes an employee’s concern, for example, it shows that the company doesn’t truly want empowerment even if it claims it. In contrast, a company that’s true to its value of empowerment will seek such challenges and concerns by employees as learning and growth opportunities.

Companies must reflect on their values and policies – do they encourage the behaviours that they want, or at times, are they diluting them and actually preventing those behaviours that their values supposedly encourage?

MvdB: If you’re interviewing leaders for a position in a company, how do you assess their compatibility or ability to adopt the company culture? Is it their ability to change? Is it about having a growth mindset? Or are there other dimensions that you need to take into account?
MP: The companies that are truly stars when it comes to the culture hire slowly and have multiple layers in the hiring process to make sure they are hiring the right people. One of those layers is typically screening for the cultural fit, such as the right personality or growth mindset or learning attitude.

After that, companies often present specific case studies to see how potential new employees would operate and react in these organizational situations, to see if their decisions or actions would align with the company’s principles. The final layer, which can be the most effective at determining cultural fit, involves having potential employees actually work at the company, paid on a trial basis.

MvdB: How realistic can we be about the speed of cultural change, because it’s clearly a journey that involves many things. Can it get faster traction than people perhaps think?
MP: If employees understand the benefits of any type of change, it’s much easier to get them on board. Changes in behaviour can be a slow process, especially when you need to bring awareness to a new set of values that justify them. Does everyone agree to them? If not, organisations need to help employees understand and evolve, before holding people accountable to them. That takes time.

Ultimately, culture is about how we do business, how we solve problems, and how we work together. That’s why it’s such a powerful mechanism – and that’s where technology comes in.

MvdB: Where should people start when it comes to culture, technology, and their digital transformation journey?
MP: We must ask ourselves why we are adding a particular new technology to the workplace. What problem is it solving? What is it helping us do?

A lot of times, technology is sold in terms of features, and that may attract attention, but it doesn’t change behaviour and it doesn’t sustain persistence because the benefits aren’t entirely clear. Is this technology going to create a strong desire to use it because it has multiple benefits to our work? Is it highly visible, so that it gets used? Is it intuitive? Does it encourage habits and routines? These are all critical starting points for technology introduction and change, and I’d love to see your perspective on this, given your unique position at Microsoft.

MvdB: I would take Teams as an example. What does it do about bringing out the best work in people? And what do you do if you’re a big enterprise company providing this technology to three generations of people working in the same workplace? How do you create an environment where everybody will have the opportunity to feel that this is part of how they can do a better job and collaborate?

Microsoft Teams has taken these thoughts into account, rather than just churning out sets of features without purpose. Teams is seeing great usage from our customers, which is telling us that it was designed with meaning and thought behind it, versus potentially rolling it out with sets of features that no one is using.

The way technology is evolving can not only create an environment that enables people to do their best work, but that also supports the cultural and behavioural changes needed to transform.”

MP: Another key point to the adoption of technology, are the differences in not only employees’ ages, but also people’s preferences and technological skills. Good organisations bring awareness to the different ways that people work, before coming to a collective agreement with their employees about how new technology, like Teams, can work for everyone going forward. People are then held accountable to those common and agreed-upon rules.

MvdB: What do you see as the future of this importance of culture and technology, and what are the trends that are pointing to that future?
MP: The core aspects of culture—values, behavioural norms, and problem-solving methods—are always going to be a major component to a company’s success, and these fundamental aspects are not going to change going forward. In terms of forecasting culture, what you’re going to see is that the specific content of those fundamental aspects is going to be shaped by new technology as it changes the way that we see and do business.

Thus, the domain content of what culture is, what it means, and what the values are is changing. Transparency is a good example. Should an organization value transparency and be proactive about showing We’ve seen poorly handled examples of this where videos are posted online in situations where employees treat customers in ways that aren’t aligned with their company’s stated values. Because technology is forcing companies to become more transparent, I think good companies will start to value it more, and get ahead of it. This is one way in which things will move forward and evolve.

Read the conversation in full here.

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