"Culture eats Strategy for Breakfast

Transcription

1 "Culture eats Strategy for Breakfast Strategies for Change based on Culture Quote attributed to management guru Peter Drucker All rights reserved. Copyright

2 Why culture? Culture is a very strong driver of behavior of individuals within your organization and having the wrong culture may conflict with your strategic goals. Key is to have the appropriate culture which is aligned with your companies strategic goal and objectives. agile42 the agile coaching company All rights reserved. Copyright

3 shift the balance Manage Results Actions Culture Lead Beliefs coaching is an ongoing long term investment Experiences The Results Pyramid is copyright of Partners in Leadership LLC agile42 the agile coaching company All rights reserved. Copyright

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5 Key findings - Important but neglected Culture is ranked 3rd in terms of importance, behind strategy and financial performance Only 20% or 1 in 5 of the 450 responding C-Level directors reported spending time to manage and improve it Some 62% felt that they were primarily responsible for setting culture from the top However, 63% did not consider culture as part of their risk assessment Board Leadership in Corporate Culture: European Report Research Report by Board Agenda & Mazars in association with INSEAD agile42 the agile coaching company All rights reserved. Copyright

6 Key findings - Culture & Strategy Misalignment When they do discuss culture, the Nr. 1 focus is on understanding the actual culture and 2nd the link between culture and strategy Half say there are either significant gaps between strategy and culture or they have not spent time considering alignment of the two. A third are not confident they have the right information and are unclear on alignment between the desired culture and that which actually exists in the business Board Leadership in Corporate Culture: European Report Research Report by Board Agenda & Mazars in association with INSEAD agile42 the agile coaching company All rights reserved. Copyright

7 Key findings - Don t know how measure Only 1/4 of the boards said that they undertake an audit of the their culture The remaining 3/4 rely upon sources such as employee surveys, risk events such as rule breaches, HR issues and the monitoring of compliance Employees are seen as major targets for cultural change programs: enhance employee motivation and productivity was cited as the Nr. 1 reason for a change program. Board Leadership in Corporate Culture: European Report Research Report by Board Agenda & Mazars in association with INSEAD agile42 the agile coaching company All rights reserved. Copyright

8 Summary Overall, the findings indicate that, although awareness of the importance of corporate culture to business success is recognised, boards have yet to find a way to discuss corporate culture in a meaningful way. Board Leadership in Corporate Culture: European Report Research Report by Board Agenda & Mazars in association with INSEAD agile42 the agile coaching company All rights reserved. Copyright

9 What is culture? Every organization has a culture, regardless of whether you want it or not. agile42 the agile coaching company All rights reserved. Copyright

10 This is how we do things around here Culture is the set of behaviors that have been established and accepted within an organization agile42 the agile coaching company All rights reserved. Copyright

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12 Make culture explicit Organizational culture exists and manifests itself in the form of behaviors and activities. Make it explicit to allow for better alignment and context creation it's difficult to change what cannot be seen. agile42 the agile coaching company All rights reserved. Copyright

13 Organizational Culture Profile (CVF) Flexibility & Discretion Internal focus & Integration Culture Type: Clan Orientation: Collaborative Leader Type: Facilitator, Mentor, Team Builder Value Drivers: Commitment, Communication, Development Theory of Effectiveness: Human development and participation produce effectiveness Culture Type: Hierarchy Orientation: Controlling Leader Type: Coordinator, Monitor, Organizer Value Drivers: Efficiency, Timeless, Consistency and Uniformity Theory of Effectiveness: Control and efficiency with capable processes produce effectiveness Culture Type: Adhocracy Orientation: Creative Leader Type: Innovator, Entrepreneur, Visionary Value Drivers: Innovative outputs, Transformation, Agility Theory of Effectiveness: Innovativeness, vision, and new resources produce effectiveness Culture Type: Market Orientation: Competing Leader Type: Hard driver, Competitor, Producer Value Drivers: Market share, Goal achievement, Profitability Theory of Effectiveness: Aggressively competing, customer focus produce effectiveness External focus & Differentiation Stability & Control agile42 the agile coaching company All rights reserved. Copyright

14 60 Most of the organization today have a Clan strong Hierarchy oriented profile 40 Agile Values & Ad-hocracy 50 They struggle to introduce a more agile 30 Principles 40 and lean approach to work, because the hierarchical culture is not supportive of agile values and principles Hierarchy Market agile42 the agile coaching company All rights reserved. Copyright

15 60 Most of the organization today have a Clan strong Hierarchy oriented profile 40 Ad-hocracy 50 They struggle to introduce a more agile and lean approach to work, because the hierarchical culture is not supportive of agile values and principles To create the right context to move toward a more agile and lean culture, we 10 need to transition toward Clan or Ad Hocracy Hierarchy Market agile42 the agile coaching company All rights reserved. Copyright

16 If you can make culture explicit, you can agree where you stand and where you want to go What types of behaviors associated with the specific culture do we want more of and which do we want less of in order to move closer to our desired culture? agile42 the agile coaching company All rights reserved. Copyright

