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How to Change Corporate Culture (with three examples)
Explore the art of reshaping corporate culture with insightful examples from industry giants: IBM, Netflix and Zappos. Read our article to understand the powerful process of culture change and the pivotal role it plays in a company's success.
In an ever-evolving business landscape, changing company culture may be crucial in adapting to emerging trends and staying competitive. It doesn’t automatically mean that a company culture is toxic — just in need of a refresh. Unfortunately, culture change is one of the most challenging tasks for many organizational leaders.
A healthy or unhealthy corporate culture can make or break a company. Those with a distinctive culture were reportedly 80% more likely to see an increase in employee satisfaction and 89% more likely to see an increase in customer satisfaction. That’s not all — a distinctive culture also showed a 48% more likely increase in revenue.
Changing organizational culture can unlock the full potential of any business. Keep reading to see how you can change your organizational culture and examples of companies that successfully changed theirs.
Strategies for Changing Organizational Culture
- Have a Clear Vision: Leaders should articulate clear and compelling reasons why you need a culture change. They should also communicate a shared sense of purpose, any specific desired outcomes and offer guiding principles to inspire staff.
- Engage Your Team: Employees should be encouraged to share their input in shaping the new culture. Open communication and feedback will create a sense of ownership and inclusivity.
- Assess and Modify Structures: Re-evaluate existing structures and processes and decide which aspects you want to retain. Analyze them carefully and determine how they'll merge with the new values. This may include restructuring teams or redesigning the performance evaluation system to align with the desired culture.
- Lead by Example: Culture change starts at the top. Leaders must manifest the desired cultural traits and exhibit behaviors that align with the new values. Your commitment to cultural transformation will inspire your team to embrace change and become advocates for the proposed changes.
- Measure Your Efforts: To demonstrate the effectiveness of your efforts, implement employee surveys and analyze gaps between desired values and actual behavior.
How Long Does It Take to Change a Company Culture?
Changing a culture can take time, spanning from months to several years. The duration varies based on different factors, including the extent of change required, the size of the organization, the level of employee engagement, and the resources needed to implement change.
However, leaders must recognize that culture change is an ongoing process requiring stakeholders' commitment and effort. Small cultural shifts will successfully occur within a few months, while significant cultural change may take several years to embed fully.
Examples of Successful Organizational Culture Change
Here are some notable real-world cultural change examples of companies that successfully changed their culture.
In the 1990s, the world's largest computer company, IBM, faced major financial turmoil and an overwhelming bureaucratic culture. Under the leadership of Lou Gerstner, IBM shifted its focus from the original hierarchical structure to a more innovative and customer-centric approach.
The shift from hardware to software services helped IBM embrace emerging technologies like the internet and e-commerce, thus breaking away from its traditional image. Through these changes, IBM cultivated a collaborative and creative culture with a more entrepreneurial mindset.
For over two decades, Netflix was known for its DVD-by-mail rental services. Before becoming the successful streaming giant, Netflix embraced a culture of innovation and risk-taking by disrupting the former video rental industry and introducing a subscription-based model.
They achieved this through a data-driven approach, using algorithms for personalized recommendations that enhanced user experience. Netflix created a flexible work environment by empowering employees to make decisions and encouraging creativity and adaptability. Through this cultural shift, Netflix revolutionized how we consume media and became a powerhouse in the streaming market.
Zappos boasts an outstanding customer-centric culture with employee satisfaction as its core values of success. Zappos fostered a sense of ownership and autonomy within their employees which enabled and inspired them to put their all into gaining customer satisfaction and creating a loyal customer base.
Changing company culture is a complex but worthwhile endeavor for organizations seeking growth and success. It's a transformative journey that requires a clear vision, involvement of all employees, assessment and modification of structures, leading by example, and strategies to measure your efforts. While the timeline may vary depending on various factors, changing corporate culture requires commitment, consistency and effective leadership.
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