Eight Different Types of Corporate Culture

Self-knowledge can be the most important form of insight at the individual level, but it is equally valid at the collective layer. Every organization of any size is governed by spoken and unspoken cultural dynamics that dictate the way in which people interact with each other. Individuals who run afoul of those norms and expectations may find themselves ineffective at best and alienated or terminated at worst. It is essential that all workers and leaders understand and appreciate the culture of their organizations to maximize their effectiveness and contentedness.

Multiethnic diverse group of business coworkers in team meeting discussion, top view modern office with copy space. Partnership professional teamwork, startup company, or project brainstorm concept

There are many ways to define the primary types of corporate cultures. All organizations have a purpose, a primary method for making decisions, a means by which status is attained and a method for conflict resolution. By understanding these dynamics in detail, a job applicant or new employee can better ascertain what they are getting into before conflicts or mismatches arise.

Corporate culture descriptions are a form of generalization. The larger a group gets, the more exceptions may emerge. Typically, these exceptions will tend to underscore the greater truths and characterizations of the whole. Like any generalization, one needs to be aware of differences and diversity within the framework that describes the organization. The list below is intended to be representative, rather than comprehensive. Here are eight distinct types of corporate culture, explained:

Hierarchical/Seniority-Based Culture
A traditional company organization celebrates hierarchy and seniority. In this type of culture, people may hold titles such as assistant senior director or have lapel pins and desk trophies that illustrate the years of tenure at the organization. Governmental departments and union-influenced organizations like public schools very often conform to this description. Pay and benefits are linked to seniority, and pay bands are rigidly enforced. The good news is that a new employee can know what to expect. The bad news is that change can be difficult to enact, and those eager for merit-based advancement may feel stymied.

Mercenary Culture
At the other extreme are companies where an “eat what you kill” ethos has no patience for seniority. Those who sell the most or bring in the most revenue are better rewarded. Everyone in this type of work culture is aware that there is a scoreboard keeping track. Investment banks and increasingly corporate law firms operate this way.

Egalitarian Culture
Some startups and nonprofits succeed with a culture of egalitarianism. Everyone from the CEO to a frontline worker feels empowered to speak up and suggest changes and improvements. Individuals feel like their input has equal value to anyone else’s. Of course, sometimes companies see themselves as egalitarian when the actual practice is anything but equal. Another frustration can be slow decision-making when a consensus is not quickly attained.

[ READ: Reasons to Quit Your Job. ]
Clan Culture
At these organizations, the sense of mission, loyalty and collaboration is so clear as to create a keen sense of belonging. These companies can be quirky with certain behaviors that only insiders are privy to understand. “That is just the way we do things here,” can often serve as justification for a company that operates in this type of culture to stifle change or innovation. For those on the inside, these cultures can be comforting and welcoming. For those who think differently or advocate for change, they can feel very alienating.

Elite Culture
In companies with an elite culture, such as management consulting firms, employees take immense pride in the difficulty of gaining a position at the company. Like the U.S. Marine’s adage, “Maybe you can be one of us,” there is a sense of exclusivity that most people do not qualify for a spot at the company and as a result, the prestige of membership is a reliable source of fulfillment. These organizations can feel like elite colleges where current students and alumni share pride in belonging. On the downside, this type of workplace sometimes fosters a culture where there is little patience for or appreciation of differences and those who don’t belong.

Experimental Culture
Sometimes described as an “ad hoc” culture, experimental cultures are defined by rapid iteration and lack of structure. Engineers and product development professionals call this approach rapid prototyping. These organizations think of a new product or method, decide on what is minimally viable to define success, and execute to test the outcome. At their best, these often-young companies and startups blaze new paths to innovations and achievements where others have failed. At their worst, these organizations can stress out teams and individuals by constantly changing the definitions of success and moving the goal posts.

Cause-Based Culture
Some organizations are defined by a cause or purpose that transcends the entity itself. There is passion for a subject that drives all decision-making and prioritization. Whether it is a political outcome, a social goal or even a shared interest or purpose, the members of this team agree that their purpose is clear and important. Curiously, not all nonprofits or social movement organizations are truly cause-based after a time, but most started that way at their inception. Idealists will feel at home in this culture if their values and interests align with those of the collective. The astute job seeker will work to ascertain that the cause is genuine and current or vestigial in nature before committing to such a team.

Innovation or Creative Culture
Music labels, film studios and advertising agencies are a few examples of industries that are often innovation or creative oriented. Creating or discovering artistic accomplishment may be the highest achievement in a company culture of this kind. Beyond the arts, some science-oriented organizations equally value innovative approaches to biomedical solutions or engineering accomplishments. While invigorating for the artistically or scientifically creative, these cultures can be characterized by a “what have you done for me lately” atmosphere that is quick to forget yesterday’s achievement in favor of today’s activity.

The culture of a company can be a large determinant of success for employees. The astute job applicant or new employee will have a keen sense of an organization’s values and behaviors early in the process of joining a new company. Assessing fit is a matter of finding the organizational culture that best complements the work style and personal ethic of everyone.


Gratitude Research Reveals Why Saying “Thank You” Can Help Win The Talent War

These are stressful times—and nowhere is this more evident than in the workplace. ‘The Great Resignation,’ in which millions of workers are choosing to quit their jobs in search of something new, is in full swing. What’s worse is that what we’re seeing now might only be the tip of the iceberg. According to research from Microsoft and Gallup, some 41% of the global workforce, and nearly 50% of employees in the U.S., are actively looking for a new job.

Yet, according to new research from the firm Workhuman, employers might be overlooking the most powerful weapon in their arsenal when it comes to keeping and attracting talent: Saying thank you. As we celebrate Thanksgiving this week, there’s no better time to start giving thanks where they’re due.

The numbers tell the story
While it might seem like an oversimplification, giving thanks can be a great way to positively impact someone’s day and work, says Rosette Cataldo, Vice President, Performance and Talent Strategy at Workhuman. In fact, according to her firm’s survey of some 3,500 global workers, how recently they received thanks can be an impactful indicator of a person’s willingness to stay at their current company.

