NINE

Aligning Culture

Alignment provides predictability. Predictability provides safety. Safety provides confidence. Confidence provides performance.

I'll never forget, when at the age of nine, my father took me to New York's I Yankee Stadium to see my first baseball game. As we walked through the tunnel into the bright light afternoon sun, I was instantly mesmerized by the vastness of the stands, the brilliance of the green lawn across the field, the famous white veneer from which Yankee banners hung, and the proudly displayed flags, representing the team's World Championships.

This is a place of heroes. I could feel the energy that electrified the stadium an hour before the game even started. I was drawn into and absorbed by Yankee culture. When the players burst onto the field in the famous Yankee pinstripes with the swagger of winners, cheering fans rose to their feet, and I experienced an emotion I will never forget.

As a management and leadership consultant, I pay a great deal of attention to what I observe, how I feel, and what I infer when first walking into a building or room. I am especially sensitive to the environment and the energy of the employees and how they interact with one another. I listen intently to how they speak to one another. No matter the venue, a dynamic is always present that consciously or unconsciously contributes to how we feel about our experience. It is always the human quality that affects us.

This happened when I first walked through the processing and packing plant of Blue Diamond Almonds, a growers-owned cooperative of over 3,000 California almond farmers. From the moment I interacted with the woman in the security booth and stepped onto the company's grounds, I experienced a sense of casualness, calm, wellbeing, and ease, even though a great deal of activity was going on around me. There's an energy that permeates a company's culture and contributes to how everyone—employee or visitor feels.

Over the last four to five decades, Blue Diamond's brand name has become increasingly familiar worldwide. The company distributes millions of pounds of almonds to over 95 countries, and it continues to grow. Globally, almonds are the number one nut, with consumption growing steadily at 10 percent per year. Blue Diamond is the world's largest processor and marketer of almonds, and California accounts for 80 percent of the world's production. Like any great company, Blue Diamond owes it success to its aligned culture. Often we discover that the origin and roots of a culture can be found in the values and beliefs of the founders—in this case, 230 California almond farmers in 1909, which remain its guiding principles. This is certainly true of Blue Diamond. The founders’ commitment to partnership, innovation, integrity, and quality remain the guiding forces of its current culture. Today, its 3,000 grower-owners are a diverse group who operate orchards ranging from 10 to thousands of acres. Their goal is for each to personally benefit from their membership and trust in the integrity and commitment of those responsible for leading the company. This common thread is evident in the company's culture and its employees’ commitment to the member farmers.

In the 1920s, scientists discovered that almonds were an excellent source of protein and minerals. Almond sales exploded, and Blue Diamond's brand intention of physical wellbeing came into being. During World War II, chocolate bars with almonds were given to troops to improve nutrition. This further elevated almonds’ nutritional status, and their popularity grew. The natural foods explosion of recent decades paved the way for Blue Diamond's very successful marketing, which targets the health-conscious market. The trend is expected to continue. By leveraging its brand intention of physical wellbeing with its capability for product innovation worldwide, Blue Diamond has successfully expanded the brand's sphere of influence to include the rapidly growing markets of India, China, and Eastern Europe.

Bruce Lish's relationship to Blue Diamond is representative of it's employee experiences. He began working there 42 years ago as a part-timer while he pursued a career as a professional baseball player. He stayed with the company for the next four decades working in a variety of positions. He readily accepted opportunities and new roles, even when he had minimal knowledge, often cultivating his competencies and skills as the job required them. Bruce personally developed and grew with the company, which is not unusual at Blue Diamond, where personal development and ownership are continuously reinforced. Eventually, he became General Manager of Operations and a member of the executive team.

As with other employees I talked to, Bruce described the company's culture as one of family. It is an organization comprised of long-term employees who develop lasting relationships with one another. They see themselves as members of a big team in which each individual displays a pride of ownership and defines his or her own path to improvement and development. Employees are given the opportunity to pursue personal satisfaction, enrichment, and empowerment. Employees have daily control over workflow, a responsibility that results in an ongoing effort to identify improvements and work in collaboration with team members to track performance and create change. Like Bruce, employees are given the opportunity to learn and develop the competencies and skills needed to take on new roles and responsibilities and to grow through them. That expertise and skill results in the continuous innovation—creating new products and offerings, opening new markets, and collaborating with its partners—and growth the company enjoys.

Blue Diamond Almonds culture preference is authenticity, and it successfully integrates traits of participation and expertise to innovate and deliver quality. The values that guide its leadership and employees are commitment and integrity. The company's culture is powerfully aligned to its vision of delivering the benefits of almonds to the world, which has been at the core of its brand for over a century.

Creating and leading an aligned culture is one of the more demanding tests of leadership. It applies to CEOs, business owners, and anyone in a leadership role. Successful alignment begins with a framework, knowing what the keys of culture are, and knowing how to apply them. This requires a keen awareness about what motivates individual and group behavior and how these forces influence how things get done.

ITS ALWAYS ABOUT PEOPLE

Cultures are groups of people. A company can have many moving parts that function to produce a product or service and succeed in winning the customer. There are many choices about what market strategies to pursue or what internal changes are needed to improve performance. The twelve culture keys are all about what motivates people and aligns them to work together. It always comes back to one thing: It's always about people.

The three human motivations: (1) the level of attention we receive; (2) the level of competency we achieve; and (3) the level of acceptance we attain are the keys to understanding the patterns and norms of behavior within a culture, how a culture defines success, and what constitutes acceptable and unacceptable behavior. They are the drivers to how values and beliefs come about and how well people align to them. They allow leaders to strategically use the culture keys to create alignment and a sense of predictability that supports healthy patterns of individual and group behavior.

Cultures result from the interaction of people in groups, from how they influence one another to get their individual and group needs met. We all seek fulfillment and, as a result, all three sources of motivation are present in us individually and in the culture of the groups we form.

As individuals, we have distinct personalities—behavioral characteristics that reflect our psychological make-up and our experiences and result in our uniqueness. Our own mix of traits and qualities guide our personae and the behaviors we use to influence others; they are manifested through the attitudes and dispositions we show to the world.

In working with others and fitting into a culture, the traits we demonstrate, our likes and dislikes, the type of team player we are, how we compete, how willing we are to collaborate, our willingness to engage in conflict, our eagerness to hear what others have to say, our impatience, our insecurities and fears, what makes us happy, what angers us, and what brings us joy and contentment, how we express and communicate our values and beliefs, how we judge what is good and bad, right and wrong, and how we interpret what is moral and immoral all come into play.

Through all of our actions—the choices we make and everything we do and say—we convey the preferences of our personalities and express our wants, needs, and desires. While every person is affected by each source of motivation, everyone shows a preference, to some degree, for one of them. This also applies to how one leads. As we'll explore in Chapter Ten, a leader's personal preference will generally show in his or her leadership style and strategic inclinations. Cultures are groups of people motivated by their needs. We engage in collective action with others to achieve what we individually want and need and to contribute to a shared outcome. The three human needs are attention, competency, and acceptance. In the context of culture, these are satisfied through the behaviors associated with the level of participation, the use of expertise, and the authenticity with which people communicate with one another. These provide observable and measurable means through which we can assess how a company or team goes about getting things done and how people interact with one another.

