Implementing the lessons learned at Hay Group’s 2012 International Conference.

1. Aligning
strategy
culture Implementing the lessons
learned at Hay Group’s 2012
International Conference
The biggest challenge for most organisations is not working out what their strategy
should be, but working out how to bring it to life and make it happen >>
As Israel Berman, head of Hay Group in Europe, said in his opening n Actions and behaviours – clarity about desired behaviours,
remarks at this year’s Hay Group International Conference in Berlin, managing performance in line with these, reward
what differentiates the best companies from the rest is a powerful programmes that reinforce them.
corporate culture that drives great performance, enabling teams
It is critical to have alignment between the organisation’s core
and individuals to realise their strategy and their own potential.
values, the messages it sends to people and the behaviours it
Culture drives performance through three channels, explained expects of them.
Hay Group’s Jean-Marc Laouchez:
And alignment has proven results. Hay Group’s research finds
n hared purpose and values – the true heart of culture.
S that organisations with well-aligned cultures show consistently
better results than other companies, with an average five-year
n rganisational messages and reinforcements – role models,
O return on investment that is twice as high and gross profit
organisational design, management systems, brand language. margins that are 27 per cent higher.
©2012 Hay Group. All rights reserved

2. Aligning strategy and culture: Implementing the lessons learned at Hay Group’s 2012 International Conference
Here, we outline the key findings from the International
Conference on how to nurture a high-performance culture
and we suggest ways to implement them successfully in
your organisation.
Align values, messages and
behaviours to drive results
The best organisations ensure they have What you can do now:
a shared, deep purpose and vision that is
understood by all. They establish their values n Evaluate whether your organisation has
– perhaps customer focus, commitment, a shared purpose that goes beyond just
entrepreneurialism or innovation– and achieving financial goals – for instance, does it
clarify the behaviours they want to see. They touch on serving the customer or community?
do not rely simply on words on a poster n Define the values and behaviours that are
to communicate these, but use the right
needed to support the shared purpose – and
catalysts to embed the values and behaviours
identify gaps that need to be closed.
throughout the organisation. Leaders role
model the right behaviours; organisational n Assess whether you have aligned your
design and management systems support performance management system, internal
them; staff are rewarded for demonstrating communications and rewards to foster the
the right behaviours and performing well. behaviours that you want to see.
Case studies: Align values, messages and behaviours to drive results
Johnson Johnson, for example, underlines Kim Hauer of Caterpillar showed how
its customer focus by inviting a customer using leaders as teachers, introducing
(perhaps a doctor, nurse or patient) to talk an annual performance management
about the impact of JJ products on their programme tied closely to results, and
life at the start of meetings. weekly visits from Chairman Doug
Oberhelman to customer sites, shaped
“ A desk is a dangerous place a hands-on and customer-centric focus
from which to view the world
Oberhelman, CEO, Caterpillar
Doug ” ‘from the top.’ This unique culture has
helped Caterpillar drive profits up by
80 per cent.
Caterpillar drive profits up by 80%
©2012 Hay Group. All rights reserved

3. Engage and enable staff
to enhance performance
Staff enablement is about much more than n Develop and communicate a specific
motivation: it is about ensuring employees definition of career development,
have the tools they need to do their job specifying what it means, where it occurs
properly without frustration and that there and the distinctive opportunities for growth
are no significant barriers in their way. Our and development your organisation offers.
research shows that organisations where Outline the responsibilities of individuals,
members of staff are both engaged and managers, and the organisation.
enabled show more than four times the
revenue growth of those in the lowest quartile. n Take a total rewards approach. To help
employees see the balance between
In many organisations, engaged but frustrated contribution and what they get back,
employees suffer in silence, not wanting to be ensure that reward communications
seen as trouble makers; these are the people emphasize the full range of rewards
most likely to jump ship. Many staff surveys focus the organisation offers employees
only on motivation and engagement, looking (both tangible and intangible).
at employees’ desire to go the extra mile, rather
than examining whether the structures they n Provide employees ‘specific freedom to
have in place enable them to do this. It is critical act’, ensuring that they understand which
to investigate both elements. decisions they can and cannot make. When
the scope of decision making is unclear
What you can do now: employees will be disinclined to take risks
or make even simple decisions.
n Determine whether employees are hearing
consistent messages from managers at n Train managers to regularly evaluate
all levels. If middle managers and first- processes, ensuring that roles and work
line supervisors are supportive of senior systems are aligned with present work
executives, they can foster high levels of demands in order to avoid the trap
confidence in the organization’s leadership. of routines.

