Culture is like an iceberg. The part that can be seen above the waves reflects the isolated behaviors and outcomes that can surprise and sometimes frustrate incoming executives. The bulk of it, though, the submerged part, comprises the “shared beliefs and assumptions” that are often shaped over generations and can sometimes punch a hole through titanic corporate initiatives.
That is why changing organizational culture can be both a priority and a challenge. It is also why many executives find it difficult to precisely articulate and deal with culture. Indeed, Deloitte’s Global Human Capital Trends 2016 report,1 based on a survey of more than 7,000 business and human resources leaders, found that 82 percent of respondents view “culture as a potential competitive advantage,” while only 28 percent believe they “understand their culture well,” and 19 percent believe their organization has the “right culture.”
Little wonder that not systematically understanding culture and addressing change when needed can undermine leadership success and corporate performance. In this issue of CFO Insights, we outline some straightforward ways in which executives in general and incoming executives, in particular, can diagnose the prevailing culture and, when needed, ways in which they can work across the C-suite to drive cultural change.
Going back to the iceberg metaphor, what we see above the surface are often the artifacts and consequences of culture rather that the values, beliefs, and assumptions that actually drive the culture—and the behaviors and outcomes we observe.
Changing culture thus requires change at the beliefs level, which is often substantially more difficult than changing business processes or information systems. To complicate matters, there may be an overall company culture and sub-cultures across groups that can sometimes be in conflict. While CEOs have the authority to lead cultural change across a company, typically other C-suite executives, including CFOs, can only be supportive of a CEO’s companywide culture change efforts, or they are limited in scope to drive belief changes in their specific sub-organization. Yet, every C-suite executive should be able to diagnose dysfunctional cultural attributes and get at the underlying beliefs to help CEOs drive companywide culture change.