Culture and Boards 09 Nov 2018

Some of our staff from Parry Field recently attended an Institute of Directors seminar on the topic of culture and board. These are some key points that emerged that we thought were worth sharing:

• When it comes to culture, Board members will always be looked at - so what culture will they model for those in the organisation?
• Boards have a dual leadership role ensuring accountability (ensuring that purpose and values are kept to) and assurance (ensuring that executive is taking to action to achieve the desired culture.
• Values may be written and put on the wall, with a vision statement and policies - those are visible, but they are just the tip of the iceberg. There are also invisible factors such as the water cooler conversations, the shared myths over what is important and the "unwritten rules". An example is the the myth that Kodak did not innovate enough, when in actual fact they invented the first digital camera well ahead of the game. They commercialised one of the first digital cameras in the 1990s and spent a lot on R&D, but the people at the top of Kodak were 'film' people with 80% market share. So while values did not include profitability, ultimately the unwritten value, the invisible factors, drove the decisions that led to their end.

Reflection

• How well is your culture living and breathing in your organisation? The key is that all of this needs to stay on the radar!
• There are some key elements of culture indicated in the "Johnson and Scholes Cultural web" that include:
  • Stories - who is respected within the organisation? How are the events that occur interpreted?
  • Symbols - for example, who has open plan, who has corner office, who has car park?
  • Rituals and Routines - morning teas, Friday evening drinks etc.
  • Power Structures - who has the power within the organisation (whatever their title)?
  • Organisational Structure - what do informal relationships signal (for example, does the Chair defer to someone else on certain things)?
  • Controls - what is it that controls how things are done in the organisation? An example is asking whether budget and profit are valued over values (which could mean a person simply meets targets but does not model what the organisation stands for).

(More information here).

The real focus and point of this article was to make you aware of visible and invisible factors and the messages that are sent through the key elements set out above. It is important to make sure that values are understood and clearly communicated.