Welcome to The Culture Kit with Jenny & Sameer!

In this inaugural episode, hosts Jenny Chatman and Sameer Srivastava answer a question from Steve Brass, CEO of WD-40, about how to create and maintain a strong workplace culture.

What does it mean to have a strong culture? According to Jenny:

A strong organizational culture is one where people both agree about what’s important and care. And so if you think about in your head a two-by-two box here, which is what academics love to think in terms of, you have one with agreement, low-high, one with intensity, low-high. If you’re high on both, you have a strong culture. If you’re low on both, you have a weak culture. But if you’re high on agreement but low on intensity, you have what we call a vacuous culture. Everybody agrees, but nobody cares. And you could be high on intensity but low on agreement, and there you’ll probably have a lot of conflict, or what we call warring factions. So those are the possibilities for how strong culture can array.

Jenny and Sameer also discuss the dark side of strong culture. Sameer says:

I think it’s also important to keep in mind that strong cultures can also have a dark side, and an organization with a culture that is too strong can quickly become stifling and fail to recognize the value and importance of non-conformists who are often really central to efforts to innovate and change the culture over time. In fact, if an organization’s culture becomes too strong, it can actually take on the qualities of a cult. And so there’s a risk of having a culture that may be just too strong.

The two also discuss Jenny’s take on Netflix and Genentech’s cultures, and how leaders even know how strong their culture is.

Do you have a vexing question about work that you want Jenny and Sameer to answer? Submit your “Fixit Ticket!”

The Culture Kit with Jenny & Sameer is a production of Haas School of Business and is produced by University FM.

Jenny & Sameer’s Three Main Takeaways

  1. Define: Understand what a strong culture is and its purpose.
  2. Assess: Understand how to assess and track it over time so you know if there are gaps between what your current culture emphasizes and what you need to be emphasizing strategically.
  3. Reinforce: Recognize that culture needs to be consistent and comprehensive so that people believe it’s real and are willing to support it.

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Episode 1 Transcript

[00:00:00] Jenny: Hi, I’m Jenny Chatman.

[00:00:05] Sameer: And I’m Sameer Srivastava.

[00:00:06] Jenny: We’re professors at UC Berkeley’s Haas School of Business, and we’ve dedicated our careers to studying and advancing effective workplace cultures.

[00:00:15] Sameer: Jenny is a psychologist who helped create the field of organizational culture research.

[00:00:20] Jenny: And Sameer is a sociologist who’s pioneering new ways to use big data, AI, and deep learning to uncover insights about what happens inside organizations.

[00:00:34] Sameer: Together, we founded the Berkeley Center for Workplace Culture and Innovation to help business leaders create and cultivate healthy and effective workplace cultures.

[00:00:43] Jenny: In this podcast, we’ll tackle hard-to-fix issues that your organization is facing, as we look to the future of work.

[00:00:51] Sameer: We’ll take your questions about culture and give you practical advice that you can put to work right away. Join us for the Culture Kit, with Jenny and Sameer, and start building your culture toolkit.

[00:01:05] Jenny: Hey, Sameer, what are you most excited about for our new podcast?

[00:01:08] Sameer: Well, Jenny, it’s pretty hard to believe that it was about six years ago that we founded together the Berkeley Center for Workplace Culture and Innovation. And what I’m really excited about is expanding the reach of the work we’ve been doing through a new medium. And I’m especially excited about helping business leaders solve some of the real problems that they’ve been facing.

How about you, Jenny?

[00:01:27] Jenny: Well, I’m excited about the format that we’re going to use for the podcast. In each episode, we’re going to use research-based insights to answer a question that an organizational leader is struggling with today.

[00:01:40] Sameer: And let’s go ahead and start that process by thinking about the very first question we’ve received, which comes to us from Steve Brass, the CEO of WD-40.

[00:01:50] Jenny: I mean, WD-40 is a super interesting company. It’s a really well-known product around the world. The company’s been around since 1953. And my husband, a contractor, Russell, it’s his favorite product on earth because it works for so many different things. Our garage is full of WD-40.

[00:02:11] Sameer: Even though I may be the least handy person on the planet, I also managed to have some WD-40 around in my garage.

[00:02:17] Jenny: Nice, let’s hear Steve’s question.

[00:02:19] Steve Brass: Hi, I’m Steve Brass, and I’m CEO at WD-40 Company. My question is, once you’ve developed a strong, successful company culture, what’s the key to keeping it strong over time? How do you ensure you have continuity while also making sure you’re adaptive in this fast-changing world of ours?

