Culture change is one of the most important aspects for organizations that seek to break off a bad performance trend and leap towards success. But, it’s one of the most challenging elements of such a transformation often induced by the consequences of a failed strategy. Much has been written about culture change, and often we find contradicting advice about how to turn it into action.
Working at the University of Michigan during one of its most important transformations; living in the State of Michigan, face to face with a floundering State-government; near Detroit, and next-door to some of the most gigantic economic failures in Corporate America - we hear a lot about culture change and we see examples about “do’s” and “don’ts” of culture change.
In all these examples – whether good or bad – there is one lesson that could not be clearer: culture change starts with a change from the top-down! Consider the turn-around for Chrysler LLC. During the nerve-wracking negotiations with Fiat, the Unions, financial partners and the Obama Administration, three important transformations occurred to signal culture change:
- The restructuring of the entire leadership makeup, eliminating unnecessary layers of administration.
- The implementation and deployment of a new quality assurance process in all parts of Chrysler.
- The painting and fixing up of manufacturing infrastructure.
I am sure there are many other important changes that a person reading the news would not necessarily see. But, to a layperson on the outside of the company, this looks like a company that wants to undergo culture change. First, the system was” re-booted”. There is a new CEO, a new organization of the company’s top echelons, a new board, and new processes focused on solving the company’s biggest problems. This is a strategic directive that affects the quality of each and every product and each and every worker. And, the moment every worker walks into the newly painted factory it is clear: “Hi – welcome to the new Chrysler. If you want to work at the old Chrysler, go find it elsewhere. It’s not here anymore.” That is how culture change starts – the future will tell us whether it is good enough to lead to success for Chrysler LLC.
Contrast that with attempts to change the culture of our political structures. Indeed, there are few organizations that have been less effective in culture change than the Michigan State government. There may be good people involved – I don’t know many. But, it is obvious that all three necessary elements of culture change are basically absent: great leadership, a good strategic direction, and an effort to communicate and implement change throughout the State. Sadly, we invest more in image than transformation of our self-image.
Culture change is very unforgiving. All that matters is actions! If words were a good measure of culture change, Michigan would be on par with some of the best performing states in the US, but we are not even close. And, Detroit would be like Chicago, or better. It’s tough to see how to help Detroit. It is agonizing to see the claws of corruption ripping the heart out of any caring citizen. People stealing money dedicated for schools, leaders taking away millions from a population who never needed it more. Just like with Chrysler, the transformation of Detroit will depend on three things: leadership, a strategic direction that can lead to success, and the ability to communicate this direction and get buy-in across the city and region.
Clearly, culture change comes from leadership, implemented strategically and communicated and implemented across the organization so everybody understands: “This is not the place it used to be – this is different now!”
The University of Michigan has been undergoing major changes as well. We want to become a University who lives up to its potential of excellence and who can impact the region around it. Let me answer the most obvious question: “No, we are not as good as we can be!” Just like some of the big companies currently in trouble, we have started to believe in our excellence, without worrying enough about actually performing to that standard. The result is that we have let our University fall behind relative to its excellence in teaching, excellence in research and service – and also excellence in the administrative processes that support its core activities. This has had major consequences for the University and the impact it can have in its environment.
I actually believe that the College of Engineering is truly taking a leadership role around the University which is lead by a change agent as well. Needless to say, I am biased – I work at the College of Engineering and I love working there.
Yet, I don’t believe that we are working at our full potential. But, I observe many people at many levels that actively are trying to improve the quality of what they are doing, and the impact their work has, whether this is as an assistant who greets people at the door, a student advisor who introduces freshmen to their new lives at UM, a researcher in her lab, a teacher in his classroom, or department chairs who agonize with major challenges and focus on great opportunities. Culture change affects everybody. We will only live up to our potential if we all work with the same level of commitment and excitement to achieve true success.
There is nothing more exciting than to be part of change! That’s what entrepreneurs cherish, and – looking at the examples addressed here – that’s why we need people with entrepreneurial mindsets everywhere: in small companies, big companies, state politics, city leadership, and also at the University of Michigan.