Relationships at Work - The Leadership Mindset Guide to Creating a Workplace We Love

How To Follow The Leadership Blueprint For Culture Change with Kevin Oakes

January 30, 2023 Russel Lolacher Episode 50
Relationships at Work - The Leadership Mindset Guide to Creating a Workplace We Love
How To Follow The Leadership Blueprint For Culture Change with Kevin Oakes
Show Notes Transcript

In this episode of Relationships at Work, Russel chats with author, keynote speaker and i4CP CEO Kevin Oakes on research-backed actions leadership can take to culture change their organization for the better.

Kevin shares his thoughts, stories and experience with...

  • What to consider in a listening strategy.
  • The mindset shift needed for a cultural renovation.
  • How an Organizational Network Analysis (ONA) can help with identifying internal influencers.
  • How Employee Resource Groups (ERG) can benefit your organization.
  • How learning development is the key ingredient to a great culture.
  • Why a healthy culture is a competitive advantage.

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For more, go to relationshipsatwork.ca 

And connect with me for more great content!

Russel Lolacher
And on the show today we have Kevin Oakes. And here is why he is awesome. He's the international keynote speaker. He is one of those. He's the CEO and co founder of the Institute for Corporate Productivity, henceforth to be named, i4CP - the world's leading HR research firm. He's the author of Culture Renovation: A Blueprint for Action 18 Leadership Actions to Build an Unshakable Company. It's all based on his research on company culture. One of the big reasons I'm talking to him today, because I'm a big fan of that book. He's been a pioneer in the human capital field for the past 25 years. And a fun fact I dug up on Kevin which I was really excited to share is he is on the board of Best Buddies, Washington, he started the chapter in Washington itself, a nonprofit dedicated to establishing a global volunteer movement that creates opportunities for people with intellectual and developmental disabilities. And now I get to talk to him. Hi, Kevin.

Kevin Oakes
Hey, Russ, how are you?

Russel Lolacher
I'm really, really good. Thanks for being here. So I got to start the question I asked every single one of my guests, which is, what's your best or worst employee experience?

Kevin Oakes
I've been running companies for a long time. So I haven't been, you know, quote, unquote, employee of others, you know, during that time, so, I mean, I'm an employee of the companies that that I run, and certainly, the company today, and I think the thing that I enjoy the most in our culture and in the company, overall, is our transparency. As a as a culture, I run our organization, as I did my previous one on an open book management philosophy, where every single month, we get together as a company, and we go over all the financials of the organization, so every employee knows how we're doing versus our plan, how we're doing versus last year, we've taught them all what EBITA means (Earnings before interest, taxes, and amortization). And, you know, they, they have a very good understanding of where we need to improve and what we've done well, and that aspect, I think, is just one of my favorite, because everybody is an owner in the company, I want to treat them, like owners want them to act like owners. And, you know, it's just it creates a different kind of atmosphere. And as a as a quote unquote, employee of my own company. I, you know, I appreciate that aspect.

Russel Lolacher
It's also such a reward to because it's something you obviously instigate, but then it's not a right away thing, because a lot of employees are like, not used to that kind of transparency. So it is a little eye opening and a little Is this for real? Should I be believing this is actually happening? How is the benefits been as you've implemented over time?

Kevin Oakes
Yeah, I think people know what's real, for sure. I think it just prevents as much as we can we try to prevent anyway, the the gossip, you know, the the watercooler, you know, kind of stuff that happens. And, you know, I never think that that's very healthy in an organization where there hasn't been good communication, and everybody's whispering and, you know, conjuring up the worst of, you know, what, what might happen going forward? You look at what is happening at Twitter, you know, it's a good example, you know, that it's everything secretive, right? And, you know, I just never think that that's a healthy environment. So I love the openness that we have.

Russel Lolacher
Oh, I'm going to talk and ask you a question about Twitter in a minute. But first, right there in the title, you talk about creating a unshakable company? What does that mean, especially in the realm of culture?

Kevin Oakes
You know, honestly, I think that's more important than ever, we've seen so many changes happen in the external environment that organizations have to deal with, on a regular basis. And most CEOs, they want to make sure I have an agile culture, one that not only isn't afraid of change, but embraces change. And to me, that's what unshakeable means is that you've created a culture that can't be shook by, you know, a global pandemic, or, you know, you know, any any kind of social or political or, you know, just incident that happens externally, your company is going to make it through that, even you know, within your own industry. If something remarkable has happened in your industry, you're able to continue to innovate and execute. So I think that's what unshakable really means to those CEOs. I want to rock solid organization that's going to make it through anything.

