An interview with Dr. Jim Ludema
Jim Ludema, Ph.D., is the director of the Center for Values-Driven Leadership and a Professor of Global Leadership at Benedictine University. He’s also an expert in organizational culture and values, and a globally-recognized pioneer in the field of Appreciative Inquiry. Here, we ask him about leading culture change.
Let’s start at the beginning. How do you know your company’s culture needs to shift?
It’s not always clear right away; it’s like that old saying that everyone knows what water is, except a fish. If you’re the fish, you’ve been living in your organization’s culture so long it can be hard to recognize.
I find that when culture shift is required, it’s usually for one of three reasons. The first is there’s a clear sign you have a problem. Words like “toxic” or “sluggish” or “hostile” get used. If that’s your organization, a culture shift is definitely required.
The second common reason is you’ve had a challenge to your core business model. Maybe innovation isn’t happening, or sales are low, or you’re losing market share. In those downturns, we often rush to blame people or change the business model: Fire so-and-so! Incentivize innovation! Drop the price of the product! Put pressure on the sales team!
Those are decent options, sometimes, but the real problem may be that it’s time for a culture shift.
Finally, growth is the third common reason a culture change might be needed. You’ve outgrown your current culture. Maybe a family environment worked great at 30 employees, but now you have 3000, and you need to professionalize. Maybe you’ve merged with a competitor, and you have to weave two cultures together. Maybe business is going great, and keeping up with it takes something that the past didn’t require.
There are other reasons for a culture shift, of course. But those are the most common I’ve seen as a leader, consultant, and researcher.
Alright, so you’re a leader who recognizes the need for a culture shift. What do you do next?
Let me challenge you a little on that question. I don’t think it’s the leader’s job to shift culture. Or rather, it is not solely the leader’s job. A culture shift is not for mavericks – you cannot “go it alone.”
A culture shift is not for mavericks – you cannot “go it alone.”
And at the same time, as the CEO or senior executive, you have to put on the hat of “Chief Culture Officer” and say, “this is absolutely a priority.” The way you do that is to assemble a team – not your usual senior leadership team, but a cross-section of the organization. You want people from the factory floor, and truck drivers who haul your product, and the receptionist in the lobby. You want the marketing director and the CFO and the 24-year-old who runs your social media. You definitely want some of the sales team, folks in your call center, and customers and other partners. You get the idea – you want the full range of stakeholders who determine your chances for success.
Then you start to listen. You ask some really good questions.
What questions do you ask?
It’s tempting to start with the negative stuff, like “What’s wrong?” That’s a “SWOT” analysis approach where you outline the weaknesses. But I actually don’t think that’s productive.
A decade or two ago there was a company that ran oil change service centers across Ohio and Pennsylvania. Their customer satisfaction rating was in the 70s, and they wanted to do better. So they called up the dissatisfied customers and asked what had gone wrong; then they trained their mechanics on what not to do. Don’t leave muddy footprints in the car. Don’t say it will be done at 2 when it won’t be done until 4. Don’t serve bad coffee, etc.
You know what happened? The satisfaction scores tanked. The mechanics spent all their time focusing on what not to do, the weaknesses, and they had no new ideas or energy for what they should be doing.
That’s when we were called in. We flipped the question. We called satisfied customers and asked them what they liked about the service they received. Then we trained the mechanics on these skills. They liked when someone answered the phone quickly. They liked when the mechanic showed them what was wrong with their car. They liked when the service was done on time.
Six months later we measured satisfaction scores, and they were well into the 90th percentiles. Customers were delighted – and the mechanics were as well.
That’s why I don’t think you start with “what’s wrong?” If you need to shift your culture, start with what is right.
If you need to shift your culture, start with what is right.
So how do you do that?
In our practice, we use a tool called Appreciative Inquiry. It’s a strength-based, future-focused methodology for leadership development and organizational change. I’ve found it to be particularly effective for culture shift because it intentionally engages the whole system. Everyone gets a chance to have their voice heard.
I also like Appreciative Inquiry (AI) for culture shift because it draws from the best of our past – and who we are when we’re at our best – to create an inspiring vision for the future. And frankly, when facilitated well, AI can be a lot of fun.
How do you get started with Appreciative Inquiry?
Within AI, six common questions are asked; you adapt these questions to meet the challenge or opportunity you’re facing. Then you ask the questions to as many people as possible – that cross-section of your organization, or even the whole company – including customers and vendors and neighbors. From their answers, you can find patterns that speak to who the organization is when its culture is operating at its best; and also ideas for shaping the future.
Then you have to work through a design process to shape those ideas into something that can become the strategy, and eventually become your new culture.
But really, it all starts with asking the six questions. I’m always amazed at how they generate new ideas and bring teams together.
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Jim Ludema, along with his colleagues Mike Manning and Amber Johnson, is the author of a free eBook on the Appreciative Inquiry questions, Six Questions that Can Lift Your Leadership, Shape your Strategy and Transform Your Organization. Download it at www.cvdl.org/sixquestions.