Episode #37: The CEO Wants Culture Change…Or Does He?

What to do when the boss doesn’t know they’re not committed

Many CEOs and senior executives talk a good game around culture change and transformation… it’s almost expected as the “done thing” for a senior leader.

Although many C-level leaders make the right noises, they don’t necessarily have the commitment to set the necessary standards, or generate the right level of momentum for culture change to ever take place, let alone be successful.

This week, we answer a great question from our listener, Nicola, who asked “Marty, how do you influence change so that senior leaders ‘walk the walk’ instead of just ‘talking the talk’, and then have that flow down the ranks?”

This episode helps you to recognise the signs of a boss who isn’t truly committed to change as much as they say, and gives some tips for navigating the environment so that you can still kick goals, no matter what.

THE CEO WANTS CULTURE CHANGE…OR DOES HE? WHAT TO DO WHEN THE BOSS DOESN’T KNOW THEY'RE NOT COMMITTED

Episode #37 Transcript

Welcome to the No Bullsh!t Leadership podcast. In a world where knowledge has become a commodity, this podcast is designed to give you something more; access to the experience of a successful CEO who has already walked the path. So join your host Martin Moore, who will unlock and bring to life your own leadership experiences, and accelerate your journey to leadership excellence.

Hey there, and welcome to Episode 37 of the No Bullshit Leadership Podcast. This week's episode, The CEO Wants Culture Change, or Does He? What to do when the boss doesn’t know they’re not committed.

Now many CEOs and senior executives talk a great game around culture change and transformation, and it's almost expected as the “done thing” for a senior leader to do. Although many C-level executives make the right noises, they don't necessarily have the commitment to set the necessary standards or generate the right level of momentum for culture change to ever take place, let alone be successful.

This week, we answer a great question from our listener Nicola, who asked, "Marty, how do you influence change so that leaders ‘walk the walk’ instead of just ‘talking the talk’, and then have that flow down through the ranks?" In other words, how do you deal with the situation where your boss isn't serious, but you are? And if he isn't serious, why would you bother? Because let's face it, sometimes it can only end in tears.

So we're going to start by talking about when the rhetoric and the reality diverge. What are the telltale signs that the perception is more important than the outcome? We'll move onto how to develop belief in the value of culture for the people around you. I'll give you some rules to test for whether or not the boss is really up for change. And then I'm going to give you some early warning signs so that you know when you're on a hiding to nothing. We'll finish off by recognising what a great leader would do under any circumstances when it comes to culture change. So let's get into it.

Pretty much every senior leader says they want to create a constructive, high-performance culture, and many leaders now measure this. But very few actually ever define clearly what this means, and we're going to talk about this later. But surprisingly few seem to be prepared to do what it takes to effect the necessary change to culture that would make a difference. Now it doesn't mean that these are bad people, or even that they're ineffective leaders, necessarily. But what it does say is they're only prepared to go so far in the quest for culture change. It's the elephant in the room that no one really talks about. They would rather point to the initiatives and the investments into culture that would make it look like, for all intents and purposes, their commitment is unequivocal. But it reminds me of the old Meatloaf song from the '90s, ‘I Would Do Anything For Love, But I Won't Do That’.

Many organisations have implicit rules in their underlying culture about what they're prepared to change and what they're not. Some organisations are more explicit than others when it comes to this. So for example, I know of organisations with very heavily unionised workforces that have an explicit truce: management won't change anything if the workforce turns up and doesn't cause too much disruption. These organisations do exist and hopefully you'll be giving them a wide berth, as they can be absolutely soul-destroying for good leaders who want to drive change. But assuming you aren't working for one of these now, there are still many interesting ways in when the rhetoric and the reality can diverge.

So maybe some of these symptoms sound familiar to you. Some leaders talk about improving safety culture but are unwilling to make changes to the leadership, to ensure this level of commitment. So they're unwilling to put respect before popularity, they don't want to rock the boat, and they certainly are completely unwilling to challenge, coach, confront the leaders who aren't doing their jobs. In other words, “I would do anything to make this organisation safer for our people, but I won't do that”.

Another classic symptom of only being prepared to go so far in the quest for culture change is spending money on big-change initiatives with external parties, so getting a bunch of experts to come in and help. Now this gives a CEO and an executive team plausible deniability. Look how committed we are. I'm spending real money on this initiative. In fact, I'm so serious that I even brought in these mega-experts. I can show anyone who cares to look that I'm doing everything I can to make culture change. Now unsurprisingly, these leaders don't accept that the accountability for change cannot be outsourced to another organisation. They don't understand, let alone ensure, that the change is driven through the organisation's leadership structure. This is a massive impediment to real change.

Now I want to drop a small confession in here for our several thousand listeners, so keep it to yourselves. At CS Energy, we run a multi-faceted culture change program. So we had a range of tools, measures, leadership-development initiatives that were designed to drive a better culture and a high-performance culture. And for the most part, these gained excellent traction to deliver the improved culture that led to increased performance. However, some pockets remained untouched because the frontline leaders weren't up for doing the hard work of change, and their managers were too slow to remove and replace them, if at all.