Russel Lolacher
When you're looking at cultural renovation. A lot of organizations will hear that or cultural transformation, which we know are two very different things. However, they think it is something they have to start. Do you see cultural renovation as something that is always ongoing, like an agile organization where it's continuous improvement, or is this something they stop and start over time?

Kevin Oakes
It's a little bit of both. I end the book with the comment that you're never done with Working on your culture and working to improve your, your cultural health. As you know, in the book, I talk very glowingly about Microsoft, for example. And Kathleen Hogan, the CH, Ro, and other HR execs get nervous when I do that, because they feel like, geez, we have so much more to do. And, you know, we are not perfect, but we've got a lot to work on in our culture. And so you don't just plant a flag in the ground and declare victory, right, you've got to continue to work on the culture. But when you're trying to initiate a new culture inside the organization, you know, or really make significant changes, there is a pretty significant sort of start period, when you do that. It typically is triggered by a new CEO coming on board, or an acquisition, or a series of poor quarters. That's what I see most of the time happen is, is when it's triggered, but I applaud several companies that I'm working with, who decide when everything is going great. Okay, now, we need to really, you know, start doing some different things with our culture, as we enter into this new world of work, you know, we've got, you know, a lot more remote employees, hybrid employees than we had before things have changed these past two, three year time period. And I think that's a good time to be looking at your culture is when everything seems to be going well, you know, let's figure out what do we need to do to continue to make sure that happens in the future? So there is a start point, but it's something that you should always be working on Ross?

Russel Lolacher
So is there not warning signs? Or is it some companies may be too far gone by sometimes by those red flags that start popping up? Or is it anytime is a good time for this?

Kevin Oakes
There are definite warning signs. When a culture is in need of renovation, you see it in the employee experience, you see it in employee sentiment. If you're trending down rapidly, then something has happened inside your organization. I have a great story in the book from workday, actually, who monitors and measures their culture on a regular basis, something that most good companies do. And they saw a slight downtick at one point in time in some of their engagement scores, and other other measures that they had. And they immediately went to action, they called other people leaders together. And they found there were a couple of underlying issues that they really needed to address. And I think that's fantastic. I think being on top of your culture, from that standpoint, makes a heck of a lot of sense. But we were big proponents of ongoing employee sentiment measurement, both internally and externally. A lot of there's a lot of things being said about any organization out on Glassdoor or other external sites, and the smart companies are monitoring that as well as what's happening internally. And making sure that, you know, those metrics are in line with your expectations. And if you have that sudden downturn, then you've got to, you've got to make some changes.

Russel Lolacher
What is your feeling on voice of employee? Do you think surveys are the best way to be monitoring what's going on your organization, or...

Kevin Oakes
There's a variety of different ways you can survey employees, and that's one way to monitor what's going on. So we talked about this very early in the book about establishing a listening strategy. And what some of the successful companies have done is made sure that they from a survey perspective, we're having an ongoing measurement of the employee sentiment, you cannot rely on an annual engagement survey to tell you much about your culture, that's a point in time survey, and you'll often get false positives, you know, something that's big at that time, you know, might not be big two weeks later. And that's why ongoing analysis makes sense. I'm a big fan of using technology in this case, such as natural language processing, combined with AI, which in larger companies allows you to let employees tell you how they're feeling in their own words. And then using that NLP AI engine to, to parse it out and to categorize things. So you can really understand you know, where do we have seemingly big issues? And where are the you know, what categories do we need to look further into? It'll also tell you do we have pockets inside our organization, which is very common, that, you know, from a cultural perspective, are more toxic, toxic than others? So I think the ongoing survey strategy makes sense even even asking a daily question like Amazon does, you know, I think it'd be very effective. But then a lot of organizations will do focus groups. They will get together and have, you know, just good discussions among peers along with leaders. We had several companies do culture hackathons, right? Just like, any kind of hackathon, where you get a group of folks together for a period of time to brainstorm, and innovate, you know, as a group, I think that can be very effective as well. All of those are helpful in gathering employee sentiment. There's many other ways, but those are some that I outlined in the book it self.

