How to hack corporate culture: stories, heroes and rituals in startups and companies

Sometimes the inability to change the culture that has developed in the company is a guarantee of the failure of any innovation attempts made by the company. Changing culture almost always involves problems: resistance to change (we have always done this only), adherence to traditions (the world is changing, but our values ​​are eternal), discrepancy (our values ​​exist, but we do not apply them). But they are possible thanks to the combination of hacking culture and stimulating its new version by changing motivations.

This year, the author of the article, Steve Blank, spent working with corporations and government organizations that use and adapt lean manufacturing techniques. One of the interesting innovations that he encountered revolves around company culture.
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So, startups have the luxury opportunity to build corporate values ​​and culture from scratch, and existing companies that want (re) to launch corporate innovations should “reload” their existing and most often deeply rooted corporate culture. This is not an easy task, but if you fail to change the culture, it will doom to any innovation attempts made by the company.

Innovations in corporations require innovative corporate culture

Innovation in an existing company is not just the result of new technologies, valuable acquisitions and the work of smart people. Innovation in a corporation requires its corresponding and supporting corporate culture. Often this means that the existing culture of the company must be completely changed. And convincing employees of the need to get rid of old values ​​and beliefs in favor of new ways to increase productivity can be a serious problem.

Too often, a corporate innovation initiative begins and ends at a meeting of boards of directors, where it is presented by the CEO along with a series of handouts to employees, posters, and one-day workshops. All this creates only a “theatrical presentation of innovation”, but not the innovation itself.

Two consultants at McKinsey, Terry Deal and Arthur Kennedy, wrote a book called Corporate Cultures: Rites and Rituals of Corporate Life. In this work, they showed that every company has a culture, and this culture is the symbol for "how we do something in our company." Company culture includes four essential components:

• Values ​​/ beliefs are the philosophy of everything the company does, and especially what it supports.
• Stories / Myths - Stories about how the founders or employees coped with difficulties, got good orders, and so on.
• Heroes - those who are praised and valued in the organization.
• Rituals are what regularly happens in a company in a special way.

Strength of corporate culture

Steve began to realize the power of corporate culture when he joined the third startup in his life called Convergent Technologies. The values ​​and basic beliefs that existed in this insane venture boiled down to stating that we were a Silicon Valley Navy. If you could not say that you would like to join the navy of technologies, then you shouldn’t get a job with us. And if this opportunity attracted you (and more often it attracted twenty-year-olds with raging testosterone), you could try.

By the time when Blank joined this company, there were already many stories about “victories over incredible oddities” and “innovations on their feet”. For example, everyone knew that the founders had changed their business model for creating computers based on the same scheme as the new-fashioned Intel microprocessor. An alternative was the sale of entire desktop technology stations with an operating system and office applications (predecessors of the PC) to other computer companies. And the CEO made this experiment before the initially disinterested client, who after one meeting made an order for 45 million dollars.

And each subsequent deal with a new client was celebrated (the deals were worth tens of millions of dollars), and our sales staff became heroes. And when in order to meet the requirements of customers, any actions of engineers were needed (and this happened in almost every transaction), the engineers were also treated as heroes. And when marketing got to the industry, we, marketers, supporting sales, also became heroes.

Finally, every large order was accompanied by rituals and celebrations. They called bells and beat the gong. The CEO wrote out bills for $ 100 and gave out a premium of $ 25,000, which had been mentioned for years. Once he even made an inscription on the wall in the lobby with a can of paint that was supposed to remind us that we must deliver our new product on time (a very rough inscription, it will not work to write here, but the author remembers it even now, 30 years later ).

Steve's position and corporate card, of course, described his functions as an employee, but these unwritten values, stories, heroes, and rituals determined the behavior that was expected of him at work.

How to define corporate culture

You can get an idea of ​​what the company's culture is, even before you get inside the building. For example, if a company says “We value our employees”, but separate parking places are reserved for its management, there is a separate cafeteria and much better offices, then this statement is nothing more than an advertising move. Exactly the same can be said if the CEO proudly speaks of a corporate incubator, the parking of which becomes empty at 5 pm.

At several lunch breaks, you can learn more about corporate beliefs, heroes, and company rituals than from all of its inspiring posters. In Horizon 1 and 2 companies, stories were built around heroes and insurgents who were able to do something completely new contrary to the existing process. The rituals in these companies relate to reorganization, promotion, positions, promotions, and so on.

These core values, beliefs, and related stories, heroes, and rituals also determine who is important to the organization and who the company wants to attract. For example, if a company values ​​financial manipulation above all, then stories, myths and rituals will include how the hero saved 5% by entering into a deal with the supplier. Or, if the company is focused on breakthroughs in its products, the characters, stories and rituals will relate to manufacturing (for example, Apple's legend about the development of the Mac, iPod and iPhone).

How to hack corporate culture

In order for innovation to be carried out deliberately, and not as rare exceptions, companies need to hack their corporate culture. This means that you need to deploy a psychological war in your own company. This process should be conducted carefully, thoughtfully and coordinated with the personnel department and financial director.

1. Find out how your employees understand the values ​​and beliefs of the company.
2. To convey the need for new values ​​and a new way of thinking to workers is very difficult. You need to start with thinking about new values ​​and beliefs that the company wants to live by.
3. Plan and coordinate what needs to be done to create new stories, heroes, and rituals based on these values.
4. In parallel with the creation of a new culture, restructure the company's motivation program (plans for compensation, bonuses, promotions, and so on) for these new values. Failure to restructure motivations will doom any attempt to change culture.

To create an innovative culture, companies need heroes and stories about employees who have come up with new business models, new products and found new customers. Stories of new product lines from the insane idea.

Or heroes like the manager of the old guard, who all the time sent the best teams to the corporate incubator. Or groups of top managers who adopted and adapted the new product, turning it into a successful line.

Or teams of engineers who left the building learned about the needs of customers, created a new product in accordance with them, and created a new division of the company.

And rituals and rewards should support such innovations (and not just be entertainment).

Changing culture almost always involves problems: resistance to change (we have always done this only), adherence to traditions (the world is changing, but our values ​​are eternal), discrepancy (our values ​​exist, but we do not apply them). But they are possible thanks to a combination of hacking culture and stimulating its new version by changing motivations.

As a result, innovation in the culture of a company can grow, become multi-purpose, develop quickly and confidently.

findings

• Corporate innovation requires innovation in corporate culture.
• Corporate culture consists of values, stories, heroes, and rituals.
• Start-ups from scratch build values ​​and a culture focused on innovation.
• Existing companies wishing to (re) launch corporate innovations should reload the existing corporate culture, and this is difficult ..
• Corporate culture can be hacked.
• The hacking process must be careful, thoughtful and coordinated with personnel and financial services.

PS We recommend another article on the topic - Team cohesion: success or failure?

Translated by Vyacheslav Davidenko, founder of MBA Consult