How to ensure successful culture change. successful culture changes require aligned and visible management

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1 How to ensure successful culture change successful culture changes require aligned and visible management

2 Successful culture changes require aligned and visible management as well as empowerment of the employees, plenty of time and resources, and a good deal of courage from the entire organisation. In particular, this is required from top management, who must release the reigns and share a large part of the responsibility for the process with the employees that they can make it their own. This is what the energy company E.ON Denmark experienced, based on an extensive strategy and cultural project that, within a year, turned a negative organisational culture into an atmosphere characterised by job enthusiasm, motivation, and cooperation. Here, you can read about E.ON s experience and Summit Consulting's sound advice on successful culture change processes. By Annemette Schultz Jørgensen, freelance journalist. Previously, gossip, silo mentality, and resistance to change were all part of the culture at the energy company E.ON. This resulted in a struggle to keep the business profitable, and both job and customer satisfaction measurements were at rock bottom. This led management to implement an extensive strategic and cultural process, which has since resulted in turnaround in employee satisfaction, a significant improvement in customer satisfaction, and has spurred the business into rapid development. Because of this, the Danish subsidiary is now seen as a role model and exemplary ideal in the entire global E.ON group for how to successfully implement a culture change project. When you look at the organisation today, you can hardly recognise it. Before, everyone was more unapproachable, there was a negative attitude to change, and cooperation across the organisation was not a priority. Today, the company is buzzing with talk and cooperation, and our latest Voice measurement from TNS Gallup placed us at the very top of the group for involvement, adaptability, and innovation," says Tore Harritshøj, CEO of the energy company E.ON Denmark. New strategy required a new culture Following a consolidation period involving divestments and layoffs, E.ON Denmark needed new business goals and a new strategy to establish a direction for the company. The layoffs had left the organisation and the employees in a state of insecurity. There was a sense of pressure, and employee and customer satisfaction levels were at an all-time low. Since new goals would involve an entirely new approach towards customer focus and requirement for new ways of working, management decided to combine the strategic process with a culture project. The energy sector has been in rapid development these past few years and has created many new market opportunities. We wanted to take advantage of this. However, at the same time, we could see that this would require a move from the well-established monopoly with loyal and long-lasting customers into new markets where the customers had to choose us based on our offerings and services. This would require a change in the entire organisation, with new ways of working and a total change in our culture. For this reason, we decided to combine the strategic process with a cultural project, which thereby became the determining factor that was supposed to help us reach the new strategic goals," says Harritshøj. Top management designed the project Summit Consulting, who was already involved as external advisor in the strategic process, was also hired for the culture project. Nonetheless, it was of critical importance to E.ON's top management and for Tore Harritshøj that, as senior manager, he should be part of designing the project.

3 It has been incredibly important to have external consultants like Summit Consulting on board acting as advisers and sparring partners. However, I felt from the outset that it was of critical importance that I would be the one to design the process and assume leadership. It adds credibility when the senior manager does not use consultants as a shield but rather handles communication himself and takes the lead in such an extensive process," he says. Empowerment through cultural ambassadors Furthermore, it was also important to Tore Harritshøj, and to the rest of the management group, to involve the employees as closely as possible in the culture project. It was decided to appoint a number of cultural ambassadors among the employees and managers who would then act as the driving force for defining which specific projects would be included in the change process and who would assume responsibility for implementing them. The employees are the heart of the organisation and culture. If the culture is to change, they are the ones who must lead us there. Therefore, we knew that it was of vital importance to have the employees on board as early as possible, but we were also aware that we could not get everyone to assume ownership right away. So, we started by gathering a small group of employees. For better or worse, they are the culture bearers of the organisation, and people listen to them. If we could get them to take ownership and to act as frontrunners, we would be more successful in getting the rest to follow more quickly. It succeeded, and it was without question a determining factor in the process. Together with the top management, the 15 new cultural ambassadors defined the content of the cultural themes that would characterise E.ON Denmark s new DNA and would be the focal point of the cultural changes. Among other things, they wanted to focus on the customer, cooperation, innovation, and on being modern, professional, open, effective, and dynamic. The ambassadors organised themselves according to the different themes and then assumed responsibility for engaging the rest of the employees and involving them in specific projects within each theme. Profiling effects and positive results In order to render visible the elements that should be included in the new culture and, in particular, the elements that should not be included, a so-called bonfire event was held along the way. The entire organisation was gathered for this event, and all the employees had the opportunity to, quite literally, burn the elements of the old culture that they wanted to get rid of. Some people burned a copy of meeting regulations that had never really been adhered to. Others threw in piles of paper to symbolise a new and digital environment. Others threw in a synthetic rug to show that they wanted to get rid of the poor indoor climate and work environment. In order to quickly render visible the results of the culture project, a set of quick-wins were defined, which were projects that could generate an effect quickly. For example, an open internal blog was created to increase information sharing, which was one of the new goals. A new initiative was started where all the successes in the organisation were celebrated once a month, and a clean desk policy was implemented to signal the beginning of a new digital work environment, modern facilities, and a generally more professional and effective organisation.