Russel Lolacher
What are your thoughts on anonymous surveys? Because a lot of organizations feel like they can't ask their employees anything without that anonymity. But I'm on the flip side of it going but then isn't your culture kind of broken If people only feel honest, if they don't put their name to anything?

Kevin Oakes
Yeah, I'm, I'm a less of a fan of anonymity, more of a fan of confidentiality, I think it's hard to promise anonymity. But because nothing is really is truly anonymous, right, you can kind of track back to where it came from. But confidentiality is what you should promise and honor. When any, when anybody is responding to a survey. So I steer people towards confidentiality more than anything.

Russel Lolacher
I like that. Thanks for that. Your book's really good at it, hey, it literally says blueprint in the title. So it's giving you 18 steps to cultural innovation. The problem is, as much as tactics are great and amazing mindset is probably the biggest shift for a lot of people to even pick up your book, to even know that they need it. What are leaders missing right now that they need to get into this world?

Kevin Oakes
I say this to leaders all the time, if you lock yourself in a conference room and decide amongst yourselves as a senior leadership team, what what's happening in the culture today, you're gonna get it wrong. Things are filtered by the time it reaches senior leadership. And so the real issues are aligning, far down below at the surface. And that's why that sentiment analysis is so critical. But in the book, we talk also about how do you engage the influencers and energizers throughout the organization, it's, it's very common in any organization. And even when I say this to people, they can picture somebody in their head, there are, there are certain people that you go to for subject matter expertise, but probably just for energy, you know, there are people in your lives in your life that you talk to, and you walk away, just fired up energize they, you know, they provide a different perspective. And there's the flip side, you know, people that kind of suck the life out of you, every time you talk to them, those influencers and energizers are the people at the ground level that typically know what's happening and have the year of the workforce. And so when you're trying to change culture, you want to make sure they're on board, they're kind of under the tent, they know what's happening, and they become part of your culture Ambassador network. So that that, to me is sort of a critical component. And I think, you know, for senior leaders, the you know, the trick here is to just is to continue to listen and pay attention and not assume that you know, what's happening. You know, like I said, the usual triggers are, you know, you have your, your attrition has increased significantly lately, or, you know, you've had a couple of bad quarters. You know, the you have new leadership coming in. And those are the things that are often going to trigger that that realization that, hey, maybe we need to really focus on improving the fitness of our culture.

Russel Lolacher
Assumption seems to be a bit of an issue too, for a lot of organizations. You mentioned about the well, basically the ONA - the organizational network analysis. How do you start that when you're trying to get those influencers, bloggers and energizers if you're an organization that has never done it before?

Kevin Oakes
So ONA is something that we're big fans of, again, stands for "organizational network analysis", and those influencers that I was referencing, if you ask senior leaders, who are the influencers and energizes in the company, they will only get a small percentage of that of them, right. They tend to think in terms of hierarchy. And so they think of people who are in leadership positions as being the people have influence. But oftentimes, those influencers are way buried in the hierarchy, most of the time they are, and sometimes they're even introverts. They're not extroverts. So it's, they're kind of easy to miss. And so organizational network analysis is a survey technique, although you can also get there by monitoring like teams or slack, although I don't necessarily recommend that that method, but it's a survey technique to triangulate who are people turning to and he asked, you ask your workforce simple questions such as, who do you need more time from? Who do you spend more time you know, most of your time with when you're seeking out an answer to an issue or if you have some sort of problem that you're looking to get solved? Who do you turn to for energy? And conversely, who D energizes you and just through that technique you can understand who are the people in the center of the beehive, if you will. And then who are the people kind of on the outskirts? So I love it because it it, it's can be used in a lot of different ways. I love it for what we're talking about here to change your culture, because those are the people who want to be your cultural ambassadors. But we often use it too just to find out if you've got really distinct silos in your organization, do you have entire groups that never communicate or collaborate with others? Are they only talking amongst themselves, which is a very common thing? Obviously, we've used it for Diversity and Inclusion measurement as well, just to see what's happening from a dei perspective. So there's a whole primer on ONA out on our website for those interested, but I just love that science.

