Company culture, enabled by strong leadership, has never been more important to organizations than in the past year as COVID-19 forced drastic changes in the workplace. This leadership, however, was not just that of the people at the top; equally important were the informal leaders in the ranks who embody an organization’s culture, help hold teams together, and motivate people to get things done. As the Polish director and screenwriter Krzysztof Kieślowski once said: “If culture is capable of anything, then it is to find what unites us all.
In some ways, then, it’s somewhat ironic that before the pandemic, people are reporting growing dissatisfaction with their organizational cultures. In our World Cultural Survey 2018, people told us they want the status quo to change, and quickly. Today, it seems that in the face of so much change, people worry and/or mourn the loss of those same work cultures. In PwC’s latest survey of human resources directors, 41% said they feared virtual work would weaken the culture; the main reasons seem to be burnout, lack of confidence and continued uncertainty.
The fact is that there will always be crises. the megatrends and the strategic inflections that are causing leaders to rethink culture will not go away when the pandemic is under control. Organizations will continue to face unprecedented disruption, including the potential for new pandemics, the fight for equality, rapid adoption of technology, climate change, and more. This means employees and leaders will be continually challenged to work and lead in new ways.
Future success requires ongoing changes in “the self-perpetuating patterns of behavior, feeling, thinking, and belief that determine ‘how things get done here’.” This is the definition of culture that we use at Katzenbach Center, the Institute for Culture, Leadership and Teamwork of Strategy&, PwC’s strategy consulting group. So tapping into culture to accelerate the adoption of new skills, work norms, and behaviors that fuel performance is clearly still on the agenda, and with an urgency never seen in the modern age.
Observations and reflections
When it comes to proactive management and changing organizational culture, conventional wisdom might suggest that the “rules” have changed because of the pandemic. On the contrary, we have long espoused that an organization’s culture is deeply rooted and slow to evolve. But rapid change can happen with a focused focus on a few critical behaviors, and the year 2020 has confirmed this in four ways.
Adaptability. During the pandemic, many organizations have demonstrated the ability to transform almost overnight and adopt new behaviors and ways to work very quickly. What was in their cultural DNA that allowed them to do this when other companies struggled? Are there any specific characteristics that have helped certain companies adapt faster and emerge stronger? Can these traits be “bottled up” and replicated in a post-COVID-19 world?
If culture is the organizational fabric that holds people together, has COVID-19 caused tears in that fabric, and if so, how do we fix them?
Team up. COVID-19 has also affected the way we work as a team. At the Katzenbach Center, we have had to rely more than ever on daily interactions within our smallest organizational unit – a “real team” – to stay motivated and understand how to work under stressful conditions. What type of culture best fosters this type of team? How much did having a strong sense of purpose help weather the storm and tap into the pride and emotional engagement that already existed within the culture?
Productivity. Employers talk about the unexpected silver linings of increased productivity levels, faster decision-making and bursts of innovation to meet new customer needs. But will these changes correspond to a lasting change in corporate culture in the longer term? Or will the “old culture,” those deeply ingrained ways of leading and working, quickly catch up and cannibalize these new patterns as the crisis subsides? Without the pandemic putting daily pressure on organizational settings and behaviors, will the inertia inherent in organizational culture see a return to type?
Kindness. In our 2018 organizational culture survey, workers and leaders strongly disagreed about the consistency between how people act on a day-to-day basis and what they say about organizational culture, indicating a gap between words and deeds. More recent surveys show that employees say they are happy with the new flexibility and benevolent responses shown by many employers. Have the events of the past year, with leadership’s emphasis on transparency, communication and benevolence, succeeded in bridging this gap? Has COVID-19 increased trust in employers or weakened it further?
We – and many of our customers – are very curious about all these things. We have therefore launched a 2021 study to find out more. What can the past year teach us about the resilience and adaptability of an organization in the face of crisis? What will be the key levers and actions that will best catalyze behavioral changes in the new normal? If culture is the organizational fabric that holds people together, has COVID-19 caused tears in that fabric, and if so, how do we fix them?
If you would like to contribute to this global study of changing corporate cultures, you can take our survey here. Come back with strategy+Business for more information when we report the results in May.
- Reid Carpenter is the Global Head of the Katzenbach Center, a global institute for organizational culture and leadership at Strategy&, PwC’s strategy consulting business. Based in New York, she is a Managing Director at PwC US.
- Varya Davidson is the Joint Capabilities Lead for Culture, Leadership and Change and a member of the Katzenbach Center’s Global Leadership Team. Based in Sydney, she is a partner at PwC Australia.
- Christophe Hannegan specializes in transformational change and culture and is a member of the US leadership team at the Katzenbach Center. Based in Chicago, he is a director at PwC US.