Culture and Effectiveness « Wayne Hastings

Daniel Denison is one of my favorite spokespersons on corporate culture. What I appreciate most about Denison is his research showing how culture leads to corporate effectiveness (results). Denison has developed several tools to help companies understand their culture and the measures are strong predictors of future financial performance of the organization In other words, the culture you as a leader create leads to predictable financial and market outcomes. Further, if you want to change your current outcomes, look at what changes you need to make in your culture in order to reach the vision or goals you have established.

Last week I began to take my leadership team through Denison’s model. My plan is to use this Blog as a training tool for them, and anyone who reads the next few posts.

The Beginning:

As a first step, let me share with you from Denison’s book, Corporate Culture and Organizational Effectiveness.

1. Effectiveness (or lack of it) is a function of the values and beliefs held by the members of an organization. Shared values and beliefs become the fundamental basis of coordinated action within the organization. This involves mission and the consistency in which the organization holds to the mission and the beliefs and/or assumptions held by the organization.

2. Effectiveness is a function of the policies and practices used by an organization. H/R strategy, internal environment, conflict resolution, planning or making decisions all create a culture have impact upon an organization’s level of effectiveness.

3. Effectiveness is a function of translating the core values and beliefs into policies and practices in a consistent manner. Building a strong culture demands that vision and practices are consistent throughout the organization. Leaders need to not only preach, but also walk the talk consistently with the core values and beliefs.

4. Effectiveness is a function of the interrelation of core values and beliefs, organizational policies and practices, and the business environment of the organization. There is a strong correlation between effectiveness and this interaction. If the interaction is muddied (in the eyes of the employees or customers) or inconsistent the resulting culture may not reach the intended result(s).

Over the next several posts we’ll look at Denison’s concepts and tools. We’ll learn how each shapes an organization to be effective in certain areas of business — one concept may produce high profitability, while another (or combination of two) may achieve high revenues and customer service. We’ll also discuss how you can apply each concept to your business with some real examples and thought starters. I would really enjoy hearing your thoughts and feedback about your organization.

The right corporate culture for your organization can create an effective enterprise that serves not only customers but employees and shareholders/owners as well.