But at one point, we ran a major change initiative designed to improve safety culture right through to the frontline workers. And when this happened, a lot of leaders just breathed a sigh of relief and mentally outsourced the work of change to the external group who brought the expertise into the company. So I was quite shocked when I realised a little bit down the track, that I had to reemphasise the importance of ownership and accountability for change being with us, not with these external experts. And we probably lost, in truth, six months' of traction, while I identified, and then responded to this issue.

But what if I hadn't been super-driven and diligent on the people's side of this change? What if, instead, I just spent my time looking at reports in my air-conditioned office? I wouldn't have picked up on this and we would've lost more than than year in traction. We would've been going backwards at a rate of knots. So some senior leaders were actually saying, "I would spend lots of money for an improved culture, but I won't take accountability for driving the change through my leadership structure, because I certainly won't do that."

While we're talking about structure, some leaders try to use mechanical or superficial means, like a restructure, as a proxy for cultural change. So these leaders are happy to do the things that relatively non-controversial and can be implemented without addressing the real underlying causal factors of a poor culture. What they're saying is, "I will spend time, energy, and money restructuring in the guise of culture change, but I won't face into the difficult people issues because I won't do that."

And just a final example, some leaders like to leave change in the hands of a change management specialist. So they allow leaders in the line to abrogate their responsibilities to those with the word change somewhere in their title. Like our previous example of bringing in an external company with structured training programmes, some leaders are happy to hire change management experts and assign them to different parts of the business to deal with the change. What they're saying is, "I will invest in change specialists, but I won't place the accountability for driving change with the right leaders, because I won't do that."

Now all of this can be summed up by saying that a huge percentage of leaders think, "I'd really like to improve the culture. I know I should improve the culture. I'm prepared to do a bunch of stuff that I hope will improve the culture. But I have limits, whether they're implicit or explicit, about what I'm actually prepared to do to make change." These things, unfortunately, are more often these not what makes the difference between success and failure.

So let's talk about how you develop belief in the value of culture and why change is good. Because sometimes even directors sitting on a board think that culture is a crock of shit. They won't say as much, but you can read between the lines in what they don't say. Now boards are supposed to play a big role in culture, but I can't see this for the life of me. Certainly not in Australia. If any of our international listeners can give me a different perspective, please drop me an email at marty@yourceomentor.com.

You don't need to be a director, CEO, or even a C-level executive to improve culture. You start with what you can control and what you can influence. Now if you're in a position where you're not in full control, that is, you're not the CEO or senior executive accountable for culture change, what can you do to make a difference? Because it's hard enough to make change from the top, let alone from below. If you have to drag those above you, kicking and screaming, to first of all, allow you to do the hard yards, because let's face it, it's going to challenge them if they're not doing it, and it'll probably create a hot-spot of activity that can draw the crabs and give them issues they don't want to have to deal with. And secondly, you got to move them towards a more committed set of culture change actions. So how would you approach it? Well here's four rules for how you might approach this with leaders who aren't true believers.

Rule number one. If you're going to spend your time, energy, and resources on this, you'd better be able to clearly articulate the benefits to the non-believers. Have it clear in your own head why you're doing it, and be able to articulate it strongly to anyone who wants to know, above, beside, or below you. Culture change is not about altruism. It's about performance. Now it just so happens that there's plenty of serendipity to culture change, but be clear on what the benefits are to the organisation. Otherwise, you won't sway the woman in the corner office. If their lips are mouthing the words culture change, that should at least get you into the conversation, though, so that's a bonus.

Rule number two, be super clear on why it's good for all involved. So create a clear value proposition for every one of your major stakeholders, so that you can articulate the why from their perspective. So for the organisation, we talk about performance value delivery and lowering of risk and so forth. But for individuals who work for the organisation, we talk about job satisfaction, impact, happiness, future career prospects. For customers, we can talk about customer satisfaction and value delivery. But once you've done this for all your stakeholder groups, tell that story widely. Much of this is about selling the benefits of change. People won't buy into the execution until they believe in the authenticity of the goals. So you're asking people to step well outside their comfort zone, so they need have a compelling case that helps them to believe that life is better on the other side of this change.

Rule number three, be very open about the fact that most culture change initiatives fail. But most importantly, talk about why. Most often, leaders aren't prepared to do what it takes. It's that simple. And this is why the value isn't returned and it becomes a self-fulfilling prophecy. Culture is then ignored as a major driver of value, and you quite often hear senior leaders say, "Oh, we tried that and it didn't work." Well this is your compelling selling point for those above you. We know that most culture change initiatives fail. We know that the reason is that most leaders won't do what it takes to do to make the changes from the academic models actually stick. But we can be different, if we're genuinely serious about this. If not, we may as well save the money, energy, and angst, and not pretend we're doing enough to drive the change. This is no bullshit leadership.

Rule number four, find an exemplar as early as possible. So in a large organisation, there are hundreds of different sub-cultures living in different teams. Point this out and use it to your advantage. So identify the team in your organisation that is universally regarded as having the best leadership and culture, and of course, inevitably, there'll be a correlation with performance that comes from this. Simply ask your executive leader or CEO, "What would it be like if every team behaved and performed like that?" or, "How good would it be if we could multiply the number of high-performing teams in our organisation?" This is going to give the entrée to the truth.

