Corporate Culture & Talent: Navigating the New Norms
June 21, 2024 – The keys to unlocking a successful corporate culture are predicated upon how leaders in organizations perceive culture as a top priority. Most senior leaders agree that a healthy company culture is a basic component of any successful organization. It lays the groundwork for strong employee engagement, retention, and performance. In today’s rapidly evolving professional landscape, leaders are also increasingly aware of the role culture plays in driving value at an organization. The last three to five years has heralded a significant shift in how we perceive, embody, and execute the fundamental tenets of corporate culture. Concepts like “cultural fit” have aged out of relevance as companies increasingly understand that psychological safety and building an environment where employees feel empowered to share a diversity of viewpoints helps push organizations into evolving and innovating operations. The adage ‘culture eats strategy for breakfast’ has never rung truer – culture is no longer a mere by-product of employee interactions, but the central axis around which talent and innovation orbit.
Amid digital disruptions like generative AI, a challenging macroeconomic environment, and increased pressure for value creation, in 2024 organizations across the globe have increasingly realized that a strong corporate culture is not an expendable luxury but a foundational asset for sustainable growth. Furthermore, by championing a strong and inclusive culture, not only can organizations attract better talent, they can also retain and optimize their people strategy for the future.
“We recognized very early on that for long-term success, it was essential to work with people who aligned with our values and fit well into our cultural framework,” said Sabine Steiner, COO of Talentor. “A positive culture and thoughtful approach can lead to greater employee satisfaction, increased trust and collaboration, and ultimately better financial performance. By investing in initiatives such as leadership development, cross-cultural exchange, and learning, it creates a work environment that supports better outcomes for everyone.”
Strategies to Suit an Evolving Workplace
Culture isn’t a singular box an organization can check when trying to tackle the initiative. Just as companies must change with the circumstances and technology and trends of their environment, culture must be worked at to support ever growing talent at an organization. “We recognize that workplace culture isn’t static,” said Leslie Loveless, CEO and managing partner of Slone Partners. “Our hiring strategies are built around attracting people who will be culturally additive and strengthen our organization. I don’t subscribe to the theory that recruits need to be a good culture fit because that unnecessarily limits the pool of people we would consider for the role. Instead, we seek to recruit people for our team who will add value through their unique backgrounds, perspectives, and experiences and their capacity to contribute to our culture and make it even better.”
“This philosophy also informs the recruiting strategies we deploy for our client partners,” Ms. Loveless said. “Before we begin a search, we do a deep dive into their organization to gain a thorough understanding of their operations, infrastructure, and culture. With that knowledge we are well positioned to identify and recruit the people we feel would be culturally additive and whose skills, energies, and passions would make the company stronger and more vibrant.”
“Understanding a client’s existing company culture has always been a key component of how we set our strategy,” said Kris McFeely, managing director, executive search of Campbell & Company. “We want to understand what it’s like to work there, how decisions are made, how teams work together, and how success is defined across the organization from as many perspectives as possible. We dive deep with leadership, of course, but also with staff from a variety of levels within the organization so that our understanding of that company’s culture is holistic. However, we don’t talk about candidates as potential ‘fits’ for a culture – that implies we’re only looking for more of the same. We strive to place candidates who will be ‘culture adds’ – bringing something new and energizing to the company culture as it currently exists.”
Cultivating the Ideal Corporate DNA
“At Modern Executive Solutions, we believe culture refers to the mindsets and behaviors of our employees,” said Mark Oppenheimer, CEO. “Further, we believe it is critical that every employee has the tools, skills, resources, and support needed to be successful. We recognize that everyone’s needs are different, and we work hard to make sure that every single employee can bring their best selves to work every day. We approach cultural fit a little differently, though. Instead of asking the typical, ‘does this person fit with our culture?’ question (one that is fraught with inaccuracies and biases) we ask, ‘how can this employee enhance our culture and/or ensure that we are thinking about things differently tomorrow than we are today?’”
“Culture refers to the mindsets and behaviors of our employees,” Mr. Oppenheimer said. “We also believe that we must maintain an equal focus on both performance (serving our clients) and health (how we run our business). By maintaining an equal focus on both, we see numerous positive benefits to the business outcomes that we strive for.”