4 And in parallel with the process, it was decided to let the organisation start over from a physical perspective and move into new offices. I was sure that the chances of succeeding with the cultural changes would increase if we also changed the way we physically interacted with each other every day. Therefore, we found a new domicile in Frederiksberg where we set up a completely new workplace with help from Signal Arkitekter. A place that was best suited for living up to our new goals for stronger cooperation, increased knowledge sharing, good workplace relationships, and, last but not least, our desire to be more dynamic, modern, and customer-oriented, says Tore Harritshøj. Today, E.ON Denmark is a model example in the global group 12 months later, the new strategy was well on the way to being realised through 3 new business areas, and the new culture is alive on an everyday basis. The results are clearly demonstrated in E.ON s latest Voice results. Here, 81% of the employees claim to be optimally motivated, and adaptability and satisfaction also rank at the top. This is a result that placed E.ON Denmark 10% above the rest of the global group and the industry average. For the same reason, the rest of the group, totalling 75,000 employees, currently regard the company s project as a prime example of how to implement cultural changes successfully. 7 pieces of advice for culture change Top management must be aligned, committed, and take the lead in the change The employees must see the point and the need for the change also on an individual level: what s in it for me? The employees must be given responsibility, and they must play an active and important role in the process. So, be willing to relinquish control and to delegate responsibility Appoint key employees as ambassadors who can help you generate support throughout the entire organisation Profile the results and progress of the change process and new culture, quickly and regularly You cannot always convert every employee. Use your energy on the 90% you can reach instead of focusing on the 10% you cannot Be ready for the change to take time and resources if it is to be permanent and produce long-lasting results Cultural changes start with top senior management It is difficult to summarise briefly which exact elements led to the success of this process. Because there are many. First, we had a clear sense of urgency. We had to change, and we made sure everyone understood that. We also knew that we had to generate a high degree of employee involvement, but at the same time, we could not win everyone over right away. Therefore, we began with the ambassadors and that was of critical importance. One final factor, which is a personal one for me, was experiencing the importance of daring to relinquish control of the process. I knew that the employees had to be given responsibility, but it also put me under pressure because I could not be certain that they would go in the same direction as me. Relinquishing control took some courage, but it was also incredibly important. This is because the employees turned out to be very involved and conscientious when they were given joint responsibility, says Tore Harritshøj, who is backed up by Summit Consulting.

5 The change process is hard work. It requires time, commitment, and persistence from the management, and it also requires a high degree of empowerment of the employees, says Karsten Søderberg, Managing Partner and CEO in Summit Consulting. These are all aspects that succeeded in this process, which is why I believe it was so successful. Many top managers underestimate how much work cultural change requires from them personally. Some bring in a consultancy company and hope that they can manage the process alone, and others forget that they themselves are the most important culture bearers and role models and therefore also have to change personally if they want the rest of the organisation to follow. It takes courage, and this is what the top management showed in this case, concludes Karsten Søderberg.