The study found that:

Workers thanked and recognized for their work are half as likely to be looking for a new job (26% versus 49%)
Thanked employees are twice as likely to be highly engaged at work (60% versus 32%)
Employees who feel recognized are three times as likely to think their work has meaning and purpose (53% versus 18%)
And employees who feel recognized also report being happier at work (47% versus 11%)

Keeping it real
Of course, saying thank you must be more than just a box to check. “Gratitude is something that you truly feel,” says Cataldo. Authentic gratitude has the biggest impact on those around us. According to Dr. Robert A. Emmons, a Workhuman speaker and leading gratitude expert, gratitude can be defined as:

An affirmation of goodness
A recognition that the source of goodness is outside of ourselves
“When you express gratitude or offer recognition you should never expect something in return,” says Cataldo. “Otherwise, the gratitude or recognition can come off as forced and inauthentic. It’s difficult to say whether employees will feel manipulated or not, but it is possible that it won’t have the positive impact intended.

“If this is ever a concern, always establish your intention, and make sure it’s a genuine one, before giving recognition or expressing gratitude.”

Giving thanks
While it might be tempting to thank employees only for performance-based accomplishments—like hitting a sales target—it shouldn’t start or stop there.

Cataldo points to examples like thanking someone for lending a hand on a project, providing a different perspective in a brainstorm or meeting, being a positive influence in the workplace or even for remaining dedicated and committed to your organization through the difficult events we’ve all faced over the past year.

“Find little, but impactful moments to recognize your employees and don’t just look ‘down’ the org chart but ‘up’ it as well,” she says. “Start by highlighting smaller milestones or difficult projects. If the team had to quickly pivot to meet a tight deadline, that’s a great success to celebrate and remember to highlight the impact it had on the business, but more importantly the people it positively affected.”

Tackling burnout
The events of the past year have no doubt been difficult for everyone. In fact, according to Workhuman’s report, 64% of people reported that they’ve experienced burnout in their career. Alarmingly, 41% of workers said that burnout happened in the past few months.

Regularly expressing gratitude and giving recognition is a great place to start working on morale, but unless steps are taken to ease the pressure workers are feeling, it could be perceived as insincere and even manipulative. Companies should listen when employees share how supported they feel in the workplace—as well as their ideas about how to improve those conditions.

That can often begin by taking the time to listen to employees at your regular check-ins about how you might make things easier for them. “People want to feel heard, included and supported,” says Cataldo. “If your employees are tired and burnt out, they need to feel empowered to speak up so that you can address those issues. Incorporate opportunities for your employees to provide consistent feedback on the current work environment and create an environment that feels safe to share concerns, without fear of retaliation.”

Then, of course, be sure to thank them for their insights—and give them serious consideration.

A new thankful routine
Finally, expressing gratitude should never be treated as a one-off transaction. Rather, embrace the idea that there are moments to celebrate and reinforce on a daily basis. The key is to keep your eyes open for positives and then share those moments back to your employees.

If you can make gratitude a part of your routine, you’ll build morale, trust and stronger personal connections across the organization.


Win the Leadership Marathon

Exercise once, and calories burn once. Exercise regularly, and your metabolic capacity—or your VO2 max, your body’s ability to take in oxygen and circulate it into the blood of working muscles—can actually increase. VO2 max is a pretty good barometer of one’s cardiovascular fitness level. For mere mortals like me, a normal VO2 max is about 40 to 45. World-class cyclists, runners, and cross-country skiers can register numbers north of 80.

There’s a parallel in business today. Most organizations deal with change as it comes, as best they can, like playing the whack-a-mole game at the amusement park. A challenge pops up; you hit it back down and move on, only to have another pop up even faster. Successfully manage through one organizational change, and you can check that initiative off the list as completed … at least until the next one arises.

But as with the body’s VO2 max, superior corporate performance comes from increasing an organization’s metabolic capacity for change. Leaders don’t want their teams to simply get past a given change. They want to increase, over time and with the repeatability of an elite athlete, their capacity for change.

The value of strengthening this change muscle became clear to me while my colleague Kevin Murphy and I were researching the factors that contribute to an organization’s ability to change. We found that this “Change Power” is comprised of nine different elements: three leadership elements (purpose, connection, and direction), three organizational elements (development, flexibility, and action), and three teaming elements (choreography, scaling, and capacity). You can read more about our work in this summer’s edition of Harvard Business Review.

Capacity is one of the most important of these elements. It defines how much an organization can change and how fast. It is a useful measure and one most leaders want to figure out how to increase.

But organizations, like the human body, do not have an infinite capacity to absorb change. People, and organizations, are like a sponge. There is a limit to how much change can be poured into them. Once the sponge is saturated, anything additional poured onto it simply runs over. In this context, a relevant question for leaders is often “How full is your sponge?”

There is an upper limit to our ability to adjust to change, but with regular training, most people and organizations can improve. So, an even more powerful question to ask may be “How can I increase my sponge’s absorption rate?”

It’s an important question with a complicated answer. There are a few foundational things that most leadership teams tend to do, and then there is a second set of activities that we see in practice only at the frontier, among the companies with the highest Change Power.

Increasing capacity always starts with systematically identifying current and potential bottlenecks where efforts might slow down. These are where you as a manager focus your efforts. There are more and less sophisticated ways to do this, but a good place to start is with stimulating a simple dialogue about which functions or departments feel overloaded. From there, many options exist, including removing activities that have little return, sequencing work in a way that’s less disruptive, adding resources, reassigning managers in critical positions, and providing them with additional coaching to improve their personal capacity to absorb change. As a general philosophy, the most effective teams often adopt a “do less better” approach. This requires the courage and discipline to say no, or at least “not yet,” to good initiatives and ideas, in order to ensure the mission-critical ones have the space and resources to thrive.

