Thought-provoking cultural change insights

July 2019

Cultural Change insights

Insync partnered with the Australian HR Institute (AHRI) recently to conduct a survey on key aspects of cultural change in this new post Hayne Royal Commission era. Whilst Insync and AHRI's first report will be released in around 4 or 5 weeks, we offer a sneak preview below of some of the findings. 

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It is not just Financial Services that needs cultural change

One of the preliminary findings of the Insync/AHRI research that involved almost 1,000 responses across different industries, different sized organisations and included perspectives of CEOs, executives and employees showed that it is not only large banks and other financial services organisations that need the sort of cultural change uncovered by the Hayne Royal Commission.

This research showed that professional services, education and training, government and public administration and healthcare and social assistance, among others, also need significant cultural change and, in some respects, need even greater change that the financial services sector.

This finding is likely to shock many Australians as the Hayne Royal Commission has narrowed the focus to banks and other financial services organisations, and what we've seen has shown them in very bad light. These findings do however line up with the anecdotal views of AHRI's experienced HR professional members and Insync's extensive research, including its employee engagement and culture reviews for hundreds of organisations across most industries.

Insync's research shows that financial services organisations, on average, are not much better or worse than organisations in other industries in terms of engaging their employees but they often have a slightly better risk culture, as one would probably expect that they should, than many other commercial industries. This is illustrated by the following chart that shows that financial services industry respondents perceive that their current state is as good or better than those from many other sectors when it comes to responding to the survey item, "Our employees are never encouraged to 'bend the rules' to get a result."

Cultural Change Survey results_bend the rules

Culture eats strategy for breakfast

Overwhelming survey respondents agreed that their organisation's culture is critical to the execution of its strategy. Peter Drucker said, culture eats strategy for breakfast. Some have taken that further to say, organisation culture eats strategy for breakfast, lunch and dinner so don't leave it unattended.

Survey respondents also overwhelmingly agreed that their CEO's and executive's leadership behaviours have a significant impact on their organisation's culture. That should be of no surprise. It also sets a very high bar for the leadership behaviours of CEOs and executives - whether they like it or not.

Our organisation's culture is critical to the successful execution of strategy

Cultural Change Survey results_culture is critical to execution of strategy 

CEO and executive leadership behaviours have a significant impact on our organisation's culture

Cultural Change Survey results_leadership behaviours   


But do employees think that their CEO and executives are living up to the leadership behaviours they expect? To find out, we asked survey respondents several additional questions including whether they thought that their CEO and other leaders regularly talk about ethics and doing the right thing? And if not, what change do they think is required?

The results below show that employees expect leaders to spend much more time talking about ethics and doing the right thing. In the absence of hearing regularly about ethics, and hearing and seeing the adverse consequences of not living up to those ethics, they will rightly think their leaders have much more important priorities.

Our leaders regularly talk about ethics and doing the right thing - WHERE WE ARE

Cultural Change Survey results_ethics now

 

Our leaders regularly talk about ethics and doing the right thing - WHERE WE SHOULD BE

Cultural Change Survey results_ethics future

Some very probing questions

The Cultural Change Survey asked respondents to consider the extent that they agreed with 29 probing survey items, including the following. Their responses to many of these survey items will be included in our upcoming  Insync/AHRI Cultural Change Report.

  • Our organisation never compromises their ethics to achieve short term results
  • Our employees are never encouraged to "bend the rules" to get a result
  • Our organisation doesn't tolerate "mavericks" who cut corners to achieve short term targets
  • Our recruitment processes actively screen our people who we don't think would be ethical and live our values
  • Our organisation's incentive systems don't encourage inappropriate or unethical behaviour
  • Our systems and processes are conducive to ensuring our organisation achieves an ethical culture
  • Customer needs feature prominently in decision making at all levels of our organisation
  • Our organisation makes the best use of its human capital.

Other important report findings

Our Insync/AHRI Cultural Change Report, to be released in late August, will answer the following important questions:

  • Does the size of the organisation impact the extent of cultural change required?
  • Do CEOs, executives and other employees have the same view as to the extent of cultural change required?
  • What percentage of organisations see the need for some cultural change, and of those, what percent see the need for significant cultural change?
  • Do organisations have good measures and a clear description of their current culture and the culture they desire for the future?
  • Do organisations have appropriate plans for cultural change over the next 2 or 3 years?

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