[00:02:37] Sameer: So, Jenny, before we tackle Steve’s question, I want to hear your take on strong culture. What does that term even mean to you?

[00:02:47] Jenny: Yeah, good question, Sameer. People always ask me to define culture. And here’s a, kind of, textbook definition. Culture is a pattern of beliefs and expectations that people share and that produce behavioral norms—norms that actually shape what people do.

So, what are behavioral norms? Behavioral norms are things like eye contact, right? In some cultures, giving very, very attentive eye contact, literally looking straight at someone, is considered polite, and it would be impolite to look away; whereas, in other cultures, and you can think about this across nations… in other cultures, having direct eye contact would be considered rude and overly invasive.

So, norms are these, kind of, unwritten rules that we have that really dictate what’s appropriate in a particular situation. And what our research has shown is that there are really three parts to norms. There’s the, kind of, content or substance of norms. Like, do we care about being innovative or taking risks? But there are also two parts of norms that have to do with how strong those norms are. One is, do people agree about what’s important? And second is, do they care, or what’s the intensity around those norms?

A strong organizational culture is one where people both agree about what’s important and they care. And so, if you think about in your head a, kind of, two-by-two box here, which is what academics love to think in terms of, you have one with agreement, low high, one with intensity, low high. If you’re high on both, you have a strong culture. If you’re low on both, you have a weak culture. But if you’re high on agreement but low on intensity, you have what we call a vacuous culture. Everybody agrees, but nobody cares. And you could be high on intensity but low on agreement, and there you’ll probably have a lot of conflict, or what we call warring factions. So, those are the possibilities for how strong culture can array.

[00:04:58] Sameer: And Jenny, what are some of the benefits of having a strong culture?

[00:05:02] Jenny: Yeah, another great question. Think, for example, about an organization where being on time and on-budget is both important. Well, ultimately, the culture should help you understand which one of those to prioritize in particular situations.

A strong culture, also, kind of, finally provides evidence to members of the organization that you’re really serious about the culture, that it is consistent and comprehensive, and people agree about the culture throughout the organization.

[00:05:34] Sameer: Totally makes sense, Jenny. But I think it’s also important to keep in mind that strong cultures can also have a dark side. And an organization with a culture that is too strong can quickly become stifling and fail to recognize the value and importance of non-conformists who are often really central to efforts to innovate and change the culture over time.

In fact, if an organization’s culture becomes too strong, it can actually take on the qualities of a cult. And so, there’s a risk of having a culture that may be just too strong.

[00:06:09] Jenny: Yeah, you’re so right about that. There’s even research that compares really strong culture organizations to cults. And you don’t want that to happen because you have an inward focus and you can become inert very quickly. So, Sameer, how do leaders even know how strong their culture is?

[00:06:25] Sameer: Well, there are lots of great tools for assessing organizational culture, and there have been some really exciting new developments in the last several years for measuring culture. But I want to start by talking about one of the most tried and true methods available, which is simply observing people and groups at work—the old classic management by walking around, or more formally, ethnographies of organizations.

These are incredibly revealing about how people are actually engaging with each other, deriving meaning, what symbols and artifacts have value in the organization and what they represent. And even some of the most sophisticated, technologically advanced companies out there like Apple routinely engage ethnographers to help them better understand their culture.

But perhaps, the workhorse tool of culture assessment is the self-report or the survey instrument. And Jenny, of course, you’ve developed what I think of as the gold standard in this category, the organizational culture profile.

[00:07:25] Jenny: Oh, do continue.

[00:07:26] Sameer: So, tools such as the organizational culture profile can help leaders, not only understand the dimensions of culture, like adaptability or inclusiveness, that best characterize what’s happening, but also how much agreement and what the strength of that culture is.

[00:07:40] Jenny: Well, and, you know, Sameer, we did that, because for so long, leaders had no quantitative tools for actually doing a systematic analysis of their culture.

[00:07:52] Sameer: And of course, in recent years, we’ve seen the development of a complementary approach to measuring culture, which is the use of digital trace data, the kind that organizations have lying around everywhere, things like Slack messages, e-mail communications, Zoom meetings, all of which contain data about the natural language which people are communicating with each other. And with the advent of computational methods and natural language processing techniques, we can now extract cultural signal out of these data.

This is the work I’ve been doing for the last several years, together with Amir Goldberg from Stanford and, and many others. So, finally, whereas, each of these different approaches can give you a window into a slice of your culture, the real value comes from being able to triangulate across these different data sources in the way that you, Amir, and I did, Jenny, in a recent paper.

[00:08:44] Jenny: You’re right, Sameer. It’s such an exciting time to be doing culture research. There are all these great tools out there.