THE THREE CULTURE PREFERENCES

In cultures, the need for attention is met through participation. This is communicated through engagement in collaborative and inclusive approaches and group processes, the level of social interaction, and how individuals are included in the various processes and actions that are undertaken.

The need for competency is met through expertise, which is communicated by how personal achievement is rewarded, how hierarchy relates to competency and rank, and the amount of control and authority granted to individuals based on their skills, knowledge, and competency.

The need for acceptance is met through authenticity, which is demonstrated through openness and honesty and the ability of members to freely express what they think, see, and feel.

Just as every person will show a level of preference for one of the three human motivations, the same is true of cultures, where it is the result of how people influence one another and how they work with one another to get things done. Every culture, regardless of size, displays norms and patterns of behavior that reflect its preference; the more clearly defined and predictable that preference is, the more likely the members are to perform at high levels.

This is an important aspect of how one intentionally and successfully leads an aligned culture. By constantly and consistently defining and aligning how things are done, the preferences of a culture provide a sense of safety to its members, tell its members what is acceptable and unacceptable, and explain how to take part in and contribute to success. Aligned cultures offer consistency and predictability to groups in which people feel safe and believe they can act without fear. In turn, this confidence gives people the courage to take risks, which allows them to engage their imaginations and express their creativity. Creativity is the engine of innovation, and aligned cultures are innovative cultures. The people in them love to perform, contribute to the vision and mission of a company, and be a part of its shared success.

Some practical aspects of alignment are worth investigating here.

The first is that every culture is unique. It is important to observe and measure those traits and characteristics that make it so and, when they serve the company well, to integrate them into the culture's intentional alignment. Although you may be tempted to believe that absolute alignment of the culture keys is necessary, that is not the case. Aspects and practices that reflect the traits of the other two preferences can be used in service to a company's culture to leverage a unique quality without which the company would not perform the same way.

That said, the clarity of alignment to one culture preference is an important ingredient of success. Companies and teams that lack clarity or try to balance all three preferences—participation, expertise, and authenticity—are generally grappling with performance issues. In most cases, the challenges and performance issues are predictable. The lack of clarity, opposing viewpoints, and differing perspectives, as well as the coalitions that develop in support of them, typically result in a lack of cooperation and the failures of poor teamwork. Often, the resulting “us versus them” mentality finds its way to the customer.

A better approach is to identify the qualities typically associated with the other two cultural preferences and strategically use them in service of the preference with which your company is aligned. The key to success is to define and articulate the reasoning behind the strategy and clearly define the intended outcomes and influence. A good way to make such decisions is to ask, “What is in the best interest of the business?” and to clearly and consistently communicate it.

It's relatively easy to create confusion by not being clear. In my experience, companies that measure fairly equally across the three preferences have a host of issues and dysfunctional patterns of behavior and interactions. In most cases, this approach results in the formation of coalitions, each arguing for its own way of doing things. Much like a multi-personality disorder, it's not a good idea to have a multiculture disorder. It confuses everyone, including your customer.

When one part of the company has a culture preference that is not aligned with the rest of the company, it is known as a subculture. The two are often at odds. This can lead to many of the same issues as occur when a company's culture preference is ill defined, including the ongoing conflicts the culture clash fuels. Usually, when a subculture exists and causes severe problems, the best solution is to change it, although this is difficult without changing the people. The path to culture change is almost always turnover, which often includes, or begins with, the leader.

Exceptions occur when it is in the best interest of the business to maintain a subculture. There are three ways to integrate a subculture successfully. The first is for the leader or team of leaders to clearly articulate the business reasons and strategy behind having a subculture and to consistently communicate how it is in service to the company as a whole. The second is that the leaders themselves have an ongoing conversation to assure that they are all continuously in alignment on their shared strategy. This is vital. If the leaders are not aligned and do not communicate in an aligned fashion, their respective team members will follow their lead. When the leaders of different teams and groups are in conflict, their team members will be too. From individual workgroups to large business units and divisions, when the leaders are not aligned, the “us against them” attitudes they display influence the people they lead. In some instances, the legacies of leaders who are in ongoing dysfunctional conflict with one another have a long-lasting effect on the companies they led. Companies risk failure, and do fail, because of such misalignment.

The third way is an ongoing effort by leaders to coach the people they lead, including sharing the strategy and plan for the subculture, the goals and outcomes the integration is to achieve, how the approaches to work and how getting things done may differ, and how to integrate the differences to create successful working relationships among the groups. There are times when leaders of companies collaborate and work together as a team, yet the groups for which they are responsible do not. Typically, the cause is that the leaders are not spending enough time communicating and coaching their team members on how to achieve success. When it comes to successfully integrating a subculture into the broader, larger culture, leaders cannot overcommunicate or coach enough.

The knowledge and skills required to effectively manage conflict and disagreements must always be a part of coaching. As differing cultures will have their own approaches and norms for managing conflict, a focus on coaching people about the nuances and approaches to creating success between cultures is vital. When it comes to coaching employees about the integration and alignment of culture, communication is often the skill leaders should focus on. This is often true of any coaching relationship.

Before problems arise, leaders should always start to develop the skills necessary to coach others and to assure that others receive the same knowledge and skills. All too often, we wait for trial and error to do its work. That's not good leadership.

THROWING SPAGHETTI

A great deal of power comes with knowing how a culture works and understanding its unique characteristics. One way this power is manifested is predictability. Sometimes strategies that initially look good are, right from the outset, headed for failure; great ideas, in a relatively short time, become bad ones; and, despite good intentions, a change results in more grief, conflict, and disruption than value.

Today, we all have access to a large quantity of information that encourages us to be innovative and continuously make the changes that result in higher levels of performance and success. Ideas flow like water and can be as intoxicating as a fine wine. We are exposed to a multitude of management and leadership thinking through books, blogs, videos, and other media. Still, it's difficult to know what will work and what won't. Some ideas immediately look great and inviting—after all, another company built its success on them. As a result we set out to implement the concept only to eventually conclude that it doesn't work. It's like throwing dry spaghetti against the wall and expecting it to stick.

In my experience, the most frequent cause of failure in implementing a new strategy or change is its misalignment to the culture. It doesn't fit. For example, one company with a hierarchal structure and a top-down leadership approach decided to engage its people in increased collaboration after several of the company's leaders attended a conference on self-directed teams. They thought if they could get everyone working in self-directed teams, it would force employees to communicate more and help break down the company's functional silos.

They began implementing the change by putting frontline employees into self-directed work teams and assigning middle managers to cross-functional leadership teams. Over the course of eight months, the company sent line staff through team training aimed at developing the collaboration and problem-solving skills required. They also sent managers to a two-day workshop on team leadership skills. A year later, they realized that despite reorganizing employees into designated teams and their investment in training, the behavior of leaders and employees had not changed. Decisions were still top down and midlevel leaders were not collaborating any more than before with one another or their employees.

