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Core Culture

Do your hiring practices screen for culture fit? — Part 4

by Sheila Margolis on December 9, 2010

To ensure that you are selecting people who are a fit with your culture, evaluate your hiring practices. You want to hire people who will be a fit with the Core Culture—who find the work meaningful and are in harmony with the values of the culture.

To screen for culture fit, consider these five questions about your recruitment and selection practices:

  1. Do recruitment materials reflect the Core Culture?
  2. Do recruitment practices—before and after the candidate interview– support the Core Culture?
  3. When meeting with job applicants, do you talk about the organization’s culture?
  4. Do you model the Core Culture when meeting with candidates?
  5. Do you interview for culture fit?

Evaluate Your Recruitment Materials

Do recruitment materials reflect the Core Culture?

The way to get the right employees is to start out with a lot of good choices. Having well-​​constructed recruitment messages providing details that illuminate the culture of the workplace can affect job seekers’ perceptions of fit and thus influence their intentions to apply for positions (Roberson, Collins, & Oreg; Journal of Business and Psychology, 2005).

Think about the print materials you produce for job applicants as well as your internet communications. Because the internet is a commonly used resource for finding jobs, evaluate how you communicate online with potential applicants. Examine your website and the job applicant portal, in particular, as well as your pages on Facebook, Linked In, blogs or your communications through Twitter and others. Are you communicating your Core Culture beliefs at the first step of the recruitment process? Do those materials and communications align with your Core Culture? Do they share the Purpose, Philosophy and Priorities of your organization? Do they make it clear what’s important to your company, its contribution and character?

One example of aligning a recruitment message with the culture is the following information taken from the Disney website for job applicants. Disney is a company known for its Purpose—to make people happy—and they do it through the distinctive Philosophy of imagination. Disney is a place where they make dreams come true. On their website for job applicants it stated,

Welcome to The Walt Disney Company! Yes, there really are dream jobs. Here, the bottom line is imagination, our culture is magic and wonder, and required previous work experience: childhood dreams. Think of all the laughter, astonishment, joy and thrills that have come from this one place. Movies, Animation, News and Sports, Music, Television, Books, Theme Parks and Resorts. After all, a company built on imagination and wonder means the work will be interesting. And always will be. There’s room for talented people. It’s a dream job.

Their website for job candidates already begins the screening process to bring in people who are the right fit for their culture.

Communicating the company’s Purpose and values upfront helps filter out candidates who are not a fit. Your recruitment materials are a valuable resource for sharing your Core Culture in the first step of the hiring process.

[For continuation of Hiring for Culture Fit discussion, read the next post on topic: Part 5]

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Screening for culture fit begins with defining core culture-​​​​Part 3

by Sheila Margolis on December 8, 2010

To screen for culture fit, you must first define the culture of your organization. To understand the culture, you must look inside your organization to uncover its Core Culture. Think of your organization as a system of concentric circles—labeled the Five Ps. The core of your organization’s culture is in the shared center—at the organization’s core.

Core Culture is the essence of your organization’s culture. It is those few shared beliefs and values that serve as the foundation for why you’re in business and the framework for how you do your work. Core Culture consists of the central three Ps—the vital Purpose, the distinctive and enduring Philosophy, and the strategic Priorities that employees value. Core Culture is the heart and soul of the organization. To understand what the three Ps are for your organization, begin in the very center with your organization’s Purpose. As you discover what is meant by the Purpose, think about what it is for your organization and whether or not you are hiring people who find that Purpose meaningful.

The Purpose: the “Why”

The Purpose of the organization is the most central component of Core Culture. The Purpose defines why the organization exists. The Purpose is not the answer to the question “What does the organization do?” which typically focuses on products, services and customers. Instead, it is the answer to the question, “Why is the work of this company important?” This may sound like a simple question, but in its simplicity is significance for the organization and for each employee.