[00:08:50] Sameer: So, Jenny, we’ve now talked about a number of preliminary topics related to Steve’s question, but we haven’t really tackled Steve’s question yet. So, let me ask you again, how do leaders not only establish, but really reinforce a strong culture over time?

[00:09:05] Jenny: Yeah, that’s the key question, isn’t it? So, first, leaders need to make sure that the culture they cultivate is strategically relevant. What does that mean? That means that they’re helping people prioritize the very behaviors that are needed to get them across the finish line strategically.

Let me give you an example. And this is an example that so many people have heard and think about with regard to strong culture. Southwest Airlines. Southwest Airlines’ strategy, super obvious, is high efficiency, low cost. What’s a culture that’s going to work for delivering on that strategy? Well, urgency and speed really, really helps. And specifically, Southwest is able to turn their planes in 20 minutes versus the industry average of 45 minutes, right? If you turn the planes faster, your utilization rates go up, your ability to be on time goes up, and you save money. And what this means is that employees have a very unique way of selflessly coordinating, even though the level of unionization is quite high in Southwest.

[00:10:16] Sameer: That sounds like a great example of a culture that gives the company a strategic advantage. How else can a company keep its culture strong?

[00:10:24] Jenny: The second thing is you want to make it consistent and comprehensive, that is, to build the culture into everything that you do. Here’s another example, Genentech, the pharmaceutical company. Obviously, it’s key for people to focus on patients. And at one point in time, Genentech was worried that people were, kind of, losing that focus a little bit, not because they wanted to, but because other things were taking priority, like short-term financial results.

So, Genentech made two very small changes. And I think this is so interesting because we often think about culture change as taking forever and being so difficult. These were high-potency changes that Genentech put in place. And they were so simple that they almost sound laughably obvious.

The first thing that they did was they asked people to start every meeting with a patient testimonial, not a long one, but just something about how a patient had benefited from the medicines that Genentech produced.

And the second one–also pretty simple–was rather than accounting for and labeling what they were selling as vials, so the number of vials that we sold, they instead relabeled that to call it the number of patients that we helped. And that’s the metric that they used to calculate everything that they were doing.

[00:11:57] Sameer: So, Jenny, I was going to ask you, if you wouldn’t mind, commenting a bit on Netflix. Netflix gets talked about a lot. What’s your take on their culture?

[00:12:04] Jenny: Well, Netflix is really interesting. Their business strategy actually appears to relate to their people strategy. And when you look at Netflix, there’s a very strong culture around hiring and retaining stars in every position. They have something called the keeper test, which basically is a test to see that every person you have in every position is a star, and if they’re not, give them a severance and replace them with a star.

Why would they care so much about that? Well, you can think about Netflix compared to one of their industry competitors, Disney. Netflix has roughly the same, actually slightly higher market cap than Disney, but they’re able to achieve that market cap with only 7% of the number of people that Disney has.

So, Netflix has about 13,000 people. Disney has about 188,000 people for about the same market cap. So, now you come back and you see this keeper test, a cultural imperative is really part of Netflix’ strategy.

So, Sameer, this has been a lovely conversation. What would you say are the key takeaways for our listeners?

[00:13:21] Sameer: I think we can summarize things in three words—define, assess, and reinforce. Define the behaviors that are most strategically relevant for the organization, and then build a strong culture around that. Assess the culture using the range of methods available to you, including both qualitative and quantitative, and make sure that your culture remains strong over time. But then, finally, reinforce the behaviors you really care about through the range of levers available to you, because cultures will otherwise tend to drift.

[00:13:55] Jenny: I like that, define, assess, reinforce.

Hey, let’s thank Steve Brass, CEO at WD-40, for his fabulous question. I hope he got some insights from our conversation.

And that’s it. We did it, our first podcast. This is going to be really fun.

[00:14:13] Sameer: Super exciting. I’m really looking forward to our next one.

[00:14:17] Jenny: Thanks for listening to the Culture Kit with Jenny and Sameer. Do you have a question about work that you want us to answer? Go to haas.org/culture-kit to submit your fix-it ticket today.

[00:14:30] Sameer: The Culture Kit Podcast is a production of the Berkeley Center for Workplace Culture and Innovation at the Haas School of Business, and it’s produced by University FM. If you enjoyed the show, be sure to hit that Subscribe button, leave us a review, and share this episode online, so others who have workplace culture questions can find us, too.

[00:14:50] Jenny: I’m Jenny.

[00:14:51] Sameer: And I’m Sameer.

[00:14:52] Jenny: We’ll be back soon with more tools to help fix your work culture challenges.

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