Just because you realign relationships and workgroups doesn't mean that the behaviors of those involved will change. We can question whether two days of training will convince managers to act differently, yet the real reason the strategy failed was that it did not fit the culture. Self-directed and cross-functional teaming are great ideas. Although they work well in some companies, they will not work in every culture. The source of an idea is also important. When you come across an idea, theory, or approach to how to best run, lead, or work in a company, it is important to recognize the preferences of the person or people providing it. Whether it is a writer, consultant, coach or other provider, each has preferences and sets of experiences that shape their view of the world and how it works. Those preferences will show themselves in the approaches they advocate. That doesn't make them right or wrong. They just don't fit.

Not every idea or approach will contribute to the alignment of your company. Just because the Toyota Way works in some companies doesn't mean it will work in others. While Six Sigma works well in some cultures, it may be doomed from the start in another (think Starbucks). Too often, when the approach doesn't fit the culture not only will the initiative or strategy fail, it can result in disruption, negatively impact the performance, misalign a culture, and damage the trust in leadership. It can also have a significant negative influence on the customer. Furthermore, it often takes a long time to recover.

When an idea, strategy, or an approach to teaming aligns with a culture, it will generally succeed. When it doesn't, it fails. Replicating or chasing someone else's idea of a best practice will not always bring success. It's much more about having a healthy, aligned company.

It always comes back to asking the key questions. Is the strategy in alignment with or will it further the company's alignment? Does the strategy and its implementation align to your culture? Will the practice or strategy support and further align the company's performance? Will it make us better as a company?

REMEMBER WHO YOU ARE

I'd like to again emphasize that every culture is unique. Therefore, each company has to contend with its own alignments and misalignments. What is right and wrong comes back to what works and doesn't work for each individual company or team. The three culture preferences are a means through which to assess, strategize, and take the actions that best serves your company's or team's culture and result in the highest level of success.

Lastly, I encourage you to always be connected to your own individual preferences; they provide a clarifying lens through which you'll be able to find your personal alignments and misalignments, better understand why you enjoy working in one situation over another, and gain insights into your personal leadership preferences. Understanding the three preferences allows you to see how they connect to your values and beliefs.

THE PARTICIPATION PREFERENCE

A small, highly specialized company that builds intricate prototype machinery and instruments illustrates a participation culture. Its typical customers include the designers and makers of medical devices, diagnostics instruments, fluid control devices, and other complicated and specialty designed machinery. Often, the company manufactures small batches of very particular, highly technical tools. During its twenty–year history, the company's founder and president, John, built deeply trusted relationships with his clients and carved a strong niche in its regional market. Early on, as the result of these relationships, John was introduced to several larger multinational companies with regional operations, which resulted in ongoing relationships from which the company continues to benefit.

The company's employees are treated as family, and turnover is rare. When he first started the company, John implemented a profit-sharing system that is still in use. Several longer term employees have small percentages of ownership. John includes the part owners as well as other team leaders in most decisions. When one of teams does an exemplary job, the entire company celebrates. The company holds quarterly meetings and twice a year, for the holiday season and in the summer, employees and their families come together for a special event.

Employees are organized into teams, many of which have had the same membership for years. The teams are cross-functional and have direct relationships with customers. Every morning, at 8:10, all employees gather in the lunchroom for the company-wide morning update. John doesn't do much except show up; the teams discuss their projects, how they're coming along, and what new projects are on the horizon. Because the teams share equipment and workspaces, the coordination process the employees engage in is important in successfully meeting timelines. With a focus on customer deliverables, decisions regarding resource allocation and scheduling are made collaboratively and are usually taken care of at the morning update. Members of the accounting team, purchasing, logistics, and human resources are all present at the meeting. The time spent together every morning allows members of teams, when needed, to step in to help another team.

Performance is very stringently measured at the company; team and individual quality and accuracy are constantly scrutinized. Team members take a great deal of pride in assuring that everyone's role is well executed. Employees are trained across all the technical areas, and team members are responsible for mentoring and teaching one another. An ongoing reporting takes place at the morning update. If an issue arises, the expectation is that people will come together to solve the problem quickly and effectively. John likes to point out that working at the company isn't for everyone because of the high demands team members put on each other's performance and the level of responsibility every employee has to keep commitments to fellow team members. The one reason John has had to fire employees was their failure to keep their promises, thereby letting down their fellow team members. With rare exception, these firings were supported by the team the employee was a member of.

Often, when customers come to visit, the entire team spends social time, including dinner, with them. There is a small recreational area with picnic tables, a barbeque pit, a volleyball court, and a bocce court dedicated to connecting employees with one another. When the weather is good, most employees enjoy lunches together and engage each other socially.

Regardless of what a company does and what industry it competes in, it will have culture traits that we're familiar with because they are common to many companies. At the same time, these traits make every company's culture unique and define its cultural preference.

John's company is a good example of a culture with a participation preference. Such cultures often refer to themselves as family-like and pride themselves on inclusivity. Motivation comes from a high level of involvement. People expect to be receive attention and be heard, which results in mutual respect.

Using the twelve culture keys, the following is a typical profile of a participation culture.

Power and Influence is gained through participation and involvement. Those most aligned with the culture are typically seen as amiable, friendly, and outgoing, and a great deal of influence comes from these traits, as well as good listening skills. Someone who collaborates well with others will align well to this preference.

Planning and goal setting is accomplished through involvement and sharing. Large group processes that involve everyone are most likely to result in success. Methods for planning and effectively managing change include brainstorming, shared planning approaches, and processes that broadly include and engage employees. The concept of selecting individual change champions is misaligned, and those who desire to separate from the team are generally not going to succeed. In a participation culture, people who are asked to be change champions will go to the group and collaborate and build team consensus. Measurement of performance against goals is shared openly and inclusively.

Problem solving is a shared and team-work driven process that offers the opportunity for engagement, participation, and involvement. When someone has an issue that needs to be resolved or a challenge to be confronted, it is best served by getting the team together. When a mistake is made, in most cases the team will fix it together. When dealing with a challenge that threatens one of its members, “we're all in this together” is a common response. It gives them an opportunity to engage socially, participate in the process, and make a contribution.

In a participation culture, decision making is also a shared and group-driven process. In John's company, a high degree of involvement and information sharing is required; commitment to a decision is lessened when people feel uninformed or left out of the loop. Often, leaders in participation cultures look to the team to make decisions or, when the leader must make the decision or take action, he or she will typically ask for the team's input.

Conflict generally results in collaborative and shared problem solving. Members will work toward discovering what the person or group wants and accommodate it. Keeping the peace is important. Clashes occur when someone is upset about not being included; angry over not being heard; feeling ignored; not being invited to participate and feel a part of something; and the perception that someone is putting self-interest ahead of the team's interest and performance.