Leading companies are going further and employing more advanced capacity-building tactics. One example: Human resources departments are increasingly using sentiment analyses and other techniques for listening to staff, such as networks of change ambassadors and focus groups, to help identify areas of potential change overload that may affect performance.

One global firm established a network of people around the world who regularly responded to surveys and participated in focus groups. The group served as an early warning system to detect pockets of the company that were feeling overloaded. Once these crunched teams were identified, additional staff with the crucial skills would be dynamically deployed to teams working on high-priority, must-win missions. Leadership teams then periodically stepped back, assessing the signs of potential overload and, with an eye to company strategy, rebalancing work as needed.

Deploying these kinds of techniques, it is possible for organizations to make their sponge more absorbent. In the short term, that’s done with thoughtful sequencing and prioritization of work, and by adding resources where they will be most valuable. In the long term, it’s by increasing the VO2 max equivalent of the organization, its metabolic capacity for change.

So, one more question: What are you doing to expand your capacity for change?


The Job Market Is Going Crazy And It’s Going To Get Worse. How Do We Recruit?

The labor market has gone a bit crazy. In the United States, there are more than 161 million people working and 15.7 million jobs open. This means that roughly one in 10 seats in your office are empty, and you’re competing with everyone else for staff.

Adding to this frenzy, the job creation continues. This month more than 530,00 new jobs were created and the unemployment rate is now down to 4.6% (and dropping). As the Biden administration pours even more money into the economy, we can expect this trend to continue. In fact, Citibank’s economist unit believes that next year we will have more than 20 million job openings in the US, bringing the percentage of seats unfilled to one in eight.

(PS the EU is experiencing similar growth. In Q3 the EU unemployment rate dropped to 6.3% and well below 4% in Germany and other countries.)

Wages are going up as well. The BLS research shows that average wages are rising at over 4.2% and in Q3 alone jumped by 1.5%, the highest growth on record. Lower-paid workers have seen the biggest gains, with pay rising for employees at restaurants, bars, and hotels by 8.1% in the third quarter from a year earlier. For retail workers, it’s jumped 5.9%. This means job seekers are looking for more money, they feel more empowered than ever, and they’re really looking around.

In fact the Quit Rate, the number of people who voluntarily leave positions, is now 3.4% (4.4 million last month), by far the highest we’ve ever seen. So in the middle of all these job openings, almost a third of Americans will voluntarily change jobs this year. McKinsey’s research found that two-thirds of these job seekers do not have a new position, so people are feeling very optimistic about their opportunities.

So think about the numbers. One in ten (16 million) jobs open, over 4 million people leaving their jobs each month, and wages increasing at the highest rate ever. This is a crazy job market.

All this may be great for the workers, but it’s a huge burden for employers. As Larry Summers put it, “there is no slack in the labor market.”

Companies are finding it extremely difficult to hire and recruiters are in high demand. In fact, there are now more recruiter jobs open than software engineers! We need to take think about recruiters as the most valued workers we have!

What Should Companies Do?

Let me start by observing that three things are going on at once.

First, the job market itself is on fire. There are so many jobs open that almost every position feels like it’s tough to fill. Lots of HR managers tell me they’re posting jobs and seeing no qualified candidates at all.
Second, the nature of work is changing. With so many jobs disrupted by the pandemic and digital transformation, we have to search for skills and culture fit, not just experience. Many of the new positions we’re creating don’t have large pipelines of experienced candidates.
And third, the psychology of job seekers has changed. Candidates feel burned out, empowered, and ready to negotiate.
1/ Focus On Employment Brand, Culture, and Leadership

The biggest factor in recruiting great people is creating what we call an Irresistible Company. In other words, if your organization is not known for its good deeds, fair pay and work practices, and strong commitment to customers and the community, you’ll have a hard time finding people.

People don’t just look for a job – they look for a company. So if your company is unknown or poorly respected, they’ll look elsewhere.

Yes, wages matter. People will come to companies that pay more, but in our list of 80 practices for recruiting, total pay ranks pretty low (number 72 out of 80 in creating an attractive workplace). The real wage issue is fairness: you have to make sure your wages are fair and you treated people equitably: this factor rates #6 in importance.

2/ Identifying Culture and Skills Fit

In a more normal labor market you would typically look for someone who has done this job before. In other words, you look for specific job experience, validate the candidate’s success in prior roles, and call their references for feedback.

Today, as jobs change faster than ever, it’s ever more likely you will hire someone who has some of the experience you need, but is more likely to be hired based on skill, not experience. So this means you’re hiring for culture, intelligence, ambition, and potential.

And this means recruiters are more important than ever. Our new research (coming out early next year) shows that high-performing companies develop recruiters who can assess fit, culture, and growth mindset as well as skills, job fit, and experience. In fact, one of our findings is that “Human-Centered Recruiting” is more important than ever.

Not only does our research bear this out, my personal experience does as well. I’ve hired more than 50 people in my career and in most cases when I hired someone with deep experience but not a culture fit, I was sorry. The new employee came into the company ready to redesign and “fix” everything that was broken, and in many cases created more problems than we already had.

I’m not saying that experience is not important, but in this job market, you may have to live with less experience and rely on skills and ability to grow.

3/ Don’t Chase Pay.

For many jobs, particularly hourly and highly regulated roles, you must pay what the market demands. This means you may have to raise hourly wages, add more benefits, or even pay a bonus to get someone to join. But be careful, this is a dangerous strategy to follow.

Remember that the most expensive person you hire is someone who doesn’t work out. If you “chase pay” to get someone to join your company, you risk alienating existing employees and possibly hiring someone who feels so empowered they don’t perform to your hopes. So unless the person is a senior executive or well known by your team already, I’d be careful about “chasing pay.”

Right now this is a challenge. We are trying to hire a professional for a particular role right now and one of the candidates told me during the interview that she was making $140,000 in her current role. After several weeks of interviewing she came to the final interview and told me she wouldn’t accept a job for less than $200,000 per year. I was floored.

