Cultural Change That Sticks

When a major change initiative runs aground, leaders often blame their company's culture for pushing it off course. They try to forge ahead by overhauling the culture--a tactic that tends to fizzle, fail, or backfire. Most cultures are too well entrenched to be jettisoned. The secret is to stop fighting your culture--and to work with and within it, until it evolves in the right direction. Today's best-performing companies, such as Southwest Airlines, Apple, and the Four Seasons, understand this, say the authors, three consultants from Booz & Company. These organizations follow five principles for making the most of their cultures: 1) Match strategy to culture. Culture trumps strategy every time, no matter how brilliant the plan, so the two need to be in alignment. 2) Focus on a few critical shifts in behavior. Wholesale change is hard; choose your battles wisely. 3) Honor the strengths of the existing culture. Every culture is the product of good intentions and has strengths; put them to use. 4) Integrate formal and informal interventions. Don't just implement new rules and processes; identify "influencers" who can bring other employees along. 5) Measure and monitor cultural evolution. Otherwise you can't identify backsliding or correct course. When the leaders of Aetna applied these rules while implementing a new strategy in the early 2000s, they reinvigorated the company's ailing culture and restored employee pride. That shift was reflected in the business results, as Aetna went from a $300 million loss to a $1.7 billion gain.

• Organizational change
• Innovation
• Management styles
• Business communication
• Employee training
• Organizational learning
• Organizational behavior
• Corporate strategy
• Entrepreneurship
• Management philosophy
• Motivating people
• Change management
• Morale
• Organizational culture