How Long Does It Take To Change A Business-Culture?

By Vic Downing

© Vic Downing March 2007

The culture of a business will change at the rate the behaviors of business leaders change. (There is no research data on the rate of business-culture change.)

When we say, “business-culture” we mean, “how things actually work here.” The technical term for this is the “norms” of the business. For example, a particular bank may have a methodical, deliberate, “steady” culture, while an Internet-based company may have a make-it-happen-now, gun-slinger, innovative, “exciting” culture. The bank-culture undertakes risks, builds alliances with other enterprises, advertises, invests, sues, hires, fires, promotes, and rewards people differently than does the Internet-company… these ways-we-do-business are the “norms” of each business.

The leaders of the business determine the norms of a business. Leaders (consciously or unconsciously) choose their behaviors—and therefore the behaviors of everyone else in the company—in response to how they perceive market conditions, what they value personally, how they have seen leaders they admire do business, et cetera. Therefore, what happens in a particular business is a reflection of what leaders want (or have wanted) to see happen in that business; this is why two businesses that offer the same service to the same customer can have very different cultures.

The culture of a business will change at the rate the behaviors of business leaders change.

Changing the culture of a business can happen suddenly or “take forever.” If the business replaces senior leadership (beginning with the most senior position), and/or if senior leadership immediately changes how it makes decisions (i.e., who is involved and the criteria for an acceptable decision), changes the measures of business success, and changes what is rewarded, then that culture-change can be accomplished in 12 months or less. On the other hand, if the leaders decide on a “bottom-up” change strategy or an incremental-change-over-time strategy, the change can take “forever” or not happen at all.

With this in mind, the more useful questions are, “What is the best pace for changing a business-culture?” and, “What can be done to control the rate of business-culture change?”

As a rule of thumb, most successful business-culture changes are fast rather than slow. The most obvious examples of this can be seen in the studies of successful mergers and acquisitions: the faster the acquisition or merger is “put to bed,” the more likely it is to be successful. [See, Five Frogs on A Log. A CEO’s Field Guide to Accelerating the Transition in Mergers, Acquisitions And Gut Wrenching Change, Feldmand and Spratt]. If leaders decide that a fast culture-change will be too traumatic for the business, then the business is better off to delay a culture change until it can be accomplished rapidly.

With this faster-is-better principle in mind, following are seven actions that make it more likely your culture change will succeed:

1. Document the compelling business reasons—not the culture reasons or morale reasons—for the change. Only with compelling—not nice-to-have—business reasons for change, can the change be sustained once it is opposed (and it will be opposed).
2. Clearly delineate how decisions will be made differently, how measures of business success will change, what will/not be rewarded in the new versus the existing business-culture, et cetera. At the very least, the new culture should be “seen” in what the company rewards and whom the company rewards: if the company-economy doesn’t change, the culture won’t change.
3. If 100% of senior leaders are not explicit advocates of these changes, or if their business plans do not clearly reflect the new culture, then remove them or terminate the culture-change effort.
4. Build a communication campaign plan that will “over-communicate” the compelling business case and, therefore, the changes that will be seen in “how we do business.”

   As a rule of thumb, most successful business-culture changes are fast rather than slow.

5. After you have done steps 1-4 in secret, executive-level meetings, then immediately start doing business differently, beginning at the top. Be ruthless when it comes to compliance with the new way of doing things… especially at the top. Do not hesitate to remove senior leaders who are not advocates and examples of the new culture. Refuse to compromise when it comes to doing things according to the new culture.
6. “Make a big deal” out of individuals and teams that exemplify the new business-culture.
7. Communicate “too much.” This means “talking” about the change—especially the business reasons for the change—in as many media and forums as possible. Do this so frequently that it seems you are over doing it. Give aggressive attention to capturing concerns and rumors and “recycling” them into true statements. Successful communication is not a function of a well-crafted message delivered perfectly; rather, successful communication is a function of many adequately crafted messages delivered adequately “every time you turn around.” [See, Leading Change, J. P. Kotter.]

In the final analysis, business-cultures change because business leaders listen to their customers who want those cultures to change. Companies that are in touch with customers are quick to change. Companies that are less aware of, or responsive to, customers either go out of business or survive “by the skin of their teeth.” This, of course, suggests that some business-cultures are “better” than others… or it may be more accurate to say some business-cultures are more viable than others. This is, in fact, true.

Business-cultures that value the customer most do best.

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