Of course, I decided not to hire her, but the message here is clear. Job seekers feel very emboldened right now, so you have to be careful about chasing pay.

(One of our manufacturing clients told me many of the candidates with accepted offers don’t show up for work. When she calls them they tell her “I found a job with higher pay over the weekend, I’m not coming.”)

4/ Don’t Over Extend Yourself.

This gets me to my fourth point. We are at the very peak of a 14-year economic cycle, the longest upswing in our country’s history. Some time in the next year or so the economy (and stock market) is going to slow down. If you hire like crazy and overpay people for the next year, you’ll find yourself with a lot of challenges ahead.

And remember this. Even though you may be in a hiring frenzy, bringing in too many people can backfire. Each new employee creates a burden for onboarding and may change the culture of the team. I’d be careful over-hiring at this stage of the economic cycle.

5/ Focus on Recruiters, Not Technology.

Finally, take good care of your recruiters. As I discuss in this weeks’ podcast, recruiters are still the key to great hiring. Yes, recruiting technology is amazing – but it’s a lot like self-driving cars. The tech helps you stay out of trouble but you still have to take the wheel.

As I discuss in the podcast, a new era of Human-Centered Recruiting has arrived – empowering the recruiter themselves. I’ve interviewed hundreds of talent acquisition leaders over the years and they always tell me the same thing: great recruiters hire great people.

Great recruiters are good at many things: they know your company’s culture, they work closely with hiring managers to understand your jobs, and they have a deep knowledge of the market. Not only do they know a lot of people, but they can search people out, assess their readiness and fit, and convince them that your company matters.

6/ Take Care Of The Employees You Have.

Let me leave you with this. If almost a third of the workforce is going to change jobs this year, you don’t want them to be the workers in your company. In order for the Quit Rate to be 4.3%, there have to be some companies losing a lot of people every month. That shouldn’t be yours.

Now is the time to really focus on Employee Experience, and EX is all about treating people well. Spend some time getting to know the people you have, building a culture of internal mobility, and taking care of your leaders. It’s the most important recruiting strategy you have.

Remember this: recruiting is the most important thing we do. If we don’t bring the right people into the company, no amount of management can fix the problems.

It’s a crazy job market out there. Now is a time to build your employment brand, focus on your culture, and get back to basics and recruit for potential, fit, and growth.


How toxic working cultures impact organisations

A workplace free from toxic and problematic behaviour is a right, not a luxury for employees. Every employee in every organisation should feel safe and happy in their workplace as, at the end of the day, many of us spend more waking hours at work than we do at home.

The importance of adopting a people-centric workplace culture and tackling problematic behaviour should be of upmost important to every business, no matter the size or sector.

It’s been proven time and time again that organisations who put a positive employee experience at the heart of their business, and who focus on creating safe, inclusive, and supportive environments, thrive and are more successful. So why are some organisations still struggling to get this right?

Problematic workplace cultures can have a long-lasting, damaging effect on the employees directly experiencing the behaviour, as well as those witnessing it. Environments where bullying and harassment thrive leads to high levels of attrition, resulting in organisations with a deep-rooted negative culture losing great talent. This sentiment can often filter through to external stakeholders, impacting the organisation’s reputation.

Problematic workplace cultures can have a long-lasting, damaging effect on the employees directly experiencing the behaviour, as well as those witnessing it
Prioritising a positive culture, which is supportive, not only helps foster good mental health, but is essential for a progressive, modern working environment. However, almost half of the UK’s workforce say a toxic workplace culture is impacting their mental health, showcasing that it’s time for leaders to shift this to the top of their agendas to instil change.

Impact on the employee

First and foremost, toxic cultures and problematic behaviour in the workplace can have a real lasting impact on the people who experience such instances.

Two in five employees across the UK have experienced problematic behaviour, such as bullying, harassment or discrimination at work; with 42% confirming toxic workplace culture has impacted their mental health.

On how experiencing problematic behaviour at work impacted them, two thirds of those who have experienced problematic behaviour at work confirmed it affected their confidence and ability to find a new job, whilst 67% suffered from anxiety as a direct result of workplace bullying. This led to 71% having to have therapy, demonstrating the prolonged impact negative workplace culture can have on individuals.

What’s more, more than a third of employees in the UK have felt silenced on issues that matter to them in the workplace, while 29% have taken time off due to an incident that happened at work, such as bullying, harassment, discrimination or sexual misconduct.

A problem for productivity

Organisations not prioritising a positive culture will eventually falter, as productivity, creativity and growth rely on workforces that feel happy, safe and secure.

Negative workplace culture and employer traits are resulting in demotivated workforces, dipping productivity and many employees bearing the brunt of unacceptable behaviour. In fact, 42% of UK employees have previously left a job due to negative workplace culture, while 41% confirmed bad workplace culture has impacted their productivity and 34% have been less engaged with their job. Furthermore, a staggering three quarters have called in sick due to not wanting to see somebody with whom they have a negative relationship.

It’s no surprise over a third confirmed an incident, such as bullying, harassment or discrimination, at work has led to them not trusting their employer. But what could employers be doing to protect their people?

Actions employers could be taking to protect their people

Not tackling toxic cultures and problematic behaviours within an organisation can have a harmful impact on the people at the heart of those instances, and leaders should absolutely have the safety and wellbeing of their employees at the top of their agenda.

Not only can these issues have a devastating impact on the victims, but this sentiment can often filter through to external stakeholders, impacting the organisation’s reputation and ultimately their bottom line.

Many of these incidents could absolutely be avoided and there are preventative tactics employers could be adopting to minimise the risk on their people, by protecting them. The data revealed that while the numbers varied between one-third and one-in-five across the sectors, many employees wouldn’t get involved if they witnessed somebody being bullied through fear of repercussions. However, the vast majority across all sectors surveyed, said they would be much more likely to report an instance of bullying/harassment if their workplace had an anonymous platform to do so.