Among the approaches to incentive and reward, those that best align to and reinforce group and team contribution are shared reward, equity, team recognition, and social celebrations. Often, social celebrations have a greater affect than shared monetary rewards. A high degree of value is placed on recognition that an individual is a member of, or is identified with, a team that performs well. For this reason, employee-owned companies with shared reward systems perform well when aligned with the participation preference.

When it comes to hiring, group involvement in the interview and decision making processes are keys to success. One aspect of hiring well, and often the primary concern of the participation culture, is finding the person who offers the best interpersonal fit with the other members of the team. Group interviews often provide the opportunity for a hiring team to experience the candidate together.

Role definition in the participation culture usually centers on being a team player and the ability to work well with teammates. Getting along is important, as is the ability to work cross-functionally. When it comes to development, a great deal of emphasis is placed on knowing what other members of the team do, what the required skills are, and concern for the other team members. When a team member goes off for training, that person is generally expected to share what is learned.

When it comes to customer interface, John's company is a great example. Cross-functional teams work directly with the customers they serve and spend time with them. Through a natural extension of the culture, the customer is often the center of focus or considered “one of us.” Emphasis is placed on relationships and knowing the customer well. This sense of bonding and connection creates a foundation for long-term trusted relationships. The overriding qualities of the customer interface are connection, community, and attention.

Teamwork is all about involvement and looking out for one another. When groups in a participation culture are performing at their best, communication is informal and free flowing. Much as in John's company, this applies to how team members work with one another, as well as how teams across the company communicate and work with one another. Self-directed workgroups and teams can also succeed in a participation culture.

The structure of participation-preference cultures consist of relatively flat hierarchies comprised of cross-functional teams. Team leaders are assigned. Shared leadership can also work well, and while teams have direct supervision, it may appear that leaders are responsible for multiple teams. One aspect of cultures and their structures that is often overlooked is the environment in which they work. To support interaction and informal communication, participation cultures are generally partial to open workspaces and environments. In John's company, the lunchroom is used as an open space, inviting dialogue and information sharing. The outdoor picnic and recreation area reinforces group identity and employee cohesiveness. The company culture communicates “we.”

The twelfth culture key is aligned values. How words are defined offers insight. Some words that are consistently used to define the values of a participation-preference culture include teamwork, family, listening, community, respect for the individual, equality, cooperation, fairness, collaboration, diversity, and inclusive.

Harley-Davidson has a set of values that demonstrate the alignment of its culture's values to the values it communicates to its customers. “We ride with our customers” is the statement that defines the company's customer-centric approach, which is based on deep emotional connections. In aligning its culture, the company puts a great degree of value on its team-based collaborative approach and the inclusivity of its diverse workforce. The company's stated values include telling the truth; keeping our promises; respecting the individual; encouraging intellectual curiosity; and, being fair. The company's participation preference is obvious.

Disney prides itself on its teamwork and inclusive culture, particularly in its theme park business. That isn't lost on the over 70 million visitors it attracts every year. When a company is aligned, it creates a strong force of attraction.

THE EXPERTISE PREFERENCE

The management term “up or out,” supposedly originates from the idea that a company should hire the most talented people it can find, give them an opportunity to learn and grow, prove themselves, and eventually become key assets of the company. Sometimes, the reward is becoming an owner or shareholder in the company. For example, in professional service companies—accounting, engineering and law, for example—one hires the best and offers them the prospect, within a designated timeline, to become a partner of the firm. If the person fails to perform at the required level, they are asked to leave. The idea is pretty straightforward. This exemplifies the expertise preference culture.

The motivation is for the employee to become an expert, building his or her capabilities, and becoming as competent as possible. Power and influence is derived by achieving status and ranking at the top of one's peer group. The better one performs, the more other group members are challenged and given the opportunity to advance.

Imagine a company with over 12,000 employees, all vying for the chance to consistently be among the best at their craft. Based on their competency and specialty areas, employees are assigned to projects that are run by well-qualified project managers who possess a clear set of capabilities and the know-how that best aligns to customer needs. The company prides itself on being able to address the customer's most challenging problems. The greater the problem, the more the company will show its determination and passion to perform. As a result, it attracts some of the brightest people. It is known for leveraging their intellect and thinking, constantly and relentlessly challenging them to be their best, to achieve as much as they can.

In alignment to customer motivation, the company sees itself as a preeminent institution. It prides itself on building the capabilities of its people at every level. Teams are built by assembling a collection of the best talent available. Those who have proven themselves and earned their place in the company are trusted with ranking other employees and assigning them to wherever they will have the best opportunity for learning and development. The emphasis is on constantly challenging and growing people to be the best they can be. The expression that is used to describe the company's culture is “grow or go.”

The company I'm describing is McKinsey and Company, a global management consulting firm whose culture displays a clear preference for expertise. Its reputation is built on the depth of its industry and functional competency. It is a model for optimization of determination, influence, and the application of knowledge. It is also very well aligned.

The underlying traits and characteristics that makes it so extraordinary are the same traits that make Samsung, Wal-Mart, Apple, IKEA, and Toyota great companies—a preference for expertise.

In expertise cultures, power and influence are gained through the ability of the individual to demonstrate competencies and skills. Employees advance based on how well they compare with their peers—their rankings in the hierarchy. With advancement, comes a position and role of authority.

In less formal expertise cultures, it's not always about the authority that's granted through position or title nor is there as much dependence on hierarchy. It is more subtle and more about one's aptitude and abilities, yet the power and influence still goes to those considered the best and the brightest.

Those who demonstrate the highest level of expertise do the planning and goal setting, yet this doesn't mean that it is left only to individuals. Often, it is left to committees that, much like project teams, are comprised of those thought to offer the experience and knowledge to best create them. Membership in such committees is usually earned and determined by those with established authority. Regardless of longevity, when a person is no longer seen as sufficiently competent or as contributing significant knowledge or expertise, he or she is typically removed from the team. In many companies, the leader has the authority to create the vision and plan the future. In fact, often employees expect the leader to provide the direction and plan for the company or team.

In expertise cultures, the term “individual contributor” is often used, conveying the focus on individual goals and outcomes. In some instances, individuals are asked to define their own goals. In others, the supervisor, manager, or leader defines them. Sometimes the employee is asked to produce his or her own goals and a plan to achieve them, while the leader separately yet simultaneously does the same thing. Then, they meet and agree on a set of goals that incorporates both perspectives.

This construct can be applied on a larger scale and used for an entire company's planning and goal setting. Groups or teams throughout the company define their particular set of goals and plans, and then meet to agree on the companywide plan and outcomes. Often the process includes members from the different areas or groups who challenge each other and look for ways to improve the individual plans. This process is known as a “roll up,” because the individual parts of the planning are done independently and then rolled up into one companywide strategy or plan.