The Purpose is the cause that defines one’s contribution to society through work. Of course, businesses exist to make a profit, but they also exist to make a difference. Through work, employees can do meaningful work that makes a difference, and they can be part of a meaningful legacy. When the Purpose of the organization is meaningful to an employee, it provides a connection to work that is not just rational: it’s also emotional. When employees see the Purpose as challenging and meaningful, work is more than a job—it’s a cause that makes a difference in people’s lives.

A Purpose statement is only a few words, but they are important words because they inspire and motivate employees who care about making that contribution. The Purpose statement is brief so employees remember it and use it to guide their daily actions. Additionally, the Purpose statement is broad in scope to allow the organization to adapt over time to a changing world while its central focus remains constant. This broad perspective opens the organization to endless possibilities. Products and services often change, but the Purpose endures. Companies are living entities; they are vehicles for improving life and the world we live in.

If the organization’s Purpose is one that matters to an applicant, then working there can contribute to a meaningful life which enhances engagement in one’s work.

Key Points about Purpose

The Purpose of the organization is the fundamental reason why the organization exists.

  • The organization’s Purpose is central and enduring to the culture of the organization.
  • The organization’s Purpose is the cause that defines the employee’s contribution to society through work.
  • The Purpose statement is the answer to the question: Why is this work important?
  • A Purpose statement is brief in length and broad in scope.

Questions to Uncover the Purpose

To uncover the Purpose, ask two questions (although the second question may need to be asked several times to get to the Purpose):

  1. What is the purpose of this organization?
  2. Why is that important?

Criteria for a Purpose Statement

The Six Purpose Criteria

a) Is it a contribution to society—not a product or service?

b) Does it answer the question: Why is the work we do important?

c) Does it inspire and motivate?

d) Does it use powerful words?

e) Is the statement brief in length?

f) Is the statement broad in scope?

Deciding the Purpose

Together with all employees, decide the Purpose of the organization by asking the Purpose questions and uncovering the Purpose that meets all six criteria. This Purpose defines the contribution that the organization—and its employees—make to society. And it is the first filter to use in evaluating culture fit for an applicant. You must evaluate if this Purpose is personally meaningful to the applicant.

The Philosophy: the Distinctive and Enduring “How”

Just outside of the Purpose, in the three Ps of Core Culture, is the organization’s Philosophy. Where the Purpose states “why” the organization exists, the Philosophy directs “how” employees do their work. And “how” you do work matters. The Philosophy directs behavior across the organization. In successful organizations, employees consistently use the Philosophy to guide their decisions and daily actions.

The Philosophy may be one value or a small set of values. Many values may seem important, but the Philosophy is the value or values that are fundamental, distinguishing and enduring to the organization. They are the beliefs that have been essential and core to the character of the organization over the years. Employees believe that their Philosophy distinguishes their organization from others, particularly their competitors. And the Philosophy is the enduring core beliefs that typically do not change. The Philosophy is extremely important.

The Philosophy is like the personality or character of the organization. This personality or character is typically derived from the organization’s founder, or from the principles and ideals that drove the organization’s creation.

If a company has had a lot of change, it is often the leader who sets the tone for the Philosophy of the organization. The leader impacts the character of the organization and its vision.

The Philosophy is what employees value today, what was most important in the past and what will continue to be important in the future. Where the Purpose provides the foundation for why the organization exists, the Philosophy provides the framework for how that Purpose is delivered in a distinctive way. The Purpose is the heart of the organization, and the Philosophy is its soul.

When determining if the culture of a workplace is a good match for an applicant, in addition to screening for fit with the Purpose of the organization, you must also evaluate whether or not an applicant shares values that are aligned with the company’s character, its distinctive Philosophy. Finding candidates who obsess about “how” you do things at your company will produce a workplace where employees live the principles consistently. And consistent employee behaviors provide a predictable customer experience.

Key Points about Philosophy

The Philosophy of the organization is a value or small set of values that are fundamental, distinguishing and enduring to the organization.

  • The Philosophy is the special value or set of values that the founder possesses that has influenced the character of the organization.
  • The Philosophy is the source of the organization’s distinctiveness.
  • The Philosophy provides the enduring framework for “how” employees do their work.