Let's move on to how you can test the waters to see if the boss is up for it. So now that you're prepared to approach the issue using the rules and tools above, here's a few suggestions for dealing with the boss who, as they say in Texas, has a big hat but no cattle. So in other words, all talk, no walk. If your boss is stuck in the ‘grand change initiative’ mode, with big names, big training programmes, and big dollars, bring her back to the fact that this is necessary, but not sufficient. Here's why we are unlikely to succeed using solely that approach. And then be able to articulate what we should do differently.

If your boss is relying solely on a trusted change management methodology, like Kotter's Eight Steps or ADKAR, talk about why this is necessary, but not sufficient. And remember that process people love process more than results. If your boss believes their own bullshit, and lacks inquiry at the grassroots level of the organisation, then this is Emperor's New Clothes Syndrome. You need to help them by pointing out that the best information about rate of change comes from the people on the frontline.

You, and those above you, should be with the people often enough to converse with the frontline workers and ask innocuous questions, "Is anything different? What's your leader doing differently since we started this change program? Has your working life become any easier? What's not changing that you think should change?" And of course you need to be asking questions of lower level leaders right through the line: "So what are you doing to make this change stick? What evidence do you have of progress in your team? What's holding you back? Are you getting support from the leadership above you? Do you think the CEO and executives are serious about doing what it takes to make this a better organisation by improving the culture?"

If you have a leader who likes to communicate the aspiration and not the reality, then it's up to you to bring to life the gaps. The best disinfectant is sunlight. So put it in the open and make it impossible to avoid or gloss over. Now this can be a little tricky in terms of the amount of subtlety required, because you don't want the boss to feel like an idiot. So do it in the appropriate forum, in a one-on-one situation.

You may have a leader who is very methodical and process-driven, who likes to reduce culture change to a spreadsheet, training initiative, or project plan. Make sure that this leader knows that you can't train an organisation to success. It's the least effective method of learning and change. Point out that you're measuring the wrong things. For example, measuring the number of people trained tells you less than nothing about the culture. It only tells you the cost of your ineptitude. This is where you need to bring them back to the value focus every time. What will be different in terms of value delivered at the end of all of this? And my killer question for leaders below me, when something like this, and it's the same if you pose it to someone above you. Let's say all of this goes swimmingly well and you were to execute the plans absolutely perfectly. Does this actually solve our problem? Does it give us a high performance culture where we have improved safety, productivity, and quality?

How would you know if you were fighting a losing battle, or as I like to say, if you're on a hiding to nothing. Despite all of the available tools and approaches, sometimes you need to recognise that the only course of action for you is to raise the white flag and succumb to the organisational inertia created by the CEO and board. In general, no one below the CEO will go out on a limb if the CEO won't. And if the CEO won't deal with non-performers, everyone below them gets a free kick. The leader sets the tone, the pace, and the standard, so other leaders take their cues from this.

For successful change, all leaders through all levels have to be committed. Now if you're a trusted advisor to the CEO, you can talk openly about the things that are working and the things that aren't. So for example, you can be the CEO's eyes and ears to the reality of the progress around the culture change. You can also talk about which leaders are really serious about the change and which are paying lip-service only. And without painting the boss into a corner, track change progress with leader capability and willingness to implement change. You'll see some interesting correlations. But you'll work out pretty quickly if the CEO is willing to do the hard work, with your support of course, to change tack and make a real difference. If not, at least you then know where you stand, and then, you can make some choices.

So what would a great leader do? As long as you're in a role, you accept your professional obligations as a leader. What does this mean? You do the very best with the resources you've got every single day. You lead by example for everyone around you, above, below, and beside. You always do the right thing, no matter what the personal impact. You maintain your high professional standards, even if they're higher than the people above you. And you keep challenging yourself and your people to improve, stretch, and grow.

If the prevailing culture and leadership doesn't support this for the totality of the organisation, then what do you do? Well you focus on what you can control. The degree of difficulty increases substantially, but for your people, you still get to set the tone, the pace, and the standard. So you go about the business of changing what you can. You set high standards, even if they exceed the rest of the organisation's standards. This will have a couple of really interesting impacts. It will attract the right people to your team, and the ones who don't want to be part of it will generally self-select. This fact alone makes it so worthwhile to do. So then you get after the job of building the best culture you possibly can.

In the end, if your current boss or organisation doesn't recognise and appreciate what you've done, then at least you know it has made you a more capable, experienced, and resilient leader, who has a much higher likelihood of future career success.

Alright, so that brings us to the end of Episode 37. Thanks so much for joining us, and remember, at Your CEO Mentor, our purpose is to improve the quality of leaders globally. So if you're enjoying the podcast, please take the time to give it a rating on your favourite podcast app, and write a quick review, because this helps us reach even more leaders. I look forward to next week's episode, Communicating for Impact. 

Until then I know you'll take every opportunity you can to be a No Bullsh!t leader.

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