In relation to leading and managing change, expertise cultures work best when individuals are change champions and teams are change initiators. Because of the natural energy of people within the culture to want constant advancement, there is an organic element of change and, because the culture reinforces the competitive nature of the individual, there is a natural propensity for creativity and innovation. The expertise culture is the ideal place for self-starters and people who want to be their best, to be challenged and grow, and to work in a passionate and creative environment. This offers an opportunity for anyone to step up, take ownership of their own future, and perform to the highest potential. All of this provides the fuel for change and innovation.

When it comes to problem solving, the best and brightest people are relied on to solve problems; often the highest performing employees are the “go-to” resources and enjoy the reputation of creating solutions and answers to the most pressing or difficult problems. Unlike a participation culture, where teams and groups are brought together to solve problems, expertise cultures engage only those who need to be involved—people with the specific skills and competencies to solve the problem or have the authority to make things happen. Members of participative cultures enjoy meetings; members of expertise cultures avoid them. Unless there is a personal benefit, meetings can often be seen as a waste of time and a distraction from getting work done.

Decision making is generally top-down or content specific. When it is content specific, decisions are left to those with the greatest knowledge, expertise, and know-how. Often, a leader calls on the expert to come up with solutions and make recommendations, and then makes the decision. Because the ongoing nature of the culture promotes individual performance and accomplishment, some of the best decisions come from people challenging one another; the company or team benefits from the creative thinking that evolves from it. In most expertise preference companies, the influence on decision making and the decisions themselves are made from the top, even when a company is very large. In some instances, the culture supports a militaristic approach to decisions. At Samsung, a company of close to 370,000 employees, the direction and decision making comes from the top and directives are closely followed. This cascades through the organization and is reflected in how most problems are addressed and how decisions are made.

When managing conflict, expertise cultures typically like a good argument; people enjoy challenging each other's positions, thereby creating an environment that promotes digging deeper into a problem and applying logic and data to reach the best outcome. Argument is based on fact, logic, and sound reasoning; it is not driven by emotion. A participation culture seeks common ground and collaborates to find the “we”; expertise cultures lean toward the “I.” Resolutions to conflict are achieved by finding the right answer, and the tendency is for people to want to be right. Conflicts are also resolved by the leader, who has the authority to step in and decide the issue.

Another way we can differentiate culture preferences surrounding disagreement and conflict is by tracing the origin of the conflict to the key emotional influencers of the culture. In a participation culture, conflict mostly begins when people feel left out or ignored. In expertise culture, it originates from issues about who is right and wrong, about whether people have had the opportunity to demonstrate their competencies and capabilities. It is about who has individual authority, and how that authority is used.

This insight also applies to how conflict is best managed. Participation cultures prefer group involvement. In expertise cultures, individual challenge and argument serves best. One is not better than the other. It's a matter of how it aligns to the preference of the culture and the predictability it offers its members. Dealing with conflict is difficult not just because we fear that our needs won't be met, which is the most important aspect. Often, it is also because we fear the consequences and outcomes we'll be contributing to if we fail. In expertise cultures, the message when someone falters, missteps, or makes mistakes is to recover quickly, learn from your mistake, and try not to do it again. If you don't, you won't be there much longer. Although the culture expresses the idea that taking risks is good, if the actions of its leaders are misaligned, the message is lost and employees fear taking chances.

Many of the lessons about the values and beliefs of the culture, the rules of how people engage and interact, and what is acceptable and unacceptable behavior are learned by observing how people manage conflicts. Employees who have a clear idea of a culture's expectations for managing conflicts appreciate the predictability and feel empowered. In expertise cultures, where the emphasis is on competence, this is vital.

The primary approach to incentive and reward in an expertise culture is individual: pay-for-performance, competency-based pay and status, promotion and rank, and tying reward directly to the outcomes of the employee's efforts. Individual recognition is a source of motivation. One company I worked with created a technical “hall of fame,” with companywide recognition going to those who made the most significant and innovative contributions to its technology. Another aspect of incentive and rewards are what we commonly refer to as “perks”: company-funded travel, vacations and holidays, flexible working hours, club memberships, professional development opportunities, and assorted personal favors. Although a goal of expertise cultures, in general, is to directly connect compensation to performance and achievement, discretionary rewards and perks often reflect the preferences of leaders to reward those who best serve their own goal attainment and personal success. (Note: This is not unique to expertise cultures, and you should pay particular attention to it.)

Hiring in expertise cultures, like McKinsey and Company's, is generally competency focused. The process centers on finding and hiring the person with the best skill, knowledge, and aptitude for the job. Compared with participation cultures, which look for the best team and interpersonal fit, the expertise culture puts greater value on first finding the right set of competencies and worries less about culture fit. In some instances, strict adherence to policy and procedure is followed; in others, experts recruit people with the expertise they need and then concern themselves with what is required to hire them.

For example, I coached a company leader who meets with people who have specific competencies and appear to be an excellent fit for his company's culture. He then finds a position or creates an opportunity for them. He sees it as one of his critical competencies. Although he does this outside the company's normal hiring process, he has had such a high degree of success, it has become an accepted norm.

Orientation in an expertise culture focuses on policies and procedures and getting the newcomer to work and contribute as quickly as possible. The message often is “Welcome. Show us what you can do.” In contrast, in participation cultures, the emphasis is on getting to know everyone and learning how to fit into the team.

Role definition is highly oriented to leveraging abilities, skills, and know-how. For this reason, expertise cultures are organized into functional areas and teams, which allow for the predictable application of specialties and increased efficiency. Great emphasis is on how people can best apply their skills to their roles and their titles, such as test technician, marketing specialist, account manager, reflect this. For consultants, McKinsey uses role definitions and titles, such as specialist, expert, and senior expert, which are forms of organization, competency recognition, and level of position power.

Customer interface is left to those who demonstrate that specific competency, and most expertise cultures organize functionally to meet the product or service requirements considered to be most important in conveying value and brand intention. Often this results in functionally oriented customer service teams, where those with the highest level of customer management proficiency are in roles that best respond to the customer's needs.

Apple's retail stores are excellent examples of how role definition, brand intention, culture, and customer experience are aligned. Apple's stores are organized by product competency and aligned role definitions. As we've seen, the customer is greeted by an employee whose role it is to direct customers to the person with the specific product knowledge they need. Because Apple sells preeminent products, this approach offers a high degree of alignment with customer motivation. Those with the highest degree of competency get to work in the roles with the highest level of status and respect—the genius bar.

Teamwork has a functional or project focus. The emphasis is on bringing together individual competency to leverage group performance. When teams are functionally oriented, how well a team can focus on a particular part of the whole is key. This can apply to an operational element of a company or a specific part of how a product or service is created and delivered. It requires meeting the contradictory challenge of simultaneously separating parts while bringing them together. This is a challenge for all cultures. However, it is especially true for expertise cultures.

Because functional teaming is challenging, companies are increasingly adapting and applying variations of project, program, and ad hoc teaming, which some expertise cultures refer to as cross-functional teaming. Whatever label you use, it's a matter of aligning everyone to how it works and what their part is in making it work successfully. This can happen in formal or informal ways.