“We understand that there is a tendency for cultural fit to perpetuate or introduce biases in the workplace,” explained Dara Klarfeld, CEO of DRG Talent. “Seeking a cultural fit often causes hiring teams to connect most with candidates similar to them, decreasing opportunities to identify the leader best fit to meet the organization’s missions and goals. We lead all of our clients through interviewing with reduced bias training to further familiarize them with these tendencies.”
Shaping a Culture of Inclusion
Inclusion, one of the hottest topics in business right now, is not just another buzzword or trend. It is fundamental to delivering on your corporate strategy. Every year Walking the Talks looks at a critical business issue which will impact the creation and management of corporate cultures, talking to C-suite leaders and adding their own perspective as a consultancy focused entirely on culture. Let’s takes a look at this year’s study!
“We identify candidates and future leaders that add to the organization’s values and culture,” Ms. Klarfeld says. “This allows our clients to look more intently at a candidate’s skillset and how they can contribute to the organization’s strategy. This also highlights the diversity of experiences within the candidate pool and allows clients to appreciate how differences in perspective can introduce new ideas to an organization. As we navigate an ever-changing nonprofit world, it’s pertinent that we continue to identify ways to maintain not only an efficient search process, but also, a process that allows candidates to truly highlight their varied experience and fosters growth and healthy change within organizations.”
Building a Culture of Psychological Safety
To have an environment looking for cultural additions, rather than merely cultural “fit” companies must first have a framework of inclusion. Over the past few years, particularly since the pandemic when the topic of workplace trust was brought to the forefront, many employers have focused on building workplace environments in which their employees can feel safe, engaged, inspired, and productive. It is positive workplace culture that now separates the most successful companies from the average ones; a culture of psychological safety increases employee retention, builds engagement among workers, and increases value through productivity and innovation.
“The direct results of this can be seen in the areas of employee engagement and satisfaction, teamwork, and creativity, among others,” explained Justin Clark, COO at TI Verbatim. “Improvements in these areas, in turn, can result in increased employee retention, customer satisfaction, and overall firm productivity, which greatly affect the bottom line of the company. Stressing the importance of company culture as well as cultural fit are essential in realizing these benefits.”
With all the positive outcomes that good culture brings, organizations are looking to find effective ways to not only understand their own unique cultures, but to foster a sense of inclusion and belonging to fully unlock the value of the talent within their organizations.
“Organizations that embrace positive cultural change allow for a more psychologically safe environment for all members of the team, which is a foundation of a healthy organizational culture,” Mr. Clark continued. “Psychological safety allows for a more inclusive work environment where employees can share new perspectives and ideas that might not otherwise be considered, which increases creativity and helps to avoid predictable failures. This helps to change the stigma of failure, instead viewing mistakes as an opportunity for overall growth and enhancement, thereby reducing the number of future repeated failures as well as developing new, more effective processes.”
“Furthermore, it is important to note that the general workforce has experienced and will continue to experience a significant change in demographics as new generations enter the workforce,” Mr. Clark says. “These newer workers desire a culture where they can experience a sense of community and connection as well as a balance between work and personal lives. Organizations that embrace these changes will see positive results in the existing workforce as well as attract new employees who value these ideals, ultimately having a positive effect on the company from a cultural and financial perspective.”
Leveraging Culture for Business Outcomes
While the ‘what’ and ‘how’ of business might draw the initial blueprint, it is the ‘why’ – the cultural ethos that permeates through every task and transaction – which breathes life into corporate strategies. Organizations that have triumphed amidst adversity often attribute their coup to a potent combination of culture and tactical wisdom, where the former acts as the enduring fulcrum for the latter’s execution. “We start by understanding the core values and mission of the company through in-depth discussions with leadership and key stakeholders,” said Tom Wilson, managing director of Gallagher. “This understanding helps us identify the cultural attributes that will support the business’s goals. We then focus on integrating these cultural elements into our recruitment and leadership development processes. By identifying future leaders who not only align with but also complement and enhance the existing culture, we contribute to creating a dynamic environment where diverse perspectives foster innovation and resilience.”