Russel Lolacher
I'll put a link to it in the show notes to give people a little bit more direct access to it. Glad you brought up DEI. Now, I've heard of these groups in for different names, but I've never heard of them as employee resource groups until I read your book. And guess what it showed up in the news recently, when certain Elon Musk abolished all ERGs within the organization he had taken over, which was Twitter. So I'm kind of looking at and for those who don't know what ERGs are, they are usually volunteer volunteer, they're usually employee led, and they're aiming to foster a diverse inclusive workforce within an organization. All right, I'm just kind of curious A - what the benefit of fostering those are and why should we be scared if a grand poobah coming in is getting rid of them.

Kevin Oakes
There's so many benefits to ERGs and they sometimes, so that stands for employer resource group, or employee resource group, but they sometimes go by the name business resource group, employee affinity groups, there are a lot of different labels that you can apply to them. And it typically is bringing together employees in the organization who have a common interest. You know, it's very, it's very common for your your black employees or Hispanic employees to, you know, have their own ERG, but you see it for, you know, lots of different segments within the workforce. And you often will have a senior executive sponsor, the ERG, we have found it to be a great feeding ground for new leaders, you know, emerging leaders inside the organization, they also have tremendous influence in the organization and, and can inform the organization have a different perspective that maybe the organization wasn't thinking about, or wasn't thinking about how it impacted a particular group. So we, we've done a lot of research there and high performing organizations tend to put a lot more effort, even budget behind ERGs to, you know, just to improve the health of the organization overall, you know, with mosque, it's hard to see what he's doing right these days at Twitter, but I was really surprised that he just got rid of those emojis. And actually, they got rid of just a number of people in the DEI group, you know, I just think that it's not going to serve them. Well, in the long run, I just I failed to see how it will. So, you know, my advice to any any CEO is don't do what Musk does. You know, and, and support those energies in your company.

Russel Lolacher
Environment's huge when it comes to, you know, employee renovation. The problem is a lot of people are overworked, they're burning out. So when an organization comes in and goes, we want to change the culture, tweak it alter it, however it is, people are just looking at it going, Oh, I got more meetings to go to, oh, I've got you know, you're adding more to my workload. Let me do my work my subcultures Fine. How do you implement things like professional development, learning to an organization that is probably resistant to culture change like that?

Kevin Oakes
Well, I think learning is one of the biggest components of a healthy culture, if you have a learning culture, and have put a lot of time energy money into into learning, you typically have a pretty healthy organization. Done right, it should energize the culture, not create more burnout. And we've seen in many organizations, they have leaders, exhibiting the willingness to learn. They stress the importance of learning, and they even teach, you know, leaders as teachers is, is something that some of the highest performing organizations embrace. And they make sure that that's an expectation of new leaders coming in that they are going to be teaching courses to employees inside the organization. And we've done a whole research study on that and webinars on that topic alone. So I'm a I'm a big believer in in learning, not only within the organization, but giving employees the opportunity to get degrees to get certificates out I have the organization, I'm on the advisory board of a company called guild education, for example, and they do a wonderful job connecting employees to higher ed opportunities with the support of the organization. Because more and more today is as we have this war for talent still happening a lot of employees are as they look for their next job, they're looking to an organization that will help them develop as an individual, I want to grow my career, and they're choosing employers who are embracing that opportunity. Even if you think about frontline employees, you know, you see that being a big distinction of companies like McDonald's or Walmart, or even Amazon who are put a lot of effort into making sure that those frontline employees have have educational opportunities available to them. So there's so many benefits from being a learning culture overall. I just think it's a critical component here.

Russel Lolacher
It's funny, I don't think it's mentioned enough how much renovating a culture focusing on things like you're talking about about development and investing in employees is a competitive advantage. If there's a war on talent, they're going to want to go where they're going to be treated? Well, not the place that has beige walls and cubicles, like there.

Kevin Oakes
Yeah, you know, it's all in the employer brand. And more and more executives are recognizing that we have an employer brand, good or bad, you have one. And so you want to make sure that your employer brand is continuing to improve over time, because you want to be a an employer of choice, you want people to want to come work for your organization. And, you know, unless you're having them, you know, click on a box and sign that we're going to work long hours and be overworked. Yeah, like Twitter just did, I think you've got to, you've got to put the effort in to have those opportunities. You know, development, mobility is another one that I'm a big fan of. That's what employees want these days.

