Why cultural change is so critical to success in business

It’s a widely held belief that all businesses will need to go through a process of reinvention in order to stay relevant, according to Darren Hill, executive director of Pragmatic Thinking.

Hill said that while this viewpoint has served some companies well, it’s not the ideal way to go.

According to Hill, the key to reinvention isn’t altering a product, delivering a different service, or looking for another demographic. Instead, it’s about the value of cultural change.      

“It’s concerning that the business case for culture is widely accepted, yet still very few leaders know how to actively shape and shift their cultures effectively,” he said.

Hill’s outlook echoes the findings of a 2008 survey by McKinsey, which showed a whopping 94% of senior executives said that people and culture are the most important drivers for innovation.

He added that it’s crucial to “shift the definition of value towards purpose-driven value rather than monetary value”.

Hill’s first piece of advice for leaders is to accept that they may well be contributing to “cultural dysfunction”.

“As a leader, if you’ve decided that your organisational culture needs to shift, you need to accept that you’ve led the culture to its current misalignment,” he said.

Hill’s second point is that a failure to emotionally ‘buy-into’ proposed cultural shifts, is a problem faced by senior leadership teams.

“Without a doubt, the single-biggest roadblock to successful culture change is the most senior level of leaders see it as something else their people have to do, and abdicate their own responsibility to lead the change.”

Darren’s third observation around the pitfalls of organisational growth was a “failure of congruence at a leadership level”.

“Every organisation has values, they’re those words that often adorn key documents and find themselves on pull-up banners,” he said.

However, he goes on to question the accuracy of these “corporate hallmarks”.

“Turns out your organisational values are much more aligned to the everyday conversations in the hallways than what is written on the wall.”

Hill advises leaders to listen and observe the behaviours and chats that occur in the corridors.  

Indeed, success in business is all about “connection”, he said.

“While values-driven organisations are in vogue at the moment, it is vital to have organisational values that truly reflect the values of the people in the organisation.”

Hill added that “every business is a human business”, and that “without staff emboldened by a sense of purpose there is little point in running a business”.