The more formal approaches to program and project teaming include the process of project planning, which includes defining roles, identifying the required knowledge and skill sets, and then assigning people to fill the roles and deliver the required outcomes. This approach lends itself well to both breaking down some of the silos attributed to expertise cultures and better utilizing talent.

The other approach encourages people to seek out one another across functional boundaries, practice areas, and the various centers of competency. Unplanned and impromptu teaming is an aspect of high-performing companies that translates into greater speed, collaboration, information sharing, and the culture values of agility and empowerment. It also results in higher levels of transparency and trust across different parts of the company. For this reason, it's always worth exploring further. This is particularly true for expertise cultures.

How people team depends on structure. Expertise cultures most often structure in ways that emphasize the coming together of functionality and hierarchy. The organization of how things get done and who does them directly reflects the emphasis on competency and expertise. To further leverage these traits and to align to the goal of increased collaboration and communication, companies are increasingly using formal matrix designs and structures, resulting in improved cross-functional work processes that can incorporate program and project teaming and increase the opportunity for informal and unplanned teaming.

The aligned values of expertise cultures can be described using words such as challenging, expertise, analytical, innovative, superior, excellence, world-class, preeminent, solutions-oriented, leading edge, quality, high-performing, entrepreneurial, fast-paced, unique, accountability, mastery, teamwork, integrity, professionalism, achieving, and personal excellence. These describe the shared values that are common to expertise-preference cultures. For them to become shared values, as demonstrated through intentional action, requires a clear definition and alignment to what the company does, why it does it, and how it does it. Without that clarity and alignment, they are just words.

THE AUTHENTICITY PREFERENCE

Some words, such as love, truth, peace, compassion, and freedom, that describe the human experience don't immediately connect to most definitions of company culture because they don't resonate with our everyday connection to the products or services we buy. Yet, we notice them when they are missing and tend to try to find our way back to them. Why? Because it's natural for us to be inspired to connect and work together for the wellness of our shared humanity.

Several years ago, my wife and I and our four children found ourselves in an open Colorado field preparing to spend the night in a small shelter built from cardboard boxes. We were a part of a larger group that had come together to support a not-for-profit named Invisible Children, whose mission is to stop Joseph Kony and Lord's Resistance Army from abducting, killing, and displacing civilians in East and Central Africa. For decades Kony has been the target of an immense manhunt involving a collaborative effort of four African armies and the U.S. military.

Over a period of thirty years, Kony has killed thousands of civilians and is said to have abducted over 25,000 young boys, who are indoctrinated into Kony's army as child soldiers.

At the event, we briefly experienced what life as a displaced family was like, eating saltine crackers for lunch, dinner, and breakfast. The women and girls stood in long lines to get a small amount of water, and we slept on the ground. We were engaging in a shared experience of empathy and compassion.

Fast-forward several years to a conference room in Dubai. I was invited by Legatum, a global private investment group that allocates capital to businesses and organizations that sustain human development, to share my work and engage in a conversation about alignment. Along with an exceptional history of asset management, the group members have a shared commitment to the distribution of capital to fund and support extraordinary humanitarian efforts and worldwide economic development. Legatum passionately supports entrepreneurship and provides the stewardship required to assure its longer term success.

Several years ago, in the support of a not-for-profit working to protect innocent children, they funded a documentary titled Invisible Children. It was the film that captivated my family and led to our participation. When I entered the conference room in Dubai, I did not know the connection. Legatum is a wonderful example of a global business that provides insight into the characteristics of an authenticity-preference culture. When an authenticity culture is in alignment, it demonstrates an intention to aspire to a set of higher ideals. It undertakes goals that convey a sense of purpose that can lift the human spirit and then achieves them. In authenticity cultures, power and influence is gained by demonstrating a commitment to the company's values, higher ideals, and mission. Those who interact with others in charismatic and inspiring ways often have the greatest influence. It is not about being the best, the brightest, or the friendliest; it is about being genuine, being authentic, and engaging others. Being optimistic and positive, as well as showing compassion and empathy, generally result in the ability to have an effect on others.

Planning and goal setting is centered on the values and beliefs of what is possible and best delivers to the cause. Participation in planning is most often group based; there is a sense of community in how people come together to agree on goals. A shared sense of purpose and an organic process is not an unusual way for an authenticity culture to strategize. Methods similar to open space and blue sky are planning and goal-setting approaches that are value driven and aim at building mutually satisfying outcomes are common to authenticity cultures, conveying an “anything is possible” attitude.

Problem solving is focused on the intention of the group and often involves open dialogue about what solutions may work. Subjective and intuitive approaches are considered and often given as much or greater attention than more analytically based ideas. Group members expect one another to be open to sharing and hearing each other's ideas, thereby promoting creativity and provoking imaginative thought. In an authenticity culture, employees are welcome to contribute insights and ideas, regardless how “out of the box” they may seem.

Decision making is often influenced by ethical and moral considerations and filtering decisions through the lens of whether they align with what the right thing to do is. How a decision aligns to the core values and beliefs of the group is more important than its measurable financial or performance outcome. Finding alignment between the two offers the best alternative. Everyone has a voice and the intention is for every person to be heard.

An example of this is an alternative elementary school, which at its founding adopted an inclusive governing model that centered on a unanimous decision-making process. At first, it posed a risk to many who had been involved in parent groups that had relied on majority-based decisions and voting. Over time, the teachers, parents, and community members found the openness and honesty empowering and discovered that accessible dialogue lessened the politics associated with the governing of a school. As with any culture, there were parents and teachers who chose not to stay. In a relatively short period of time, the community became aligned.

Over two decades later, Horizons K-8 in Boulder, Colorado, still uses the same decision-making model. Before every meeting, the decision-making process is reviewed to remind everyone of how things get done and of the values that provide the foundation for the methods and processes the culture engages in.

In an authenticity culture, disagreements and conflicts are usually dealt with openly. While individuals typically are rigid in protecting the company's values and ideals and its definition of the right thing, members of authenticity cultures pride themselves on self-awareness and flexibility. Conflict resolution generally meets the needs of the parties involved and is often perceived as an opportunity to further develop the relationships of those involved, including feelings of intimacy and trust. A great degree of emphasis is placed on genuineness and honesty. Open expression of thoughts and feelings is expected; employees who are perceived as disingenuous or withholding typically find themselves in jeopardy.

In authenticity cultures, incentives and rewards are intrinsic and members are motivated more by the company's purpose and values. L'Occitane is a good example. Employees at the store level are not high-income earners, yet they take pride in connecting with customers and taking care of them. A high degree of alignment exists between the individual employee and the customer motivation for caring. The company also places value on caring for its employees and encourages a sense of service that creates an emotional thread that connects leadership, the culture, the employee, and the customer. L'Occitane has a very well aligned authenticity culture.

