Corporate culture: A fertile yet fragile foundation or how to turn your identity into a powerful lever in the face of adversity

By Olivier Priou and Lorraine Margherita

01/12/2021

Every organization has its own culture, which makes it unique: its origins and history, its management principles, its vision, its common frame of reference, its values, its rituals, its standards, its governance, to name just a few.

These cultural attributes differentiate an organization and catalyze its value creation.

The economic and social situation created by the 2020 health crisis is disrupting the usual functioning of companies, and in particular the interactions that take place within them.

Cultural attributes are both more difficult to preserve in the current context and essential to meeting the challenges of uncertainty and adaptation.

Fundamental changes that are transforming the relationship with the company

Already visible changes

The 2020 crisis has accelerated trends that were already present. 

Recent surveys show the growing importance of the meaning that employees find in their work. Thus, 81% of employees surveyed for the first Professional Resilience Barometer noted a change in their relationship with work during the first lockdown; 45% redefined their priorities.[1] On the management side, 96% of HR Directors who participated in a BCG study believe that the primary role of post-crisis managers will be to give meaning and motivate.[2] Among their concerns, teams expect increased recognition from their management, as shown notably by a Wittyfit survey.[3]

The practice of remote work has significantly increased due to lockdowns and represents a lasting trend for a portion of the teams concerned. This is a situation welcomed by employees, as reflected in several 2020 surveys: ranked among the major priorities[4], increased use of remote work is a desire expressed by 30% in a Wittyfit survey[5], and even an established reality for the future according to 52% of French people.[6] HR leaders have clearly understood this, since 85% of HR Directors surveyed by ANDRH[7] and BCG consider the sustainable development of remote work in their company desirable[8] (while only 39% of executives surveyed by OpinionWay plan to introduce or strengthen remote work[9]). Executive teams have recently evolved their position on the subject, with some even advocating for massive remote work: this is the case of PSA Group, which is continuing its remote work deployment[10] and is preparing to offer it to non-production employees at a rate of 3.5 days per week.[11]

Beyond working conditions, companies will face situations of cultural transition. Societal and environmental expectations are prompting strategic reorientations with more or less immediate implications for their frame of reference. Notable examples include the choice by Maïf, Danone, or CIC of "mission-driven company" status as defined by the Pacte Law.[12] The Airbus, Total, and BP Groups have made highly significant declarations in their sector, promising the design of a hydrogen-powered aircraft by 2035 and increased production of green energy by 2030. These renewed priorities herald numerous challenges in integrating new skills and new ways of doing things into companies with long-established operations.

The risks in these changes

The acceleration of these trends confronts organizations with several types of risks.

First, a risk of disengagement: the distance induced by the crisis extends beyond imposed remote work. Work that was already fragmented is increasingly felt as such, including in service companies. The physical separation of employees compromises their sense of belonging; the workplace loses its convivial and social function, and jeopardizes social bonds. Thus, almost a third (27%) of employees currently say they are "detached from their mission".[13] This is not surprising when considering that work relationships constitute the primary engagement factor (before its content) for private sector employees.[14] For its part, Wittyfit received 30% of responses expressing the wish to return to the workplace to reconnect with colleagues, making it "by far the most cited motivation factor".[15]

Next, a risk to innovation: the current situation disrupts creative processes, particularly through the difficulty of collaborating. Thus, 56% of the 12,000 respondents to a survey on their experience of remote work during lockdown said they were less productive on collaborative tasks.[16] While the possibilities offered by digital tools have been well exploited and recognized for both production and market delivery, physical meetings and the manipulation of objects (models, for example) are perceived as essential to the proper functioning of teams. Furthermore, reduced capacity to solve complex problems is identified as a significant risk by 54% of HR Directors surveyed by ANDRH.[17]

Finally, a risk to the development of skills, knowledge, and beliefs: the strategic reorientations discussed earlier will involve increased collaboration between diverse teams during the transition phase. A challenge for HR professionals who will need more than ever to anticipate the skills acquisition strategy (GPEC) to meet future job requirements. A challenge for CEOs in terms of prioritizing investments and balancing the portfolio of activities.

