I detest nearly all engagement surveys. They destroy value while promoting “satisfaction.” Nowhere is this more apparent than when an organization needs to introduce significant change that creates culture clash.
A case in point. The call from a recently promoted CEO was blunt. He was making change happen and the first engagement survey scores from his tenure showed a drop from the prior CEO’s scores. People were worried that talent might leave. He talked of his first-year accomplishments: a long-needed M&A transaction to gain market share and complementary products (a clash of complacency vs. competition); revamping an unsustainable rewards program (a clash of seniority vs. meritocracy); delayering two levels of management (a clash of tradition vs. efficiency). All this work was increasing margin and sales, but his KPIs (key performance indicators) were tied to increasing employee engagement as measured by the annual survey.
He was adding value but losing “engagement.” In fact he wasn’t losing engagement–he was losing satisfaction masquerading as engagement because of the survey’s design.The more he unpacked the situation the clearer it became that his engagement survey was one that confused productive engagement with employee satisfaction and desire to stay. He was being “punished” by the survey for doing the right thing. People naturally felt more dissatisfied during periods of change; this was more about people’s reaction to change than to him..
I texted him the photo that leads this post—the one of me standing in front of Frank Gehry’s spiral staircase at the Art Gallery of Ontario (AGO). The staircase couldn’t be more different in design from the surrounding architecture—a classic case of culture clash. It caused a real fuss with traditionalists when they saw how Gehry had “violated” the traditional museum aesthetic with his swirling, frame-breaking staircases (some of which had no stairs and were deliberately too narrow in order to get people closer together!).
I drew a lesson for the CEO from Gehry’s work at the AGO: Culture clash can be a good thing (1) when it’s done right, (2) for the right reasons, and (3) with the right leadership.
Culture clash can be done right. There are many ways to screw up cultures that clash at work. According to the Harvard Business Review, companies spend more than $2 trillion on acquisitions each year, with between 70% and 90% of them failing to reach their economic targets because of culture clash and loss of key talent. Culture clash can be painful, even debilitating. M&A is the most dramatic source of culture clash, but other more mundane reasons abound: reorganization, leadership change, compensation/bonus schemes, generational shifts, etc. Our research shows that individuals going through significant change at work can become up to 60% less productive for extended periods of time. Many organizations compound the ill effects of culture clash by failing to measure and reinforce the constructive aspects. For example, traditional engagement surveys often overweigh the emotional symptoms of dissatisfaction when what’s needed is “root cause” information on how the culture clash is being managed. For nearly three decades we’ve found that organizations that correctly measure strategic engagement during times of culture clash (or disruption) wind up with superior results in spite of the dissatisfaction. Here’s what gets reported to the CEO and goes into his/her KPIs (what gets measured gets noticed):
- The extent to which people fully understand the long-term direction of the organization. When they are clearly focused, they are able to connect their activities to co. direction.
- The level to which people feel that objectives are truly stretching, but attainable.
- Change orientation. The sense of how well the organization responds to change, keeping unnecessary procedures to a minimum and encouraging the questioning of established ways of working.
- The extent to which people are able to get on with their jobs, making decisions without checking with their manager. They feel accountable and are prepared to work outside the remit of their jobs to deliver results.
- The degree to which reward is directly and differentially related to performance. People know how well they are doing, feel valued and appreciated.
- The level of importance that is attributed to the role of the team; there is a shared commitment and sense of alignment to team goals.
Notice how different this measure of engagement is from typical surveys. It gives the CEO or BU leader the tools to focus on the right kind of activity and catch people “doing things right” for the business challenges. It can also capture the necessary discomfort that comes with growth, change, and culture clash. This way of managing culture clash directs resources and money into strategically significant engagement rather than chasing momentary “feel good” initiatives (HR can earn a seat at the table by making this distinction).
Culture clash can be done for the right reasons. The right reasons for the AGO to introduce culture clash came from a $500 million donation from Kenneth Thomson (of Thomson Reuters). AGO commissioned Gehry to make a bold design statement, commensurate with Thomson’s gift. Years ago Gehry helped me when I needed fresh thinking about complexity, culture clash, and change. He offered a key insight: have the courage to challenge the way things work if work no longer fits the purpose. Gehry invited culture clash for the right reasons at AGO. He used the clash of ideas, space, and culture as a way to get people more engaged with the AGO rather than less so. He designed a new façade for the museum that had no room to expand since it already fronted the sidewalk. He enlisted 50 Italian families living in Toronto to each donate $50,000 for an elegant glass and wood façade that soared over the sidewalk, hence the new Galleria Italia. It brought light into the museum’s new collections while working with incredible space constraints (a must see on your next Toronto visit). The end result? A culture clash that increased the economic and aesthetic value of AGO rather than destroying it.
I think of two past clients who excelled at doing culture clash for the right reasons. MTV Networks thrived on chaos and clashes. The average age of an executive at the network: 28. Clashes were seen as vital to surfacing new voices and POVs that challenged existing ways of programming, going to market, etc. It wasn’t for everybody, but for those who understood the purpose behind the noise it was magic.
A second client had a more formal approach to culture clash. Nissan created several automobile categories under the guidance of its design center leader Jerry Hirshberg. Jerry, who wrote a book titled The Creative Priority, laid out eleven principles for increasing business creativity, and the Nissan Design International (NDI) practiced all of them. One of the principles was to embrace conflict. Better design came from people who knew how to clash for the right reasons. Systematically building conflict and clashes into your operating platform may not be everyone’s choice, but if innovation, change, the creation of crisis, or momentum is a fundamental need for your business, then it’s essential to constructively plan for and manage culture clashes.
Culture clash can be done with the right leadership. Two aerospace firms came together through a merger of equals (on paper). The two senior teams came together for their first offsite with the purpose of reviewing the results of their respective culture surveys. They showed clear agreement in mission, vision, and strategy. They were not in agreement about customers. One valued service above all else. The other valued volume above all else. As they got into the customer issues, their emotions and tempers increased—reason fled the building. As their facilitator I called a timeout and had a sidebar “chat” with the two leaders. They needed to find a way to optimize the differences rather than demand capitulation from each other. They each had loyal customers for a reason, so their job was to find a way to retain and grow the existing customer base. They agreed to reframe their culture clash and give me the rest of the day off in the wine country while they sorted through their issues privately. When I joined them for dinner, the climate had clearly changed—for the better. They happily informed me the clash had opened up new ways of thinking about customers, markets and a unique value proposition. A joint market team was working overnight to propose a “third way” to optimize service and volume. The two leaders demonstrated the right mix of assertiveness, clarity, and involvement. They were also quick to take coaching! All these elements were needed to turn a culture clash into an economic opportunity.
I’m acutely aware a lot of culture clash takes place because of the wrong approach, the wrong reasons, and/or the wrong leadership. Sometimes this is inevitable because financial or other pressures drive people to make bad decisions. In those cases the clash leads to a crash. But there’s no point in making the situation worse by using faulty methods or leadership to assess what’s really going on with culture engagement. Learn from Frank Gehry: bring on the clash—intelligently.