Russel Lolacher
I want to pull out a quote that you said from your book, which was how much you hate talking about performance measurement, because everyone has an opinion. And it's not based on anything around data or personal observations. But the funny thing is, a lot of people feel that culture is that as well, because it is something everybody has an opinion, or they have an idea of what a culture is, or when it should be changed or not. So why is it easier to talk about for you for culture as a whole, rather than to talk about things like performance management?

Kevin Oakes
Well, you're right. I mean, everybody does experience culture. And I didn't even define culture in the book, because it you know, it's just, it's something that you know, what it is, you know, what the culture? Is an organization good or bad? Performance Management? Yeah, I did have that sort of tongue in cheek. comment about it. We've changed the way we've done performance management over time, over and over again, right, we, you know, we've gotten away from annual reviews and formal ratings, to a lot of companies that move more towards a just a good managerial conversations around performance. The problem with that is a lot of managers don't do it. And employees are actually looking for more of a numeric rating, and I'm doing something a little bit more tangible. So some companies that move back to doing that. I just think performance management has a lot of opinions, because we've all experienced it. And many have experienced that on both sides of the equation, you know, giving reviews and getting reviews. The, I guess the the simple aspect of it that I dislike is when it boils down to just one person's point of view, I'm always a bigger fan of taking a more objective and making it as as objective as possible, through you know, 360s, and through data that you have around somebody's performance, versus a very subjective performance review. And I think that's where you get, you tend to get in into trouble inside of organizations. So the point I made in the book about performance management is what we found with companies who were successful in changing their culture. They usually realigned to their performance management process to to be in alignment with the culture change that they wanted to see. It wasn't we didn't necessarily recommend a specific way to do performance management. It was really more around the change that companies were making to align the process to what they wanted to see in the culture.

Russel Lolacher
Whose job is this? To renovate a culture because I mean, leaders will go Yeah, it's mine. Totally mine. Oh, but then as soon as it's tasked, like HR will do it. And HR seems to have about 17 other jobs on top of Oh, and I have to do culture to How is this even resource properly to be making these changes?

Kevin Oakes
There's no question that the CEO is the owner of the culture inside the organization. So I want to make that statement just flat out, you can't get around that. However, the CEO can't change culture all by him or herself. And that's where HR usually gets involved right there supporting the culture that the CEO has a vision for going forward. But in the book, I talk a lot about creating a co creation mindset, meaning you're not going to do it alone, you're going to get the help of many others inside the organization to make sure that that culture change happens at the ground level. And that's where those influencers and energizers come into play. And throughout the book, as I profiled companies that successfully changed their culture. Keep in mind, most companies who set out to do this, they fail, only about 15% actually succeed. But of those 15%, in I profiled many companies that fall into that bucket, it was pretty clear that this was leader lead, but with a lot of help and cooperation throughout the organization.

Russel Lolacher
So why are there still gaps? How many surveys do we hear where the leaders are like, we have amazing employee engagement. And then you talk to the workers. And they're like, we don't even ever see our bosses ever, or there's the gap with empathy. But you keep hearing about these gaps. I did a keynote the other day, and I was going through all these different surveys where there was these huge gaps. And executives, like, did you read one survey where there wasn't a gap? I'm like, No, and especially after the pandemic, because suddenly everybody just started waking up around what they were interested in doing and not doing anymore, especially generationally. So, yeah, with the pandemic and the change. That's all happening now. How have you seen that shift? Even because you wrote this book during the pandemic, and released right, during the pandemic? So what, what is shifting? What are we getting to a better place? Because I know, there's the the examples you gave in the book, which are phenomenal. But are we really bringing everybody else with us?

