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Culture just exists, whether you want it or not.
If you don't manage it properly, you might create negative and
counterproductive cultures that don't really emphasize
the things that are going to serve your organization.
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Culture was readily dismissed up until the late 1970s as something
managers don't really need to care about.
But as organizations and work becomes more complex, and
people no longer work on an assembly line where you can basically procedurally
tell them what to do and it doesn't really matter what they think because
the assembly line solves all the dilemmas for them.
As robots are replacing this, and people are put more and
more in positions where they need to make decisions.
There's no way we can exhaustively kind of describe all the situations that employees
are going to deal with, and that's where culture comes into play.
It's when there are these implicit understandings about what is important and
what isn't important, and what we're trying to maximize and
what we're not trying to maximize, and who we are and who we aren't.
And there's also this kind of moral code that holds us together.
Then you would expect that, on average, employees would do the right thing
even if you haven't specified precisely in the recipe of how to do it.
So that's why culture is becoming increasingly
more important in organizations, and
is increasingly recognized by leaders as something that they need to invest in.
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We basically find that people follow one of three trajectories.
Either they show a gradual increase in their level of cultural fit.
So basically they're slowly learning the code and behaving appropriately.
These are people who stay in the organization and succeed.
We see people who never really show an increase in their level of cultural fit,
relative to what they were immediately after joining the organization.
So that indicates to us that they're either incapable or
unwilling to adapt culturally.
And those are the people at extreme risk of being fired.
So basically these people, if they survive a year, and
they rarely do, they have a 50% chance of being fired by that time.
And finally, we find, I think, the most interesting group of people are those who
demonstrate this inverted U-shape.
These people who are capable of adapting but
at some stage start showing a decline in their level of cultural fit.
And that's a strong indicator of people's intention to leave voluntarily.
So really we see these different signatures in terms of people's
enculturation trajectories and
how those relate to their outcomes in the organization.
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So imagine a group of software engineers that all sit together in the same room and
play ping pong in after hours and know one another.
Those type of groups can really tolerate the nonconformist weirdo.
And that might actually be a very good thing for
the organization because that weirdo, so to speak, right,
this person who is not behaving in the appropriate way it's probably also
the reflection of the fact that that person is bringing new ideas and
new sensitivities and has different ways of thinking of problems.
And that might be really important for the organization's success,
especially if this organization needs some innovation and
new thoughts in order to be successful with its product offerings.
So we find that there's this tradeoff between your ability,
or tendency to behave in a compliant way.
But also this security, or lack thereof,
that you gain from the extent to which you're part of a tight knit group or not.
And really being in the right kind of sweet spot leads to
the greatest success in organizations.
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On average, having a strong culture is a good thing.
If everybody is aligned on the same important values, and
if we would expect therefore that faced with the same kind of situational
dilemmas, everybody would solve them in roughly the same way and
in a way that's conducive to the organization strategy.
Then yes, a strong culture is going to be beneficial for the organization.
But at the same time, you don't want echo chambers,
especially if you're an organisation that competes on novelty.
If you're a Google, or an aspiring Google, or if you're an Amazon, or
if you're even innovating in retail and if you're innovating in transportation,
you don't want your organization to be an echo chamber.
You want to empower your employees to also take risks sometimes and
think outside of the box.
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Some organizations are architected in
a way where actually people aren't part of strong groups.
They kind of crisscross different functional roles
in teams in a matrix kind of structure.
So in those organizations people would probably put a strong
emphasis on being culturally compliant and
there will be a strong rewards to strong cultures that everybody is aligned around.
However, you can image other types of organizations that are built of
strongly connected groups, where inside the group people have very
strong familiarity with one another and very intimate with one another.
In those groups you can afford, or
those individuals can afford to behave in a culturally non-compliant way.
And it might be the case that those groups,
if they have a good mix of people who are compliant and non-compliant,
are the ones who might come up with the most brilliant and innovative ideas.
So it's not that there's a kind of one size fit all recipe
that facilitates how culture kind of translates into good
operational results from an organizational point of view.
Different organizations, different organizational architectures,
and different strategic imperatives, prescribe different and
intricate relationships between structure and culture in the organization.
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