17 There are two ways to encourage specific behaviors within an organization: 1. Story telling and role-modeling (e.g: empathy and tradition, walk the talk, common jargon) 3. Ritualization (e.g: Scrum events, Ritual Dissent, Open Space) agile42 the agile coaching company All rights reserved. Copyright

18 Leader Type Clan Ad-hocracy Quality Strategies Clan Ad-hocracy OrgScan Different dimensions contributing to cultural development can be compared It is possible to clearly see the overlapping areas and understand Hierarchy Market Hierarchy Market how far is the overall culture from being coherent Theory of Effectiveness Value Drivers It is easier to find adjacent possibles Clan Ad-hocracy Clan Ad-hocracy toward which to shift the culture to facilitate coherence, before embracing a transition towards a new profile It is possible to compare different areas of an organization including currently running experiments Hierarchy Market Hierarchy Market agile42 the agile coaching company All rights reserved. Copyright

19 Assessment agile42 the agile coaching company All rights reserved. Copyright

20 Leader Type Quality Strategies Company A Clan Ad-hocracy Clan Ad-hocracy Every dot represents a decision, selfsubmitted and self-signified by an employee Hierarchy Market Hierarchy Market Leaders are Clannish but the Quality Theory of Effectiveness Value Drivers Strategies or Orientation are Market- Clan Ad-hocracy Clan Ad-hocracy driven Hierarchy Market Hierarchy Market agile42 the agile coaching company All rights reserved. Copyright

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22 Where 60% of respondents were with the company for les The approach taken to decision making was quite evenly balanced between Rational analysis, Decisive action and Collaborative consensus this group. While 14,5% of the respondents were there fo building. No strong patterns were found that Rational analysis is preferred in any particular circumstance. Collaborative consensus building is came from them; therefore a higher likelihood of negative more likely to be important when decisions are strongly influenced by Peers, and in Operational rather than Strategic decisions (see next slide) Operational/Tactical, but two thirds of these were in the Rare and problematic or Familiar but difficult categories. This is consistent with a concentration in the Clan quadrant of the culture profile wrt Leader type, and with Agile principles Flat o rg stru Ra c pid de ture cision s Decision was made... Decision was made by... Leader Type I don t know Clan Ad-hocracy The more problematic the situation was, the more likely th Not sure Factors influencing Emotion T5: Decision needed... TimeTaken Tenure Rational analysis Took forever Role 100 MadeBy Problematic 20 Everyone Frequency Operational Strategic r e d a e L n e e w t e b y he situation was, the more likely the stories were to be negative ker c n e a t s i m s n n o i s Co i c e D & Compromises e p y t ents were with the company for less than 6 months, 70% of the negative stories came from % of the respondents were there for longer than 24 months, 23,5% of the negative stories The Team ore a higher likelihood of negative stories from recent employees or old hands MadeBy g n o l d n a s n o i s i c t Slow de c a p m i e v i t a g e n d a h e r tenu 20 intprinciples DecisiveAction Within the hour theoryeffectivenessx be meaningful qualitystrategiesx Right away Negative count Rare 20 Decisive action 0 10 Emotion 20wrt compromises Observations Collaborative consensus building leadertypex Critical made were balanced across the whole that20t6 had NA s 40 (25%), which might 0 triad. Note count Neutral Importance of variable toward Emotional tone Positive Relatively few Not patterns were found in this triad. Quite reasonably, decisions that were made right way tended to sure 10 than compromise on Time more than either Resources or Politics. Team Leaders tended to compromise more on Politics Team Members did, and Rare decisions involved more compromises on Politics than more frequent ones (graph not shown) The Team 14 Me count 50 c i t a m e l b d Pro e n r u t s n o i s i e v dec i t a g e n out T6: Compromises were made on... How problematic the situation was Politics Compromise on Politics Resources Problematic 40 Politics Me Manager/Leader Time Resources Within the day Market Everyone RationalAnalysis 80 Hierarchy 60 0 ng Emotion Not sure Within the week 10 Decision made me feel... Familiar theoryeffectivenessy Variable Not sure 60 TimeTaken MadeBy StrategicOps 40 higher likelihood of being reported negatively: while 31,5% of the reports were of decisions of the negative stories were taken right away. Decisions taken within a day made up 29% of Manager/Leader hile being only 19% overall of the stories. 80 StrategicOps Within the month 60 d to stories being negative or positive? h s r e g Mana s c i t i l o p e l and Negative e of variable toward Emotional tone Neutral Positive Not sure Team leader 60 Team member Role Emotion Compromises: Decisions right away Resources agile42 the agile coaching company All rights reserved. Copyright

23 Company B Negative decisions strongly linked to Hierarchy and Market cultures Positive decisions strongly linked to Clan culture (and Ad-hocracy) agile42 the agile coaching company All rights reserved. Copyright

24 Decision was made by... Clan Flexibility & discretion Ad-hocracy T Collaborative Creative Not sure MadeBy A group Advisor/Expert Majority of decisions made by managers... Internally focussed Externally focussed Innovative company? More Ad-hocracy Manager/Leader The Team Hierarchy Market Controlling Stability & control Competing Me count... but influenced by colleagues agile42 the agile coaching company All rights reserved. Copyright