Questions to Uncover the Philosophy

A few questions can reveal the Philosophy of the organization—its distinctive personality and character—guiding how employees do your work:

  1. What value is fundamental and distinctive to our organization since its founding?
  2. What special attribute does our company’s founder possess that has influenced the character of the organization?
  3. What ideals drove the organization’s creation?
  4. What makes this organization feel different from other companies in the same business?
  5. What is central to who we are as an organization that should never change?

Criteria for the Philosophy

The Five Philosophy Criteria

a) Is it a prime value?

b) Does it guide “how” employees work?

c) Do employees consider it a source of the organization’s distinction?

d) Is it derived from the organization’s founder or the ideals that drove the organization’s creation?

e) If changed, would that alter the personality or character of the organization?

Decide the Philosophy

Together with all employees, decide the Philosophy of the organization by asking the Philosophy questions and uncovering the Philosophy that meets all five criteria. This Philosophy is the value or set of values that are central and distinctive to the culture since its founding. Therefore, this personality or character must be a fit with each employee. The harmony between the organization’s Philosophy and the values of the applicant is another filter to use in evaluating culture fit.

The Priorities: The Strategic “How”

Priorities are the third component of Core Culture. Priorities guide “how” the Purpose and the Philosophy are put into practice. Think of Priorities as “strategic” values. Priorities are the values that will enable the organization to achieve its goals. Therefore, you must know your goals to define your organization’s Priorities.

Only a few Priorities are central to all areas of the organization. These are the key values that leaders and managers are focusing on—throughout the organization—to enable the organization to compete and thrive.

Also, specific areas of an organization may have additional Priorities that are unique to the area. The goals and objectives of each area inform the area Priorities.

In selecting people for culture fit, they must be aligned with both the organization-​​wide Priorities and the area Priorities where they will be working.

Priorities are relatively stable, but Priorities can change when the organization’s strategy changes. Also, new leaders often bring with them new goals that can affect Priorities. Altering Priorities is a way to shape culture and bring needed change.

Organizations must hire people who genuinely value and will naturally practice the organization-​​wide Priorities and the area Priorities where they will be working.

Key Points about Priorities

The Priorities of the organization are the strategic values that enable the organization to achieve its goals.

  • Priorities are the standards for behavior that direct how the Purpose and Philosophy are put into practice.
  • Organization-​​wide Priorities are limited to a small number of values that are important to all areas of the organization.
  • In a particular work group, additional area Priorities may be important to that group.
  • Strategy and leadership guide Priorities.
  • Priorities are those few values that leaders believe will enhance the competitiveness of the organization and enable it to thrive.
  • Priorities are relatively stable, but Priorities can be altered as leaders change and/​or as goals change.
  • Organization-​​wide Priorities are determined by the focus of the top leadership of the organization. Area Priorities are determined by the focus of those who manage the area where the employee works.
  • Fit with Priorities means that the applicant is a fit with both the organization-​​wide Priorities and the area Priorities where the applicant would work.

Questions to Uncover the Priorities

A few questions can reveal the Priorities of the organization—its strategic values—guiding how employees work:

  1. What should we focus on and pay attention to?
  2. To effectively achieve our goals, what values should guide everyone in how we work?
  3. What key values, if followed, will allow our organization to compete and thrive?

Criteria for the Priorities

Organization-​​wide Priorities

With a list of prospective organization-​​wide Priorities, evaluate those values against the Priority criteria.

a. Is it a key value and important standard to guide behavior throughout the organization?

b. Do top leaders believe it will enhance the organization’s ability to compete and thrive?

c. Does the value support the organization’s goals?

Area Priorities

With a list of prospective area Priorities, evaluate those values against similar Priority criteria.

a. Is it a key value and important standard to guide behavior in the area?

b. Do area leaders believe it will enhance their area and the ability to thrive?

c. Does the value support the area goals?