Anonymous reporting can provide employees with the confidence to speak up about bullying/harassment without having to factor in potential barriers. The safety this can provide could be the difference between reporting and choosing to suffer through bullying or harassment in silence. In addition, it can also provide useful data to employers about the behaviours and cultures that exist in their organisation, helping them to spot any potentially harmful patterns and take the appropriate action.


How to make employees feel valued

Employees want to feel seen. They want to feel valued. And they want to feel like their work matters at a higher level. McKinsey recently reported a record number of employees are quitting their jobs or thinking about doing so. More than 15 million workers in the US quit their jobs between April and September of 2021. In the last few months, trend scouts have even said that quitting your job is a new form of self-care.

But this mass exodus is a costly trend for companies; 40% of employees said they’re somewhat likely to quit their jobs in the next 2-6 months. In the US the 40% of employees that quit in the last six months did so without a job lined up. McKinsey calls it ‘The Great Attrition’ and predicts that it will only continue to grow.

So why are employees leaving? According to their findings, McKinsey said there’s a disconnect between what employees want and what their employers think they want. 

Employees want to feel valued by their companies, they want to feel a sense of belonging, they want flexible work schedules, and they want opportunities for advancement. According to the studies, employers don’t seem to place the same value on these factors. Both employees and employers are aligned in that both believe work-life balance is essential for keeping employees around, but employers seem to think that most employees’ decisions to leave are based on finances or simply finding better offers elsewhere.

With this information available, it’s essential that companies take a proactive approach to retaining their employees by providing flexible workplaces, opportunities for growth, and a collaborative and community-based office culture.

Those three goals can be achieved through one shift: intentional training initiatives that are adaptable, engaging, and provide employees new opportunities to learn and grow.

Implement training where employees are located 

Employees want flexibility. Post-pandemic, many companies have embraced hybrid or remote work environments. This is becoming the standard that employees want, and it requires that employers understand the needs employees have in order to be successful. Companies can make moves to boost employee loyalty by providing training tools that set them up for success.

Learning platforms, mostly legacy platforms, are out-of-date and don’t meet the modern employees’ needs. Systems require multiple apps to run a course, or they are, quite simply, very boring and require employees to watch a video or click through presentation slides for hours on end. Outdated training tools won’t help employees succeed, and they’ll only increase frustration.

In order to retain employees, companies should invest in app-based training tools that correspond with the platforms their employees already use. Slack, Salesforce and Microsoft Teams are some of the most popular workplace apps in the market (regardless of industry). Companies should prioritise training tools that correspond or integrate with these applications. This makes the platforms more flexible for everyday use and encourages employees to complete training. It reduces context switching and promotes completion because the content is readily available within the employee’s everyday workflow. A parent who works from home could start their training at their home office and continue listening to training tools while waiting for their child at soccer practice by using a mobile version of the learning management software.

Support employees’ needs beyond the office

This is where McKinsey found a significant disconnect between what employees’ value and what employers think their employees’ value: the future of their careers at the company. Modern employees aren’t necessarily leaving their companies because of inadequate pay, they’re leaving because they don’t see opportunities for advancement.

Companies can provide a clear trajectory for their employees by offering steps for advancement through the training tools they use. Of course, every career advancement requires experience, further training, and perhaps even a set of certifications. Smart digital learning management systems can be the medium through which employers provide opportunities for advancement.

Using AI-based technology, employers can encourage employees to expand their knowledge by offering further training or certification courses through a learning management system. The AI technology comes into play here as data is collected about the employee’s learning behaviours. The platform can automatically recommend new courses based on an employee’s job title, their experience level, the courses their peers are taking, or even their interests. Companies can create a course catalogue that includes everything from industry standard training to leadership courses or mental health educational tools.

These courses take care of the whole employee, showing them that the company is willing to invest in them now and in their future, in their personal and professional development. The end goal of training is that employees feel valued, not just for their output, but for their potential, for their own skills or traits, and for the opportunities ahead of them.

Provide opportunities for connection and collaboration

Above anything else, McKinsey found that employees leave companies because they don’t feel valued or that they belong in their company. However, employers don’t believe that this is what makes employees leave. The challenge with this disconnect is that it is less tangible. Creating a sense of belonging takes multiple steps and perhaps even a shift in company culture.

Employers can begin fostering a collaborative culture in the way that they train their teams. From the start, employers can create collaborative onboarding experiences that give employees opportunities to interact with their peers and leaders. The next generation of learning management systems will provide companies with opportunities to encourage connection by including interactive elements within each course and creating easy-to-access collaborative tools, like forums or video calls, all within a single platform delivered through the same extensible apps employees use daily.

Employees want to be connected to their team members, even if they aren’t working side by side in an office. Companies can build loyalty, encourage camaraderie, and improve retention by providing employees these opportunities in every aspect of their jobs, from onboarding to everyday processes to upskilling.

This is a critical moment for companies everywhere. Employees are considering leaving their jobs to find places where they will feel like they belong, know that they are valued, and see a future for themselves. When companies invest in proper training tools that assist employees from their first day through their career, they encourage loyalty and show employees that they matter beyond a paycheck. 

source: https://www.trainingjournal.com/articles/features/how-make-employees-feel-valued

The Three Questions Leaders Should Always Ask Their Teams

The executive team at Ford Motor Company in the 1950s made one of the best decisions and then one of the worst decisions in company history. Our research and experience at the Wharton School tells us that the Ford team is not alone in its schizophrenic decision-making; even the smartest groups often make poor choices.  Understanding why can help you ensure that you consistently get the best out of your top team. Let’s look at what went right, and then wrong, at Ford.

In the early 1950s, Ford’s leadership team drafted a plan to get rid of the V-8 engine in all cars. Many of the company’s top executives had spent years at General Motors and, since GM’s highly successful Chevrolet did not offer a V-8 as an option, they saw no reason why the Ford car should either. They were ready to move forward until a product planner, Chase Morsey Jr., asked to plead the case for the V-8 in front of the executive team. Morsey had loved the roaring engine ever since it powered his very first car, a Ford coupe. He touted data showing customers would pay more for the V-8 and that they could reduce costs with improved manufacturing techniques. Ford’s executive vice-president Ernest Breech, pressed Morsey hard, but the product planner had an answer for Breech’s every question. Eventually, he and the rest of the executive team voted to keep the engine, a decision which they later credited with helping them catch up to Chevrolet.