25 Culture, Market/Product Maturity and Context Complex (Emergent) Complex (Emergent Practices) Complicated (Good Practices) Obvious Chaotic (Novel Practices) Chasm (Best Practices) Early Adopters Early Majority Late Majority Laggards t Culture Methods Rapid Prototyping/XP Scrum/ XP Scrum/ Kanban Kanban agile42 the agile coaching company All rights reserved. Copyright

26 Validate changes in small increments Once explicit, start guiding the culture towards a more appropriate state. It should support the values and behaviors that are important for your strategic goals and for the people within the organization. Because change is difficult and confronting, validate changes with small safe-to-fail experiments executed at regular intervals. Gradually incorporate validated learnings. This reduces resistance and minimizes the waste of two coexisting systems. agile42 the agile coaching company All rights reserved. Copyright

27 The traditional approach to change management Design Documentation Rollout Fix Issues > 9-10 months t focused on standardization, before stabilization agile42 the agile coaching company All rights reserved. Copyright

28 The agile approach to change management Experimentations allows for better approaches to emerge Design Coach Design Coach Rollout Doc Rollout Doc Rollout Doc Rollout Doc Rollout Doc 12 weeks t focused on stabilization with emergent standardization agile42 the agile coaching company All rights reserved. Copyright

29 Agile Strategy Map Necessary Condition (NC): what is needed in order to fulfill the Success Factor Define the Goal PSF NC Goal we want to achieve Possible Success Factor (PSF) represents a hypothesis about a key factor that would enable us to achieve the Goal agile42 the agile coaching company All rights reserved. Copyright

30 Strategy Map from March 2014 The Goal for 2015 has been established The Transition Team identified at least 7 PSFs that would provide a powerful leverage to achieve the final Goal agile42 the agile coaching company All rights reserved. Copyright

31 Strategy Map June 2014 Break out groups worked on detailing the various PSFs into actionable experiments to validate the hypothesis for organizational improvement Safe-To-Fail Experiments agile42 the agile coaching company All rights reserved. Copyright

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33 Strategy Map from Mai > strategic alignment within project with multiple agile teams Tactical board to the Strategy Map -> created for alignment on tactical actions related to each Success Factor agile42 the agile coaching company All rights reserved. Copyright

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37 Leader Type Quality Strategies Dynamic data Clan Ad-hocracy Clan Ad-hocracy Take a baseline Run the scan continuously Hierarchy Market Hierarchy Market Track your pilot/experiment teams Theory of Effectiveness Value Drivers Monitor what happens Clan Ad-hocracy Clan Ad-hocracy Are we moving in the right direction? Compared to rest of the company? What can we now amplify or rollout? Hierarchy Market Hierarchy Market agile42 the agile coaching company All rights reserved. Copyright

38 Gregory Keegan Agile Coach agile42 the agile coaching company All rights reserved. Copyright

39 Who we are Started in 2007 as an international group of passionate people Focussed since then in making every workplace more liveable and engaging Completely self-managed, no department, no fixed roles, no HR, no Controlling Very high qualified people (highest amount of CECs, CTCs, CSTs and CAL Educators in a single company worldwide) agile42 the agile coaching company All rights reserved. Copyright

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41 Experience makes the difference. We recognize that your organization and culture are unique, which implies a unique implementation of any new methods like Scrum or Kanban. Our effective combination of leadership coaching, knowledge transfer, team training, coaching on the job and practical tools is the basis for your success, as it has been for many other international customers. agile42 has helped enterprises such as Nokia, Sony, ABB Group, Ericsson, Avea and Siemens successfully and sustainably transition to agile. agile42 also helped startups to grow faster and healthier, good examples are: Fyber, Babbel and Sipgate. agile42 the agile coaching company All rights reserved. Copyright

42 Organizational resilience: is the capability of an organization to react to unknown challenges and volatility by co- evolving with the change into a new and improved stable state. Growing autonomy: means investing in growing people to enable them to act more autonomously and consciously within and for the organization. Good as well as fast decisions need to be made constantly and autonomously within the organization to allow fast feedback and reaction time. Nurturing an inter-dependent culture: requires enabling communication between different groups and people within the organization. Increasing transparency and encouraging development of interpersonal relationship outside of team and group boundaries to accelerate reaction times. Cultural coherence deepens and within it the understanding about how to act in everyone s interest. agile42 the agile coaching company All rights reserved. Copyright

43 Don t copy the tools, copy the principles. - Dr. W. Edwards Deming, 1972 agile42 the agile coaching company All rights reserved. Copyright

44 Thank you! agile42 the agile coaching company All rights reserved. Copyright

45 Copyrights notice All material produced in this presentation is protected by the Creative Common License 4.0 (by-nc-sa). The brands and logos of agile42, Enterprise Transition Framework ETF ( Team Coaching Framework TCF ( and Agile Strategy Map ( are Copy Rights and Trademarks of agile42, and agile42 International and can t be reused without written authorization. The OrgScan has been jointly developed by Cognitive Edge and agile42 International, SenseMaker is a registered trademark of Cognitive Edge. agile42 the agile coaching company All rights reserved. Copyright