Another form of reward in an authenticity culture is personal development and self-actualization. Because the culture honors self-expression and openness, the opportunity for personal growth and the pursuit of one's professional and personal passions are great motivators.

Hiring is highly intentional and decisions are based primarily on how prospective employees connect to the company's purpose and culture. Of the three cultures, authenticity cultures have the easiest time finding the right fits probably because of the attraction of the company's purpose and the highly intuitive aspects of its culture. Often, there is an immediate connection with new hires similar to when kindred spirits meet. While this can happen in participation and expertise cultures, it is less likely that a person, especially a new hire, would express it as freely.

The criterion that authenticity cultures rely on in their hiring is the alignment of an individual's sense of purpose and personal preference for being forthright and open. In working together, this means being caring and considerate and building relationships that are open and honest. This shared quality further aligns to how the customer is treated and the willingness of employees to help one another. This sincerity is conveyed to and reinforced when a new member joins the group. Much as the participation culture helps newcomers feel included and an expert culture invites them to show their competency, the authenticity culture conveys acceptance.

These qualities show in how authenticity cultures approach role definition. A sense of individual empowerment allows people to pursue that which best satisfies the immediate fulfillment of the company's purpose. Zappos, the online shoe company, is a good example. From the outset, employees were encouraged and empowered to choose and take on any role to do what was needed to deliver happiness to the customer. This meant that someone in an IT role could jump in to fill orders or stock inventory. This dedicated and value-centric culture allows team members to help and mentor one another. There is always a risk that self-interest can get in the way of fulfilling the obligations of their assigned role, whereas in an authenticity culture, there is greater emphasis on not letting one another down. Because there's an ongoing concern about being able to say no, employees are more likely to help when asked, even when they are stretched.

Bruce Lish of Blue Diamond Almonds, whom I introduced you to at the beginning of this chapter, is another good example. Bruce filled various positions throughout his career, stepping into different roles as the company and situation required. His goal was to serve the company and those around him. While his roles were formally defined, he was free to contribute in the manner that best responded to the company's mission, purpose, and culture.

When it comes to customer interface, the same ethos applies. Customers are to be connected with and cared for. In an authenticity culture, regardless of an employee's position or role, everyone is empowered to provide service. This empowerment allows employees to make the decisions necessary to achieve customer satisfaction. In participation cultures, the customer's satisfaction is measured by how attentively they are treated; in an expertise culture, on how competently the customer's needs are met; and in authenticity cultures by how well mutual benefit and trust are achieved.

Teamwork comes fairly naturally to authenticity cultures. The key motivation is shared ideals and values. Individual teams are often empowered to take responsibility for their own planning and goal setting, which can include the team's definition of its mission and strategic vision. One might think that this would result in multiple teams with misaligned goals and strategies, yet this rarely happens in authenticity cultures. A good example is Whole Foods. In going store to store, most customers wouldn't even notice that the employees write the mission statements posted on the blackboards at each location. That's the strength of Whole Foods’ authenticity culture, its mission, and shared ideals.

At Whole Foods, the commitment of its employees to the company's mission and culture supports why Whole Foods can successfully structure its employees into self-directed work teams. Authenticity cultures are able to engage in unique structures. The more the structure organically aligns to the flow of how the product or service is created and delivered, the easier it is for employees to leverage their empowerment. As a result, a company may find itself using a hybrid of structure options. This is a natural way authenticity cultures express themselves.

The aligned values that are common to authenticity cultures include inspiring, values-driven, caring, values-centered, integrity, truth, transparency, generosity, creative, uplifting, self-expression, actualizing, spirituality, positive, realizing, optimistic, faith, and love, among others.

ALIGNING THE IDEAL CULTURE

When it comes to defining a company's unique culture, along with the 12 culture keys, there are other characteristics to be considered. These include meetings, performance management practices, training and development, time-off and employee leave policy, attire, employee discipline, tuition and education assistance, employee communication, information technology, and the processes and tools used in measuring, reporting, and assessing performance results. Based on these and others, you can determine what characteristics best align to and serve the company. Whatever is in the best interest of alignment, with few exceptions, is in the best interest of the business.

It is the pursuit of such alignment that results in the linking of a company's culture to the needs of the customer. As the Figure 9.1 shows, extraordinary companies have brand intentions that align to the three customer motivations, six brand intentions, and three preferences of culture.

When you look at how the customer, brand intention, and culture come together, it becomes obvious that success requires that the company align with the emotional thread that runs through the three preferences. This connection motivates the customer and encourages employees to work together in a manner that is aligned to customer needs and brings the brand intention to life in a way that results in the customer's trust. A company's culture brings this to life.

Figure 9.1 The Ideal Culture

The next question is what does an ideal culture look like. To begin with, all three culture preferences can result in high-performing companies, so no one approach is better than another. Assuming a company's culture preference is aligned to its brand intention, how things get done internally is aligned to the external experience and meaning for the customer. For leaders, as well for its members, a company's unique approach to its culture's preference provides insight into the psychological and emotional threads that connect it to its mission and purpose, its customers, and its brand intention.

There is no one size fits all approach. The highest performing cultures are those with a clearly defined preference that also integrate traits and characteristics of the other two. To be successful, the preference and specific makeup of the culture must be clearly articulated.

As examples:

• At the team and company level, Whole Foods integrates elements of expertise in how it tracks and measures performance results and uses self-directed work teams to integrate ongoing participation into its authenticity culture.
• SAP uses online communities of practice, forums, and project teaming to integrate participation into its expertise culture.
• McKinsey and Company relies on strict adherence to standards of ethics and transparency to bring elements of authenticity to its expertise culture. It uses a matrix structure to integrate participation.
• Blue Diamond has a keen focus on quality and food safety, incorporating elements of expertise into its authenticity culture. Employees work in cross-functional teams, share roles, and participate in line dancing during breaks to integrate participation.
• The team at Decision Point Associates engages in high levels of communication to assure it delivers expertise in its tailored solutions. Its value for human life and safety integrate authenticity.
• Legatum has a clear value for high-level results that challenge employees and the group, integrating aspects of expertise into its authenticity culture.
• Teams at Harley-Davidson incorporate quality assurance methods, integrating expertise into its participative culture.

These examples demonstrate how aspects of two cultures are used in the service of company cultures. When introducing and integrating specific strategies and ideas, it's important to realize how relatively easy it is to cause confusion. For this reason, when strategizing how to best align a company's unique culture, there are four considerations. First, take great care in aligning to the business strategy. Be very intentional about it; it's easy to drift and dilute a culture. When this happens and the company again changes direction, the starts and stops and inconsistencies leave employees wondering if they're facing another “flavor of the month,” if they know what they're doing, and whether they can trust the culture to be predictable.

Second, make sure that all leaders are in alignment with one another. If they are not, employees will sense the conflict, see the lack of commitment, and lose confidence in the culture, as well as in their leaders. The company also runs the risk of groups and teams disagreeing and finding themselves in conflict with one another.