Decide the Priorities

Together with all employees, decide the organization-​​wide Priorities by asking the organization-​​wide Priorities questions and uncovering the Priorities that meet all criteria. Additionally, understand the area Priorities for where the applicant will work. These area Priorities must be decided by those of that particular area. The harmony between the organization-​​wide Priorities and area Priorities and the values of the applicant is another filter to use in evaluating an applicant for culture fit.

With a clearly defined Core Culture, you are positioned to design your selection processes so that you hire the right people for the culture of your organization—people who connect with the cause of the organization and who genuinely value and will naturally practice those few Core Culture principles.

[For continuation of Hiring for Culture Fit discussion, read the next post on topic: Part 4]

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Are you hiring for culture fit–like Warren Buffett?

by Sheila Margolis on October 27, 2010

In the Wall Street Journal article, “Buffett: Combs Is ‘a 100% Fit’,” culture fit is described as a critical criteria for selecting Buffett’s heir apparent:

Mr. Buffett says he and Mr. Munger (Berkshire Vice Chairman) were sold on Mr. Combs not only because of his ability and intelligence but also because they were convinced he would fit in to Berkshire’s no-​​fuss culture.

Buffett knows that a culture can change when a founder leaves an organization, and this can have a significant impact on the company and its future. Buffett states:

He is a 100% fit for our culture. I can define the culture while I am here, but we want a culture that is so embedded that it doesn’t get tested when the founder of it isn’t around. Todd is perfect in that respect.

So how do you determine if a candidate for a job is a 100% fit?

Companies screen applicants on at least two levels. First, they evaluate the candidate’s fit for the job. When evaluating an applicant for job fit, companies consider these questions:

  • Does this person have the knowledge and skills necessary for this job?
  • What past experiences have prepared the applicant for the job?
  • Do the strengths of the applicant match the requirements for the job?
  • Will this person be sufficiently challenged doing this work?

But more and more organizations are adding a second layer of questioning: to evaluate the candidate’s fit with the culture of the organization. When evaluating an applicant for culture fit, companies think about these questions:

  • Is the work of our organization something that is meaningful to the applicant?
  • Are the applicant’s values in harmony with the values of the organization?
  • Will the person naturally perform in ways that are consistent with how we do things here?

How well a job candidate fits the culture of a workplace can make the difference between job search success and failure. Those candidates selected on the basis of culture fit—in addition to job fit—will contribute faster, perform better and stay longer with the organization. Where culture fit is neglected, the burden is shared by both the employee and the company. Working at a company with values inconsistent with yours can be difficult, stressful and unrewarding. And if the new employee is the heir apparent, then the future of the company is at stake.

Culture fit is important for all potential employees. A person’s values are difficult to change. When you are not a fit with the culture of an organization, that fit cannot easily be altered through training and development. It’s just not the right place for you and not the right life for you to live.

Seeking that 100% fit is important in hiring employees and is essential in picking top leadership. This is why many organizations promote succession planning where internal candidates–who are known entities–are the candidates who get the top positions.

So, if you are a company, be sure you’ve defined your company’s culture–particularly your core culture. Use an organization-​​wide process to define the organization’s Purpose and Philosophy: the central and distinguishing attributes that are the character of the organization and the cause that it has served over the years. You must also know the Priorities of the organization so that you can screen to ensure that candidates naturally practice the values needed to achieve your goals.

By understanding the candidate and an organization’s core culture, you can screen for culture fit. A successful organization hires people who want to live the culture effortlessly.

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When the H-​​P leader does not live the culture, he must go

by Sheila Margolis on August 7, 2010

Organizational culture is an important thing. It’s the standards guiding all behavior in the organization–leaders and employees alike. So when you have a culture of uncompromising integrity, respect, and trust and your top leader–the CEO–demonstrates behaviors that are in conflict with those core values, what do you do? The answer is simple if your culture matters. The CEO must leave. And that’s what happened at H-​​P.

If you read the H-​​P Way, a key tenet of the culture is:  “We conduct our business with uncompromising integrity.” It is explained this way:

We expect HP people to be open and honest in their dealings to earn the trust and loyalty of others. People at every level are expected to adhere to the highest standards of business ethics and must understand that anything less is unacceptable. As a practical matter, ethical conduct cannot be assured by written HP policies and codes; it must be an integral part of the organization, a deeply ingrained tradition that is passed from one generation of employees to another.