Just a few years later, the company developed the Edsel as a new mid-price car to capitalize on the rising incomes of a growing post-war American middle class. The entire process was cloaked in secrecy until the initial unveiling of the design for the executive team. They gathered at Ford’s styling center, where an Edsel prototype was parked behind a curtain. For nearly a minute after the curtain was lifted, the audience sat silent. Finally, Breech, then chairman of the board, started clapping. Following him, wild applause erupted as the crowd had expressed its enthusiastic approval. Consumers greeted the Edsel with decidedly less enthusiasm than the Ford executives. In the end, Ford is estimated to have lost $250 million on the car — over $2 billion in today’s dollars.

Why did the team with the foresight to save the V-8 create the Edsel debacle?  When it came to the V-8, the Ford demonstrated an impressive ability to avoid group-think. Many of the executives who heard Morsey make his impassioned plea for the V-8 had worked together for years at GM, yet they resisted the common tendency to think like the people one works with. Not so with the Edsel. Breech and the other executives displayed the very biases they avoided so impressively in their encounter with Morsey. For example, first-hand accounts suggest it took hold in that initial burst of applause and choked off productive discussions for years afterward. Over time, the team’s thinking became increasingly insular on this and a variety of other aspects of the car.

Our tale of two decisions shows that top teams never overcome the need to focus on the fundamentals of high-performance collaboration. While there is no guarantee that your top team will always make V-8-type decisions and avoid disasters like the Edsel, we have identified three questions that will help you stay on track. We recommend devoting at least part of a team meeting once a month to reviewing these three essential questions:

1. Are we still having productive discussions?

Like the executives who ran Ford Motor Company in the 1950s, top teams produce mixed results. One reason is the tendency top teams have to cascade toward a decision without adequately assessing alternatives, as was the case with the Edsel. Given this tendency toward group-think, it pays to assess the strength of your agreement or disagreement by responding to a few simple statements regarding your top team’s interactions. To make this easy, we suggest your team take a brief check-in survey adapted from management scholar Anneloes Raes. If your answers fall more to the right side of the scales, then you should ask whether your team is really just a group of lone wolfs or even one that sends results-impeding ripples across your organization.

2. Do we need to realign our priorities?

Studies show that high-level agreements about goals can mask deeper misalignments that affect top team performance. When these differences go unaddressed, teams are slower to make decisions and implement them or implement them in the wrong way. A key difference in how the Ford executives handled the V-8 and Edsel decisions, is that in the first case, they were willing to readjust their priorities, while in the latter, goals were never up for discussion. Once you begin having more productive discussions, make a point of checking in on your strategic priorities to ensure they are in alignment with your organization’s capabilities and your customers’ needs.

3. Have we become too isolated?

Just as members of a top team need to make sure they are aligned behind shared priorities, the whole top team should ask whether it is aligned and connected enough with the rest of the organization and the broader environment. In this sense, every member of the team should make organizational relationship-building a priority. Studies reveal why these relationship networks are essential: 90 percent of the information a top team uses to make decisions comes through informal channels rather than formal reports. Bringing fresh perspectives to strategic planning meetings whether through new data, or new voices such as Morsey’s, can help you avoid the blind spots that plague all teams.

The facts are clear: Even the smartest leaders can make bad decisions and past success is no guarantee of future performance. To avoid the pitfalls of the Ford executives, consistently refresh your top team’s decision-making process by asking these three simple questions. Don’t let your team of virtuosos produce the next Edsel.

source: https://www.bain.com/insights/the-three-questions-leaders-should-always-ask-their-teams-infographic/

Using Corporate Social Initiatives to Build a Purpose-Driven Organisation

In addition to creating value in the marketplace, companies are increasingly expected to minimise their negative impacts (e.g. reducing their carbon emissions) and to proactively make the world a better place. While businesses differ in the speed and effectiveness with which they have been responding to these pressures, it is safe to say that more companies than ever appear to be making a genuine effort towards becoming more purpose-driven.

Until recently, corporate initiatives intended to benefit society were mostly run as stand-alone philanthropy or corporate social responsibility (CSR) departments, with little connection to the mainstream business activities of a firm. And this often ended up being the worst of both worlds: a furnace for cash sub-optimally spent for appearance’s sake, with limited benefits to show in terms of real impact.

Leading companies are moving away from ad-hoc societal engagement and towards a more integrated strategy. That is, they pursue societal and commercial goals simultaneously. As researchers interested in this issue, we have been closely following how some of these firms use what we call “corporate social initiatives” or CSIs as a tool to integrate societal concerns into the core of their business.

CSIs are run as business ventures, often involving employees who move between the company’s traditional commercial activities and projects with a more explicit societal agenda. These ventures take the view that integrating impact goals with business strategy is more practical within a carefully nurtured corporate venture than a sweeping, organisation-wide transition.

Our extensive, multi-year research programme in partnership with a global consulting firm (let’s call it “ConsultCo”) shows that CSIs are indeed a promising tool to help companies become fully purpose-driven. At the same time, our research also reveals ways in which such initiatives remain works in progress and require careful monitoring.

ConsultCo has a CSI that relies upon an intricate system of interlocking incentives. Its consultants can agree to take a break from working with typical corporate clients and instead spend up to six months helping NGOs or development agencies (often in emerging markets) sort out organisational issues. Importantly, these so-called impact projects are run as businesses rather than on a pro bono basis.

The cash-constrained relief organisations are charged only a fraction of ConsultCo’s usual rates. Any consultant joining an impact project has to agree to a significant salary reduction, which many happily do in return for the privilege of being part of something that helps society. Such salary cuts exceeded US$28 million just in the first decade (2003-2013) of the initiative.