Kevin Oakes
Yeah, you know, I think, if there's a big gap in perception between employees and management, then you have big problems in your organization, right, you should not have that huge gap. That just tells me that management is not in tune, and hasn't done enough sentiment analysis to really know what's happening inside the organization. Now, keep in mind that while culture change is critically important to the overall financial health of the organization. The reason a lot of companies don't spend a lot of time on it, because because it's damn hard to do. It's not easy to effectively change the culture of a company, my, even my father would dedicated the book to who was the CEO of a bank, and then an insurance company years ago, he after he read the book, he said, You know, when I took over that insurance company, it was 100 plus years old. He said, the culture was in the woodwork. He's like, I didn't know what to do as CEO to change that. Because they were, they were just set in their ways. He's now reading the book, I wish I had that book, then because I now I know the steps to take in order to change the culture. But it's just it's not an easy thing to undertake. And I think, going forward as as we enter this new era of work, you know, we asked everybody, a lot of people anyway, work remotely, you know, on, on a moment's notice, you know, everybody just started working remotely. And by and large, that worked, people were productive. And, you know, companies, companies figured it out and made it work. As we emerge from that, I'm not a huge fan of the you must be back in the office a minimum 40 hours a week, and, you know, in the office five days a week, because we gave them we trusted employees with their freedom, and employees rewarded that trust. And now a lot of CEOs, I think, don't necessarily have the trust that people are being as productive unless they're in the office. And it's just really a childish way to think about things. My opinion, I really think five years from now, we'll look back on this time period, just laugh at some of the, you know, things that we that we did as organizations and what some CEOs did, you know, with the people of their company, I just think adults want to be treated like adults, and they want to be trusted. And having somebody's button to seat is not going to make them necessarily productive.

Russel Lolacher
You've been in this sphere a really long time. 25 years, lots of research done for this book. Did anything surprise you? I mean, the escalation of change has been insane. So I'm just kind of curious if anything was jumped out in a way that you weren't expecting?

Kevin Oakes
Yeah, I think it's how resistant to change some organizations are which is a little surprising, given all the change that's happened. It's it really is death knell for for many companies, if you're resisting change, then you're just you're gonna go the way of, you know, Polaroid or, you know, famous companies had just never adapted to what was happening out in the environment. So that aspect kind of kind of surprises me, I was very fortunate to have the cooperation of many Fortune 500 CEOs in the book, and just have them share their stories. But just for your audience, Russell, you know, give them a little bit of background on how the book came to be. We did one of the largest studies ever conducted on corporate culture, we had over 7000 organizations, as part of it to really look at are there commonalities of that 15% that succeed in changing their culture that we could share with others that others could learn from. And that's the blueprint that you've referenced that where we had 18 steps, we divided those 18 steps into three phases. And using that renovation theme, the phases were plan, build and maintain. And the reason we use the renovation, as a term here, rather than transformation is, as we got into the research, it was pretty clear the successful companies, they didn't transform their cultures, they didn't become something completely different from what they were, instead, they very carefully renovated things that were hard to replace or unique about them. And they renovated just like you would an old house to improve the value for the future. And so that's why that that term just became a much more appropriate, approachable and probably appropriate term, for you know, what, what some of these successful organizations were doing. But the blueprint does read very sequentially. And it's really written for the leaders in the organization to take this, you know, these 18, sequential steps towards improving the fitness of the overall culture. And I've been thrilled that we have many large companies who are using this as their guide to change their culture, even large military divisions are using this today, which that was a surprise to me, I did not write it with the military in mind. And I was very pleasantly surprised that I've, you know, had to spend a lot of time now with certain, you know, certain segments of the military, as they try to learn from the corporate world and how they can change the culture of their, you know, of their groups.

Russel Lolacher
I'm going to wrap you up with the last question I asked everybody, Kevin, and considering you have 18 steps, this, this might be a little difficult, I need to boil it down to one. So what's one simple action people can do right now to improve their relationships at work?

Kevin Oakes
We talk a lot about positive intent in our organization. And I think that's something that is missing many times from the discourse in the world today, you know, as we just went through the midterm elections, politics, you know, brings us out quite often in organizations where people assume somebody, you know, saying one thing or they assume some, maybe somebody's undermining them or doing something. So we, we try to stress positive intent that if you start with the assumption that somebody is trying to do something positively, you're gonna have a much more respectful environment. And I think respect is a word that we'll see used a lot more in the future as we talk about just good relationships at work overall.

Russel Lolacher
That is Kevin Oakes. He is the CEO and co founder of Institute for Corporate Productivity (i4CP). He is also the author of a book I couldn't recommend enough which is Culture Renovation: A Blueprint for Action 18 Leadership Actions to Build an Unshakable Company. Thanks, Kevin for being here.

Kevin Oakes
Thanks, Russel. It was fun.