In the Five Ps model, the P of “Projections” refers to the images that an organization projects to the public and to the employees, as well. Those images are often influenced by marketing, PR and advertising, but they are also influenced by things like the company name, its logo and symbols, and even the image of the headquarters, offices and stores, and the company’s leader. These images must be aligned with the culture of the organization. Lack of alignment produces serious problems for the company–the public and the employees no longer believe those espoused values matter. How can the leader of a set of values not practice the values that he says are most important?

Leadership matters when it comes to organizational strategy and leadership matters when it comes to organizational culture. When the leader lives the values and talks about them each day, then everyone inside and outside the organization believes they are real. And that’s what it takes for a strong culture–a vital asset for any organization.

And when that leader no longer represents those core values, for the sake of the health of the organization, the leader must leave. Of course, selecting the next leader becomes a challenge, especially when the organization has had a history of selection issues as the WSJ labels as the H-​​P Curse.

An insider is usually the better choice if you seek to sustain the distinctive and enduring Philosophy of the organization–a vital part of the Core Culture. Insiders usually get it because they’ve been living it–assuming the culture is aligned and practiced. Outsiders need to be selected based on whether they have demonstrated leadership practices that are consistent with the company’s culture. The wrong selection can damage a culture.

Culture matters and leadership matters. They go hand-​​in-​​hand.

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Nokia searching for new CEO to bring change

by Sheila Margolis on July 20, 2010

According to the WSJ, Nokia is searching for a new CEO to revive an organization that sells lots of cell phones but has been unable to compete in the high-​​end smartphone market. The WSJ says, “The company’s failure to get back in the race has taken a toll.” Selling in the mainly lower-​​end market limits profit margins. So what does the company do to push change…they search for a new CEO.

Leadership is a prime driver of change, and top leadership is the primary influencer of an organization’s culture. Thus, several things must be decided before looking for a new leader.

  • First, decide what is working with the culture and what needs to be changed. Is a new strategy with corresponding values what leadership must advocate or is the problem deeper? A clear assessment of the Core Culture and particularly the Purpose and distinctive and enduring Philosophy of Nokia must be assessed. What are they and can the organization survive sustaining that Purpose and those distinctive organizing principles that are the character of the company. Is a character change needed or a strategy change? Hopefully, it’s just a strategy change because the former requires a much more complex process of transformation.
  • Next, if the change is just a strategy change, be sure the new leader personally advocates and believes in the Purpose and Philosophy. If that leader sees the organization in a new way, changes may be made that were not intended.

Selecting new leadership is a delicate process. But first understand what must be sustained and what needs to alter. Then, choose the leader that will take the organization in the right direction rather than destroying those attributes that matter most to employees and the customers who identify with it.

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Is your performance management system working?

by Sheila Margolis on May 26, 2010

Is your performance management system damaging employee performance? Do some managers put off their annual appraisal meetings because they dread the process as much as the employee? If that’s the case, let’s review a few of the basics of performance management to guide you in the process.