ConsultCo’s leadership has meanwhile agreed not to impose any corporate overheads on the CSI and accepted the opportunity cost of forgoing commercial consulting projects. The business case for doing so lies in the benefits the CSI brings to talent management. Our 2015 study in Organization Science found that consultants who were CSI participants indeed had a 33 percent lower departure rate compared to the company average, significant enough to offset at least a sizeable chunk of foregone profits.

Our subsequent research found that employees were lured to CSI by more than just the “warm glow” effect of having done a good deed. As shown in our 2018 paper in Strategic Management Journal  , many participants reported that they had also expected to benefit professionally. Because the CSI consulting projects involved tighter budgets and smaller teams, they presented an opportunity for consultants to leapfrog into leadership roles and potentially speed up their career advancement. This might explain why the programme often had a long waiting list.

Despite the seeming success of ConsultCo’s CSI, our latest research reveals that it would be wrong to say that it is everything it could be. Not all employees benefitted equally, as we found in our most recent paper in Administrative Science Quarterly. Looking into ConsultCo’s employment data from the years 2007-2012, we found that involvement in the CSI in fact could sometimes result in a lower likelihood of promotion. Further investigation showed that the “CSI promotion penalty” affected only men and not women (after accounting for other factors that might also drive promotions, such as past performance, tenure with the company and fraction of billable hours logged in the past).

To verify that the CSI-related gender disparity in promotions was not unique to ConsultCo, and to dig deeper into its causes, we carried out a vignette-based experimental study involving 893 businesspeople working for large firms (not including ConsultCo). Each subject was assigned to one of four experimental conditions in a “2×2” design and asked to make a promotion recommendation for a hypothetical employee. Depending on the condition, the employee was either male or female, and the employee could have chosen to participate in a CSI or not. All other variables were identical. The subjects were asked to give the candidate a score of 1 to 7 based on their evaluation of the candidate’s fit with the firm and their level of commitment.

We found that evaluators (i.e. the study subjects) were significantly less likely to recommend a promotion for male employees who had participated in the CSI. This finding was driven almost entirely by the male evaluators. In all other configurations – men assessing a female candidate, and women assessing male or female candidates – CSI participation made no difference to the hypothetical employee’s promotion prospects. Furthermore, male evaluators judged male CSI participants as having poorer fit with the firm, and hence being less suitable for promotion.

Gendered behavioural expectations and stereotypes seem to be at play here. Perhaps it is deemed appropriate for women – still seen by society as the more nurturing sex – but not for men to spend time and money for societal causes. Since our experiment suggests that male managers are much more susceptible to this stereotype than women, the gender bias in assessing employees on CSI participation will remain a problem as long as power structures at most companies favour men.

For a company like ConsultCo, the long-term danger to its CSI implied by this finding is that it could become a “pink ghetto” that not only reinforces gender stereotypes but also repels men who would otherwise be interested in participating. With at least half of the participant pool staying away, the entire CSI edifice could collapse.

There are several lessons here. While it is important to protect a CSI from the pressures of mainstream business just enough so that it can blossom into a viable business, we must also be wary about “siloed sustainability”. Ultimately, CSIs are most useful as a tool for embedding impact into the core of the business, as opposed to its periphery. For example, they should be leveraged as part of a broader sustainability strategy encompassing internal gender balance audits, environmental impact assessments and so on. Continuing a purpose-driven journey may require that impact programmes be frequently reassessed for their value-add as well as for any unintended consequences they create.

Companies may also want to institute processes to ensure that high-performing, purpose-driven employees do not only identify with a CSI but also remain engaged and integrated with the firm at large. For example, our employee retention study found that CSI participation’s effect on departure rates did not apply to consultants whose CSI projects lasted longer than six months or who were sent to far-off lands for extended stints. To become fully institutionalised, prosocial purpose should be both broadly accessible and reliably rewarding.

While creating shared value is a laudable goal, a transition of mainstream business in that direction has proven to be harder than we might have hoped. Attempts to implement “win-win” solutions invariably run into implementation challenges when the rubber hits the road, in the absence of an authentic sense of purpose in the firm’s DNA. Even though it is now fashionable for CEOs to talk about steering their companies towards becoming more purpose-driven, templates for making the transition are limited. Efforts of pioneering companies like ConsultCo, despite the potential pitfalls of their works in progress, are key to building these templates.

source: https://knowledge.insead.edu/responsibility/using-corporate-social-initiatives-to-build-a-purpose-driven-organisation-17681

Number of gig economy workers triples over past five years

One in seven regularly works in the gig economy, research has found.

Of working adults in England and Wales, 14.7% told researchers they worked for a gig economy platform at least once a week, compared with 11.8% who said the same in 2019 and 5.8% in 2016.

The workers were polled by the University of Hertfordshire and Britain Thinks for a TUC report, which warned that “spiralling” gig economy work would lead to more workers on low pay and in poorer working conditions.

“Our research shows that the gig economy is a substantial part of the UK’s workforce and I expect it to continue to grow. ‘Gig’ work can offer flexibility, but many workers also experience lower pay and poor working conditions,” said Professor Neil Spencer, head of the statistical services consulting unit at the University of Hertfordshire.

“Those classified as self-employed also have less rights than employees. It is vital that pay and conditions for gig workers are improved to protect those who rely on this work as a source of income.”

The survey of 2,201 workers, carried out in July 2021, also found that 22.6% of workers have worked for a “platform” at some point, up from 11.5% in 2016.

Examples of platform work include taxi driving, food delivery, software development, household repairs and cleaning.

The proportion of the working population carrying our gig economy work in delivery and driving roles has quadrupled over the past five years, rising to 8.9% in 2021 from 1.9% in 2016, the research found.

In 2021 11.9% of the working population carried our remote digital tasks, up from 4.9% in 2016; and 7.9% carried out household services booked through an app or website, up from 3.2% in 2016.