“Moreover, we evaluate how the company’s culture supports its operational and strategic goals,” Mr. Wilson says. “We look for opportunities where a shift or enhancement in culture could lead to better business outcomes, such as improved employee retention, higher customer satisfaction, and greater market competitiveness. Our goal is to ensure that culture acts not just as a backdrop but also as a proactive catalyst for an organization’s success.”
Related: The Importance of Culture on Today’s Businesses
“When it comes to executive search for our private equity clients, cultural fit takes center stage,” said Hang Bower, CEO and founder of Ethos Consulting. “In our experience, PE firms have been and are still focused on cultural fit because of the positive impact to their business when engagement and retention are high. Many firms we work with have rigorous assessments, sometimes one or two specific assessments are chosen and built into their hiring process to ensure a strong cultural match.”
“We have stayed the course focusing on culture alignment with our search and assessment process because understanding the unique culture of each portfolio company within the PE firms helps us effectively match executives whose values, attitudes, standards, decision making skills, communication preferences and working styles align seamlessly,” Mr. Bower says. “On the candidate side, culture fit is important because they usually seek out opportunities for growth and development, challenging work, a sense of worthwhile accomplishment, and a chance to contribute quickly. Other common values candidates seek out are having an environment where they have high respect from their supervisor, ability to laugh at work, flexibility of how they can do their work, high trust from their supervisor (often described as being under the tent), and having their opinion mean something.”
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“Lastly, high salary and good benefits are often mentioned, but almost as table stakes,” Mr. Bower added. “From candidates to PE firms, culture alignment remains paramount to success.”
Building and Sustaining Cultural Transformations
“True, lasting cultural change at an organization has to come from the top,” said Dana Feller, managing partner at Hudson Gate Partners. “There is no other way. It has to be a stated priority of the executive management team, and must also be a topic on every board of directors’ quarterly meeting agenda. Cultural change takes careful thought, honest conversation, and open-mindedness amongst both employees and management,” “An important point: there must be a clear business rationale for making cultural change, because not everyone is going to philosophically agree with whatever the change may be,” Ms. Feller said. “However, if management can explain why making certain cultural changes will enhance the organization’s overall performance and profitability, it will be much easier to gain firmwide consensus. Finally, senior managers should be held accountable for acting as “culture carriers”; this can be done via performance appraisals and via discretionary compensation.”
Hiring for Tomorrow’s Needs
The tides have shifted – while experiences carry the weight of tradition, skills are the harbinger of innovation and adaptability. The marketplace of 2024 demands a revision of our hiring strategies towards a focus on skills and qualities rather than merely similar experience.
“Leading and influencing a diverse group of people and building strong, healthy, cohesive teams are critical skills for today’s workplace,” said Rohan Paul, president of Teamalytics. “The workplace has become more complex in recent years; around hybrid work environments, multi-generational workforce, cultural and political polarization, technology/ AI advancements, and economic uncertainty. Given these complex challenges, leaders must adopt an intentional approach that includes clear vision and collaboration while focusing on becoming better mentors and coaches, fostering unity, and allowing teams to thrive in the face of complexity and uncertainty.”
“It’s paramount for organizations to leverage technology in today’s working world, especially as automation and AI continue to reshape workflows,” explained Ms. Klarfeld. “Adaptability and a willingness to embrace emerging tools are key for organizations to discover potential for future growth and expansion. In post-quarantine years, a shift towards human-centered and values-driven approaches is evident. As organizations continue to navigate remote and hybrid workplaces, it is important to consider how interpersonal relationships play a role in organizational success. Candidates often seek partnerships with organizations that recognize them as a full person beyond their contributions to the organization. Organizations should recognize the importance of empathy and compassion in fostering meaningful connections within internal teams and beyond.”
“Over recent years, these skill requirements have evolved in response to technological advancements, globalization, and shifting societal norms,” Ms. Klarfeld said. “While technical competencies are essential, there is a growing recognition of the importance of soft skills and values alignment in driving organizational success. As we move forward, the ability to adapt, communicate effectively, and uphold ethical principles will continue to define the future workforce.”
Related: How Job Seekers Can Assess Company Culture
Contributed by Scott A. Scanlon, Editor-in-Chief and Dale M. Zupsansky, Executive Editor – Hunt Scanlon Media