Third, leverage culture to create change. In psychology, one approach to change is known as paradoxical intervention. Much like reverse psychology, in organizational or group contexts, this approach suggests using an already present aspect of group behavior to achieve the change being sought. For example, if a participation-culture team needs to increase a specific area of expertise or competency, instead of hiring a new member, the leader brings the issue to the members of the team and asks them to decide how to increase its capability, thereby leveraging the team's alignment to group problem solving and decision making.

Another example is a group of leaders of functional areas within an expertise culture struggling to communicate and collaborate. Rather than putting them in a room and expecting them to engage one another, the leader addresses each individual and sets personal expectations for their behavior to become more aligned with how things are to get done. Adding individual measurement and a feedback mechanism adds to the likelihood of success, as would personal leadership coaching that aims at the interpersonal and collaboration skills the individual needs to develop.

Assessing how well each works with the others and observing and measuring their overall improvement is a means of challenging each person. This is one of the reasons executive coaching and 360-feedback tools are used as much as they are in expertise cultures. The path to creating a better collaboration begins with a focus on improving the individual. If the team does engage in teambuilding activities and exercises, it's important to make sure the training aligns to the culture. Nothing is worse that a team spending time and energy learning team skills and processes that do not align to the culture and won't used.

Living in Colorado, I've facilitated a good deal of outdoor teambuilding. For teambuilding to work, it has to align to the culture in which the team operates. If I were to tell an expertise preference group to plan how to get down a river together as quickly as possible, they will try to determine who the experts are, who should lead, how to distribute competencies (and who gets the weak players), and be somewhat reluctant to stay together. Even if I were to instruct them to wait for one another and try to stay together, their natural tendency is to create teams and race down the river. They may even sabotage one another in order to win.

It would be more beneficial to instruct them to organize into teams and have a race and, as part of the experience, ask them to explore what they can learn about their actions and how they can improve their teamwork. By the way, expertise teams also like to drive racecars around a track to see who is the fastest—and call it teambuilding.

If I ask a participative team to race down the river, they are likely to join forces and help each other navigate as successfully as possible. They might, for example, tie rafts to one another to assure their entire team floats down the river together, although they were asked to compete.

For an authenticity group, you might need a raft or two, kayaks, and tubes, and then empower to go down the river in the fashion that suits them best. The most important part of the exercise is at the end, when participants are asked to reflect on their journey and share their personal experience. Based on their new self-knowledge, they will likely describe how they can individually and collectively apply their learning to self-actualize and increase their contribution to what they do.

The fourth is a reminder that to be successful requires ongoing and clear communication. It is just too easy to go off course. Leaders have to consistently engage employees in an ongoing conversation about the company's culture, how its traits of preference align to its brand intention, and how it aligns to its customer.

Applying the framework for alignment provides leaders with additional insight into a host of challenges they typically encounter, including the “us versus them” effect of subcultures that are in misalignment, thereby allowing the leader to change the culture of the group or to integrate it into the rest of the business. Lastly, it provides a roadmap for planning that can lead to the alignment of human resource and organizational development practices, including approaches to teambuilding and leadership development.

SOME OTHER THINGS TO THINK ABOUT

When it comes to aligning culture, there are a few other risks. The first concerns language and terminology. As with any business framework or model, it's easy to use language that is unfamiliar or that does not align with how people actually communicate. When it comes to applying the Business Code and the traits and characteristics of culture preferences, leaders should use the language that is prevalent in a culture and pay particular attention to being clear and consistent about definitions and how they come to life as behaviors and norms. The term “collaboration” is commonly used across all three culture preferences and across companies, yet the definition varies. That being said, whenever new terminology is introduced, it's important to define what it means.

All cultures will have stories. Be aware of them; they tell you a great deal about the culture and its artifacts, values, and beliefs. In defining and creating clarity, a culture's stories offer leaders wonderful opportunities to connect with the norms and values of a culture. They also help employees connect with and better understand a culture's preference and uniqueness.

When a company discovers or intentionally pursues multiple brand intentions and market strategies, examine the consequence on the alignment of that strategy to the culture. It is much easier when the strategies are aligned. A good example is Toyota and Lexus. One of the reasons this has worked so well is that both brand intentions are aligned with the company's expertise culture. Another is Harley-Davidson's strategy to offer customized motorcycles. Because both community and customization are aligned with the company's participation culture, the likelihood of success is greatly increased. Furthermore, the culture and brand intentions are aligned to the customer motivation and provide the common emotional thread that gives the brand and customer experience its power of trust.

In working with companies considering new brand intentions or customer strategies, I always suggest exploring how it affects the company's alignment. One option that has served many companies well is to establish a separate group or team, with a separate subculture that aligns with the brand intention. This requires diligence and commitment. Leaders, like the rest of us, tend to want everything to look and feel alike.

Alignment is a very valuable asset when considering mergers and acquisitions. Much like when companies fail by pursuing a strategy that doesn't align to their cultures, the rate of failure for mergers and acquisitions is astounding. Most studies and experts put the failure rate at 70 percent or higher. One of the major factors, perhaps the major factor, is an inability to integrate cultures.

Using the Business Code and alignment as the tool for due diligence and strategizing brings great value to the process. There are four reasons to engage in a merger or acquisition. The first is to bring companies together to increase shareholder value. If that's the only reason, you risk not getting there unless the cultures align. Some barriers to alignment usually surface, and some can cause big problems, both strategically and financially.

The second is to buy or combine market share. Unless it's a commodity and people don't care where it comes from, if the cultures don't align and the customer experience isn't the same, the customers will be disappointed and spend their money elsewhere.

The third reason is to deliver increased operational capability. While this is all about integrating systems, processes, and technology, if the cultures are not aligned, success can be achieved only if the employees of only one of the companies are needed. Yet even this is not easy because much of the success in applying systems, processes, technology, and the like relies on the skills, knowledge, and competencies of the people who run them. Lose the people, and you may lose significant value.

The fourth reason is to buy technology or the competencies and talents of people, which often come together. In this scenario, if the cultures of the companies don't align, if you're just buying the intellectual property and don't need the people, the merger or acquisition has a better chance of working. Yet, even then, you may run into situations where people in the acquiring company are resistant to the new technology or the customer is not interested. If it is all about the competencies, knowledge, and skills of the people and the cultures do not align, it's likely not to get the desired results.

The Business Code provides a great vantage point from which to better predict whether an M&A will result in success or failure. While the three culture preferences afford the opportunity to assess the alignment and misalignment of two companies and their cultures, it's still important to delve deeply into the details of each culture. Two companies may have the same culture, yet each is unique. In searching for those unique qualities and nuances, you may find misalignments in traits and characteristics that are difficult to manage and overcome. For this reason, the twelve culture keys are valuable in the due diligence and assessment process.

These are all valuable applications of the Business Code to the alignment of a culture, providing a clear path to strategizing the alignment of a company's brand intention and culture to the customer is one of its greater assets. Next, we'll consider the fourth element of The Business Code: leadership.