There has also been a notable shift in the gender balance among platform workers during this period. In 2016 men made up 48.6% of frequent platform workers, but by 2021 this had risen to 68.4%.

Platform workers are also most likely to be in the 25-44 age group.

The union body has called for gig workers to be granted greater trade union and individual rights including:

  • A New Zealand-style right of access to workplaces for unions, including a digital right of access, to enable them to talk to workers about what union membership can offer them
  • A new ‘worker’ status definition that covers all existing employees and workers and gives them a full range of legal rights, including holiday pay and sick pay
  • A ban on zero hours contracts by giving workers the right to a contract reflecting their normal hours of work and adequate notice of shifts.

TUC general secretary Frances O’Grady said: “Gig economy platforms are using new technologies to carry out the age-old practice of worker exploitation. Too often gig workers are denied their rights and are treated like disposable labour. The Supreme Court Uber judgment earlier this year was just the beginning. Unions won’t rest until pay and conditions have improved for gig workers.

“It’s time for change. Ministers must stop letting gig economy platforms off the hook. That means giving all gig workers trade union access, banning zero hours contracts and boosting workers’ rights across the board.”

source: https://www.personneltoday.com/hr/number-of-gig-economy-workers-triples-over-past-five-years/

Mastering the connection between strategy and culture

Ahmed Galal Ismail was impressed by the level of employee engagement in Majid al Futtaim Properties, the owner of the Mall of the Emirates—a huge shopping complex in Dubai that even boasts an indoor ski slope—when he started as CEO in late 2018. And he had big plans. Ismail wanted to build a company that delivered extraordinary customer experiences using its physical properties and digital platforms. He needed people who had the capabilities to anticipate customer expectations, rather than sit back and wait for customers to engage.

Working closely with the human capital director, he set about developing a “market shaper” culture—an organization perceived as driving the evolution of the sector—to stimulate more innovation and external orientation. At town halls with staff, he said he saw culture as a driver of transformation, and strengthening the corporate culture was one of his five Day One transformation initiatives, alongside reinforcing the core business, mastering efficiency, retuning the real estate development engine, and accelerating data-driven transformation.

The COVID-19 pandemic tested, but didn’t break, the strength of the connection Ismail was building between strategy and culture. It was straightforward to make the most urgent decisions, which were to preserve cash and to communicate more frequently with employees and stakeholders. Strategic decisions required more deliberation, given their complexity and materiality, and considering the uncertainty of the longer-term effects of the pandemic. Ismail also wanted to ensure that the steps he had taken to develop a culture that supported a mutually beneficial ecosystem with his tenants would survive. Freezing rents was a critical strategic decision that signaled this commitment. His efforts worked, and business at the mall has bounced back in 2021 to beat pre-pandemic levels.

A fresh imperative to act

Like Ismail, other leaders currently face making decisions about where they choose to play and how to win (their corporate strategy) as well as how to encourage their employees to make—and shape—that journey with them (their organizational culture) at a time of considerable change. Customers have moved further online, and competitors’ positions have shifted. Some, like the platforms, have strengthened; others have weakened or disappeared. At the same time, organizational cultures need to evolve to enable a new hybrid of virtual and physical working arrangements, and to recognize higher expectations of a better work–life balance.

In this context, it might be tempting to focus on developing strategy more than culture, or vice versa—the latter if you believe “culture eats strategy for breakfast,” a quote misattributed to Peter Drucker (it seems it was actually said by a hospital CEO). Focusing exclusively on either strategy or culture would be a mistake. A strategy that describes a “big picture” vision without specifying what it requires of the organization’s culture is destined to fail, especially if it doesn’t build from existing strengths. Likewise, evolving a culture without recourse to a clear, compelling strategic direction risks wasting effort, if not disruption; improving engagement, well-being, and productivity helps only if you’re serving the needs of your current and future customers in a way that others can’t or won’t.

The goal should be to master the connectivity between strategy and culture. They both should be anchored by capabilities—the “key activities in which you must invest disproportionately and perform distinctively to underpin your theory of competitive advantage,” according to author and CEO advisor Roger Martin. Prioritizing and investing in key capabilities must be supported by management systems and resources. In other words, the connection between strategy and culture has to be embedded in the management system and the allocation of resources, because together these support the decisions to invest in the critical few behaviors that disproportionately drive performance. Examples of capabilities: understanding customers (as in the case of Majid al Futtaim), partnering with suppliers, and building strong brands.

At the heart of this endeavor is an appreciation and incorporation of the perspectives, mindsets, and skill sets of others. Every organization faces a unique set of challenges and context. There are strategic moments in an organization’s journey that have a disproportionate impact on outcomes. Getting them right creates a multiplier effect on other activities as people learn new ways of working and increase their advocacy for the program of work. Terence Mauri, founder of Hack Future Lab, a network of technology industry leaders, calls these “imprintable” moments. They include:

• Strategy development. If you want your culture’s defining traits to be inclusivity, empowerment, and collaboration, the strategy process must reflect this desire. Opening up strategy development to participation, away from the typical top-down, closed approach, is a crucial act. It might involve running “dream sessions” in which employees envision the future of the company or contests designed to encourage participation and co-creation from customers, suppliers, and partners.

• Negotiations with important third parties (such as suppliers, partners, and agencies). If you want to encourage more curiosity as a cultural trait, negotiations should involve sufficient time spent understanding the interests of the parties involved and exploring a range of options for mutual gain.

• Recruitment of key talent. The messages imparted to recruits in the selection and onboarding process should reflect the strategic priorities (as communicated to the candidates), while the interviewers (and others involved) should demonstrate the desired traits and behaviors.

• Critical conversations with employees. There are important moments with employees—if they are new to the organization, underperforming, ambitious, or looking for a change in roles—in which it’s vital to discuss and clarify strategic priorities and expectations for performance and behavior.

source: https://www.strategy-business.com/article/Mastering-the-connection-between-strategy-and-culture