  • Employees must participate in the creation of their performance expectations. If employees do not help create the standards by which they are judged, they will not feel ownership of those standards. And ownership produces the commitment and drive you need for organizational success. These performance expectations become the “how” and the “what” to guide the employee.
  • Performance expectations should include desired behaviors linked to the culture of the organization. These behaviors are the actions the individual must do that align with the culture of the organization. Each employee must live the core culture principles each day in a variety of ways. These standards are not limited to a particular job; instead, they are across-​​the-​​board standards that everyone must adhere to and thus ensure that the culture is expressed continuously. For example, if your organization is all about “attention to detail,” then each employee is guided by that standard.
  • Performance expectations should include desired behaviors linked to the job. With each job, there may be unique behaviors that are required. These behaviors must be incorporated in the standards for the employee.
  • Performance expectations should include expected outcomes. Employees must have defined outcomes to achieve that link to the organization’s goals. These individual goals give the employee a big picture view of the organization’s strategy. By understanding the individual outcomes that will contribute to the organization’s goals, each employee can be a key player in moving the organization toward success.
  • Ongoing feedback is the key to improved performance. Highly engaged employees get daily, weekly, or monthly feedback–not just an annual performance review. But there’s one problem with feedback: it’s not so easy to do it right. That’s why so many managers avoid it. Feedback must be timely–provided as close as possible to the occurrence of the behavior. That’s a feature that annual reviews can’t offer. Feedback must also be specific–it must describe the behavior in exact terms. Feedback must be genuine–using personal pronouns such as “I.” And feedback must be given in a supportive and positive environment. Feedback can be an informal, ongoing exchange.
  • The performance review session offers an opportunity to plan for the employee’s development. An employee’s performance–in relation to the behavioral standards and expected outcomes–offers a good opportunity to discuss development needs. Use the performance review as a time to identify areas for development and a plan for obtaining that development.
  • Does the employee get a score? This is a key question to answer because “the score” is what contributes to the threatening nature of the process. The score is what can make employees get defensive. The score is what causes discussion to be distracted from the real intent of the process–to improve performance. If your purpose is to have a rating to guide pay, rewards, and reduction in force, then you will need a number. But be clear: the process then becomes less of a development tool. Some organizations have pay and promotion discussions as a separate activity. That allows the review to be solely a development tool and more open discussion usually occurs when there is less concern that pay will be impacted.
  • Managers must be trained in the performance management process. Giving feedback and  consistently using the scales for measuring one’s performance are essential skills. Don’t assume all managers have a consistent understanding of the standards and the scales used or the necessary skills for giving effective feedback. Discussion and training are often required for the process to be effective and to do what it’s designed to do–improve performance.

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Are you managing smarter?

by Sheila Margolis on May 26, 2010

Are you thinking about doing more cost-​​cutting? If so, stop for a moment if you are considering an across-​​the-​​board reduction in spending. Instead, manage smarter by first considering two key questions:

  • What can your organization be the best at?
  • What capabilities enable you to be best-​​in-​​class?

The answers to these two questions will be the guide in how you move forward. The challenge is to allocate resources to enhance the capabilities that make you best-​​in-​​class and not get distracted by spending time, energy, and money in developing capabilities that really don’t contribute to your distinction. Once you have defined what the organization can do “the best,” be sure everyone in the organization has that shared view. Then, each day, employees will focus on enhancing the organization’s critical capabilities.

Read an interesting article, “The Coherence Premium” in the Harvard Business Review, June 2010 issue. Paul Leinwand and Cesare Mainardi provide an excellent discussion of these principles. As the authors state, “Sustainable, superior returns accrue to companies that focus on what they do best.”

Success can be achieved by aligning your core culture–guiding the “why” and the “how” of the organization–with your distinctive internal capabilities that make you best-​​in-​​class, and the right market position.

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Do employees have the big picture?

by Sheila Margolis on January 26, 2010

Prosper Using the “Why,” the “How,” and the “What”

How would you describe the people in your organization?

  • Do employees genuinely care about the organization? Do they feel a connection to its contribution and its unique character?
  • Do valued employees want to continue working there? Do they identify with the organization? Do they feel invested in its future?
  • Do employees regularly put forth extra effort to help the company succeed? Are they adaptive? Focused? Persistent in their efforts? Are they willing to take on added tasks when they see the need?

Work today is different from the past.

If this sounds too idealistic, maybe it’s because organizations of the past have used a different model for work. In an environment of command and control, the focus was on following rules, with little place for personal initiative. But today, that model cannot thrive in our global, highly competitive, constantly changing, and transparent world. Successful organizations today are characterized by high energy, a sense of urgency, focus, passion, and perseverance.

So how do you help your organization generate the enthusiasm that propels it toward prosperity? The key is to share a—bigger picture—view of work to guide people as they create the success each organization seeks. [Continue reading…]

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