These developments and risks compromise the performance and viability of companies, even though their culture can enable them to structure customized responses to these challenges.

Responses that engage the cultural mechanisms of the organization at all levels

What avenues of work should be explored in corporate culture to support this transition?

Corporate culture materializes through different attributes such as the level of delegation, contribution to strategic directions, the place of innovation in employees' time, or the perception by employees of the usefulness of their work in achieving the organization's ambitions.

Each company must examine its cultural attributes to shape and adapt the responses provided at the employee, management, and company levels.

The employee level: revisiting the codes around flexibility, trust, and autonomy

Workplace flexibility is among employees' main expectations: 40% of respondents to an international survey want flexibility "on where and when they work".[18] To commit to addressing these concerns, a key avenue focuses on how to create a framework in which everyone contributes to choosing how to carry out their work. This requires creating the conditions for a trusting relationship and genuine transparency between management and teams. While the impetus comes from the top of the organization, best practices, rules and postures to adopt, as well as foundational work, will indeed need to be implemented at the most granular level: operational entities.

Flexibility develops through the relationships employees maintain with their management; the company will also benefit from evaluating changes to bring to its structure, particularly its operating and control rules. Setting the cursor for the level of decentralization and risk management requires mapping the links and interactions that span the entire organization and rethinking their degrees of priority. According to a survey, 87% of HR Directors surveyed by ANDRH believe that employee autonomy will be the primary characteristic of new ways of working.[19]

Flexibility also comes through increased facilitation of employee mobility, not only within the company but also beyond, through tools such as Dynamic Skills Management. Such exchanges enrich practices, foster adaptability, and help employees evolve.

These avenues of work contribute to the notion of well-being, which emerges as a major issue for the company for 81% of employees (25 points higher than 2 years ago).[20]

The management level: restoring meaning to team work

While distance allows employees to concentrate and organize themselves more easily, it limits the intensity and quality of collaborations: so many moments of sharing and rituals to reinvent. Management faces the challenge of creating new spaces and methods for collaboration and therefore creativity. To achieve this, co-construction methods constitute a major lever, giving each team member the opportunity to express their ideas and strengthening the buy-in factor for everyone.

The other challenges, reinforced by distance and greater employee autonomy, lie in the perceived usefulness of individual work. The lengthening of value chains and the breakdown of production schemes have distanced individuals from the final product and the customer, particularly since employees find themselves installed behind their screens. It is up to the manager to build their leadership approach in a way that shares a vision at the team level, with a common goal in which everyone can envision their contribution. This is what fosters engagement. Finally, while autonomy requires letting go, it is not opposed to a need for support that can translate into increased practice of 360° feedback.

Changing environments make building a strategic plan a perilous exercise. Managers are increasingly attempting openness by soliciting contributions from as many people as possible. A relatively new factor that helps rebuild the connection with employees and ensures greater robustness and differentiation in projects.

Innovation, finally. Still too often confined within dedicated teams, "all-out" ideation has already brought benefits to companies that favor a cross-functional approach. For example, the creation of Oppens developed within Société Générale's "Internal Start Up Call" intrapreneurship program, or the now-essential Post-it® invented by an employee during their "personal ideation time" at 3M.[21] Still too marginal, work on culture shows that a long road remains to make it a reflex within teams.

The organizational level: aligning actions with words

After work organization and management: what about the choices of the company as a whole?

A good portion of formal and informal interactions is gradually shifting to more or less official digital platforms. This implies that leadership teams must invest more in these new territories and strengthen their information and communication strategy. At the other end of the spectrum, these technologies make it possible to capture employee expression and then analyze enormous volumes of verbatim comments, to enrich directions adjusted to their situation and aspirations.

