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Case Study: Culture Fixes a Troubled Company

Recognize This! – A powerful, positive, appreciative culture is critical to a company’s recover.

Earlier this week, the Wall Street Journal published a quite interesting article case study of Dynegy, Inc., in the article “Can a New Culture Fix Troubled Companies?” As the article points out:

“Increasingly, leaders of troubled businesses try to fix the company’s culture along with its bottom line. Since the financial crisis struck in 2008, CEOs have sought to improve collaboration and decision making, recognizing that a strong culture is ‘a critical component of their long-term success,’ says Nick Neuhausel, a partner at consulting firm Senn Delaney, which advised Dynegy.”

Throughout the article, using Dynegy as the example, I see three key components of how to change your culture while keeping a focus on strategy guidance.

1) Rebuild Trust through Honest Conversations (and start at the top)

Dynegy CEO Bob Flexon began his culture overhaul by rebuilding trust within and among his senior leadership team:

“In June, the company’s 37 highest-ranking executives participated in a two-day offsite meeting led by Senn Delaney, which included trust-building exercises. In one drill, a pair of managers spent one minute expressing appreciation for each other’s work, then spent the next giving constructive criticism.”

Think about how you receive information such as this from others. Do you tend to push off praise or do you accept the positive feedback as emphasis of what you do well and where you excel? With constructive criticism, do you accept it in the spirit it is given or do you see it as an attack? Both versions of feedback are critical to honest conversations and healthy rebuilding of a company culture built on trust and recognition.

2) Base Performance Reviews on Your Cultural Hallmarks (Core Values)

Dynegy first focused their energy around specific core values and then looked for ways to bring those values to life for employees:

“Then, executives tried to carry out their pledges. Employees got performance reviews for the first time in two years, with bosses judging their subordinates in part on whether they embraced the core values.”

Building your core values into the performance review process is a key step in carrying your values throughout the work. However, an opportunity remains for Dynegy to do better in this area by not limiting this feedback to once a year from one person, but expanding the opportunity for all to contribute positive feedback on everyone else who lives the values throughout the year. (This is the essence of the crowdsourced performance review.)

3) Establish Culture Champions

Let me be clear. Every employee owns your company culture. All are equally responsible for contributing to the culture. That said, establishing culture champions is a smart move. Empower these champions to reinforce your culture and your goals. Here’s an example from  Dynegy:

“Meanwhile, 15 specially trained ‘culture champions’ are attempting to reinforce the message. At meetings, one such champion, Chief Administrative Officer Carolyn J. Burke, says she sometimes chastens a colleague for tapping on his BlackBerry by declaring, ‘Hey Joe, be here now.’”

Has your organization undergone a culture revolution? What steps were taken and how was the new culture implemented?

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