4. Aligning strategy and culture: Implementing the lessons learned at Hay Group’s 2012 International Conference
Challenge the unwritten rules CRC increased its
to enable transformation turnover by 770%
The most successful leaders have the courage What you can do now:
to confront the ‘unwritten rules’ embedded in n Write down the unwritten rules and interrogate
their corporate culture, and recognise that their usefulness.
the biggest enemy to change often lies within
the company. It takes courage to go deep and
n Identify the leadership mindsets and behaviours
acknowledge the emotional barriers and the that are serving as barriers to transformation.
unhelpful mental models that are getting in n Consider leadership development programmes
the way of progress. to aid top team collaboration.
Case studies: Challenge the unwritten rules to enable transformation
Hay Group’s Wayne Chen and CRC’s Mr Du Christian Majgaard described the unhelpful
Wenmin described the transformation of paradigms that Lego had to confront and
CRC in China from an organisation that the changes it had to go through to rescue
valued personal strength to one that fostered its fortunes after the advent of electronic
organisational capability and strategic games seriously dented its sales: eradicating
thinking. Top leaders worked hard to be more secrecy and forging external alliances;
open and transparent, to develop a common embracing Hollywood (which would
language and to share, collaborate and coach previously have been seen as “making
each other. This has helped CRC increase its contracts with the devil”) and identifying
turnover by 770 per cent since 2000. new distribution channels.
©2012 Hay Group. All rights reserved

5. Embrace diversity
to drive change
A diverse workforce brings enormous value to What you can do now:
an organisation. For companies entering new
markets, having employees who understand n Aim to recruit different people by using
the culture and practices of those countries more objective assessment methodologies
is essential. But, even at home, a workforce that avoid the ‘just like me’ syndrome and
that is diverse in terms of age, experience, show clear links to role requirements.
educational and socio-economic background, n Purposefully put together groups/project
as well as race, culture and gender, will bring teams of people from different backgrounds.
different perspectives that can broaden
horizons and catalyse change. Diversity is n Use diagnostics to see if different groups
challenging for organisations, as we all find it view the organisation/work in different ways,
easier to spend time around people who are then act on the results.
like us – but the rewards are plentiful. n Have facilitators who help teams harness
the varying views of their members – people
with no vested interest in the ‘right’ solution.
Case studies: Embrace diversity to drive change
What gets people out of bed in the morning IBM’s Corporate Service Corps sends teams
is different for different people, noted of 30 people from across the world to
leading business thinker Tamara Erickson. work on month-long projects in Kenya, for
Some thrive on risk and want no two days example, to learn about new key markets
to be the same; others prefer to stay firmly and develop global relationships, said
within their comfort zone. Understanding business expert Anil Gupta. The employer
what excites each employee is key to gains twice: it cultivates high potentials with
mobilising their intelligence and inspiring a global mindset and it aids recruitment by
them to perform. offering one of the most sought-after career
plans in the world.
What gets people out of bed in the morning is
different for different people. Understanding
what excites each employee is key to mobilising
their intelligence and inspiring them to perform.

6. Aligning strategy and culture: Implementing the lessons learned at Hay Group’s 2012 International Conference
Instil a networking culture to foster innovation
Moving away from a command and control culture What you can do now:
towards a networking culture is a journey that pays
dividends, allowing organisations to attract top talent n Check to see if roles and strategic objectives are
and capitalise on employees’ diverse skills. The best clear, while providing freedom to adapt tactics to
organisations welcome ideas from all levels of the changing conditions.
workforce and encourage everyone to contribute. n Examine whether your leaders are pushing
The best leaders, meanwhile, inspire rather than decision making to the lowest levels possible in
order, catalyse rather than command. They have the organisation and encouraging collaboration.
learned that they do not need to have all the n Build processes for two-way communications that
answers; the trick is to ask great questions that
enable leaders to provide vision/direction and
excite employees and unlock their discretionary
listen to ideas/feedback from their employees.
effort. It is also critical to get the ‘piping’ right, by
ensuring you have the physical environment and
frameworks to foster new thinking and collaboration.
Case studies: Instil a networking culture to foster innovation
Anil Gupta pointed out that the People thrive when they are given clear
organisations that are most successful roles and ambiguous tasks, said Tamara,
in emerging markets are the ones with using the example of a BBC news team
firm roots and values but which give their made up of specialists with deep expertise
managers in distant markets the freedom in their own roles. Understanding exactly
and responsibility to make decisions and what they have to do enables them to enter
respond quickly to local conditions. an unknown situation, such as a war zone,
and work together successfully to produce
“ Cut your chains and you become free; cut
”
your roots and you die Anil Gupta
excellent reports.
Five questions to ask yourself now
1 Are you clear about the behaviours that you want to see – should you rethink reward to
support and emphasise these?
2 Are your roles clear and doable – or are overcomplicated structures, insufficient training
or unsupportive colleagues hampering your best talent’s ability to thrive in their role?
3 Are your attempts to change the organisation thwarted by unwritten rules – how can you
help people to reframe their mental models?
4 Do you truly embrace diversity – what could you do to make your workforce more diverse
and encourage healthily disruptive ideas?
5 Are your structures too top-heavy and your leaders too controlling – how can you move
towards a networking, collaborative culture?
Hay Group is a global management consulting firm that works with leaders to transform
strategy into reality and to help people and organisations realise their potential.
To find out more about how Hay Group can help you with these challenges,
visit www.haygroup.com
©2012 Hay Group. All rights reserved