Leaders are no longer observed solely on their results, but also on their actions. An APCO study shows that in France, leaders who demonstrated authenticity were perceived as more credible and legitimate.[22] It is by connecting action to words that they foster engagement and therefore performance, especially in turbulent times.

The approach previously focused on stakeholders (which includes employees) is producing results: some companies are committing more quickly than others to the path of transparency in particular, by relying on their culture. Those who have not yet taken this path will increasingly feel pressure from their ecosystem to commit in turn to the path taken notably by mission-driven companies. Investors are increasingly sensitive to societal and environmental performance criteria, beyond purely financial criteria; this is demonstrated by the example of SFIL, which produced its first "green" bond issue[23], or the creation of extra-financial rating agencies such as Vigeo Eiris or Sustainalytics.

So many codes, frameworks, and standards in development that are gradually integrating the landscape to varying degrees across all sectors of the economy.

In 2020, observations about ways of working align with those prompted by observing organizational culture: it will be more difficult to establish the right conditions for working together, and making this a priority will constitute precisely the best guarantee of mobilization and performance for our organizations.

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[1] "Professional Resilience Barometer", Envie2résilience in partnership with Moodwork (May 1-June 22, 2020, workers from public service, business and civil society).

[2] ANDRH/BCG survey "Covid: the future of work as seen by HR Directors" (450 people in France, June 2020).

[3] Survey "Employees' perspective in times of crisis" by Ifop for Wittyfit and Siaci Saint Honoré (1,000 people in France, May 2020).

[4] Salesforce global study "Global Campaign Stakeholder Series, Future of Work" (20,000 people, 10 countries including France, October 2019-June 2020).

[5] Survey "Employees' perspective in times of crisis" by Ifop for Wittyfit and Siaci Saint Honoré.

[6] Salesforce global study "Global Campaign Stakeholder Series, Future of Work".

[7] National Association of HR Directors

[8] ANDRH / BCG survey "Covid: the future of work as seen by HR Directors".

[9] Survey "Supporting business transformation" commissioned by Eleas, Procadres International and Vivant Avocats, conducted by OpinionWay (September 2020, 214 company executives and 37 HR Directors)

[10] PSA press release, October 10, 2017, "Remote work: already 10,000 PSA Group employees engaged!" [11] "PSA will generalize remote work from the start of the school year", Les Echos, July 15, 2020; "How PSA maintains the course of massive remote work for 40,000 employees", Les Echos, October 22, 2020. [12] Law of May 22, 2019 on business growth and transformation ("Pacte law"), article 176.

[13] Wittyfit survey "Employees' perspective in times of crisis".

[14] "12th Absenteeism and Engagement Barometer", 2020 study conducted by Ayming in partnership with AG2R La Mondiale and Kantar TNS (quantitative analysis of 45,403 companies and qualitative analysis of 1,000 employees; absenteeism data in France in 2019.)

[15] Survey "Employees' perspective in times of crisis" by Ifop for Wittyfit and Siaci Saint Honoré.

[16] BCG survey "COVID-19 Employee Sentiment Survey" (12,000 people in the USA, Germany, India, August 2020).

[17] ANDRH/BCG study "Covid: the future of work as seen by HR Directors".

[18] BCG survey "COVID-19 Employee Sentiment Survey".

[19] ANDRH/BCG study "Covid: the future of work as seen by HR Directors".

[20] Survey "Employees' perspective in times of crisis" by Ifop for Wittyfit and Siaci Saint Honoré.

[21] "3M's 15% Culture", https://www.3m.co.uk/3M/en_GB/careers/culture/15-percent-culture.

[22] APCO Worldwide Paris study, "Communication by CAC 40 leaders in the time of coronavirus" (January 23-April 24, published May 2020, qualitative analysis of CAC 40 leaders' public statements and quantitative study of public data and articles).

[23] SFIL press release, November 5, 2019: https://caissefrancaisedefinancementlocal.fr/grand-succes-de-lemission-inaugurale-verte-du-groupe-sfil/