Transcript www.denisonconsulting.com

CULTURE DEVELOPMENT & LEADERSHIP CONSULTING
THOUGHT LEADERSHIP
CULTURE & LEADERSHIP DIAGNOSTICS
CULTURE & LEADERSHIP EVENTS
BUILDING AND SUSTAINING
HIGH PERFORMING ORGANIZATIONS
AND LEADERS
DENISON CERTIFICATION WORKSHOP | MAY 2015
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WORKSHOP SCHEDULE
May 13, 2015
May 14, 2015
NETWORKING BREAKFAST
NETWORKING BREAKFAST
 Welcome and Introductions
 Highlights and re-cap of Day 1
 Culture and leadership
 Transformation & Turnaround
 Denison Model and link to performance
 Strategic Alignment
 Path to High Performance
Culture change business case
 M&A
 Leadership Development
 Wrap-up and Q&A
(Breaks and Lunch provided)
(Breaks and Lunch provided)
GROUP DINNER
CONCLUSION
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HIGHLIGHTS &
RECAP OF DAY 1
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TURNAROUND &
TRANSFORMATION
DENISON PRACTICE AREA
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OVERVIEW
Understand the critical levers to get business back on track!
 Assess current reality by reaching out to internal and external
stakeholders and get a broad and deep perspective of the business
situation
 Generate support for a shared vision for the future to create a
strong coalition
 Execute (with constant follow-up and communication) while
anticipating and managing through the dip as fatigue sets in; and
recognizing extra effort
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PRIVATE EQUITY COMPANIES
WHAT IS THE LINK BETWEEN CULTURE AND PERFORMANCE?
Methodology
Study sample includes...
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Inclusion criteria…
a) Completed a Denison Culture
Survey prior to January 2014
PE Portfolio Companies
103 separate
b) Financial data was available for the
same time period as the Denison
Culture Survey
lines-of-business
(P&Ls)
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GROWTH METRIC
Methodology
3-year rolling averages
Focus on Growth
(Average growth over a 3 year period)
Growth metrics provide an
apples-to-apples point of
comparison within a diverse
sample of companies
representing various industries,
sizes, etc.
Rolling averages provide a stable
estimate:
a) EBITDA Growth*
b) Sales Growth
*Two outliers were excluded from the EBITDA
Growth analysis
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LINK TO GROWTH:
TOP VS. BOTTOM COMPANIES
Bottom Half
Top Half
2.5x
EBITDA
Growth
+5x Sales
Growth
Avg. EBITDA Growth
7%
17%
2.5X
Avg. Sales Growth
-3%
5%
+5X
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LINK TO GROWTH:
PREDICTIVE ANALYSIS
Where should we
stick the crowbar?
Across P&Ls, the Involvement trait was
most strongly and consistently correlated
with EBITDA Growth & Sales Growth
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CULTURE CHANGE OVER TIME
1st Survey
2nd Survey
+ 13 pts. on average from 1st to 2nd culture survey
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BUSINESS CASE
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STRATEGIC ALIGNMENT
DENISON PRACTICE AREA
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OVERVIEW
Align your culture to your business strategy!
 Clarify the ‘collective’ purpose and the tactics across the
organization to develop a clear and aligned workforce at every
level and from every part of the organization
 Foster a shared understanding of your vision, values, strategy and
goals throughout the entire organization
 Help people understand the key organizational priorities and
promote a deep sense of ownership
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ONE ORGANIZATION?
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BUSINESS CASE
Acquisitions
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> Transformation > Alignment
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What would excite you most about integrating Company A? Company B?
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What would concern you most about integrating Company A? Company B?
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CULTURE ALIGNMENT REMAINS A CHALLENGING JOURNEY
In 2013 . . .
The need to:
Define the desired
customer experience
Customer segmentation and
re-organization
Design integrated
processes and systems
Corporate process
improvement team and OSS
efforts, training, and
education
Empower teams to drive
change
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Led to:
Now “teams” reported as
the primary way work gets
done
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IN 2014…
Mission (Vision, Strategy & Goals) are
becoming less clear or being viewed
with skepticism.
Impact in the market is suspect.
Less confidence in our ability to work
effectively across the organization to
create the necessary change.
Employees feeling less valued and skill
deficits are a concern.
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STRATEGIC CLARITY & ALIGNMENT
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MERGERS & ACQUISITIONS
DENISON PRACTICE AREA
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OVERVIEW
Manage culture throughout the M&A process!
 Understand the organization’s current growth strategy and culture
 Conduct pre-deal cultural due diligence
 Plan for smooth transition and successful integration
 Continue high performance culture development
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BUSINESS CASE
“What is your advice for the board?”
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UNDERSTAND YOUR CULTURE FIRST
1
Assess your own culture
2
Define strengths you are trying to build
3
Define the limitations you are trying to overcome
4
Define the ideal culture for your target acquisition
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HIGH
WHAT LEVEL OF INTEGRATION DO WE
NEED?
ABSORPTION
TRANSFORMATION
Degree of change
in target company
Target company
conforms to acquirer
Cultural Assimilation
Both companies find
new ways to operate
Cultural Transformation
BEST OF
BOTH
LOW
Additive from
both sides
Cultural
Integration
PRESERVATION
REVERSE MERGER
Target company
retains independence
Cultural Autonomy
Unusual case of
target firm leading
Cultural Assimilation
LOW
Degree of change
in acquiring company
HIGH
Adapted from Marks and Mirvis (2010)
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CULTURAL DUE DILIGENCE
Social Media
& Public Data
Invasiveness
Low
Data location
External
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External
Stakeholders
HR Data
On-Site
Deal
High
Internal
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HIGH
WHAT LEVEL OF INTEGRATION DO WE
NEED?
ABSORPTION
TRANSFORMATION
Degree of change
in target company
Target company
conforms to acquirer
Cultural Assimilation
LOW
This
Acquisition
Both companies find
new ways to operate
Cultural Transformation
BEST OF
BOTH
Additive from
both sides
Cultural
Integration
PRESERVATION
REVERSE MERGER
Target company
retains independence
Cultural Autonomy
Unusual case of
target firm leading
Cultural Assimilation
LOW
Degree of change
in acquiring company
HIGH
Adapted from Marks and Mirvis (2010)
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SOCIAL MEDIA DATA ANALYSIS
Acquiring Firm
80% recommend as an employer
Target Firm
40% recommend as an employer
Culture
profile
Estimate
Qualitative
Comment
Themes
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Talented and hard-working people
Overall healthy culture
Pay & benefits / Work-life balance
Quality of products
Employee discounts
Unclear future direction
Talent management challenges
Silos
Short-term focus
Leadership challenges
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SOCIAL MEDIA DATA ANALYSIS
Delaware Crate & Barrel
Ikea
Williams-Sonoma Restoration Harward
5
87%
4
71%
55%
3
49%
40%
43%
36%
45%
39%
33%
2
Competitor
Analysis
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Overall
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Culture
Work-life
Sr Mgmt
Compensation
Career
Recommend
as employer
CEO approval
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HR DATA & PREVIOUS SURVEY
HR document
Review
Review of HR documents and data – e.g., employee
handbook, tenure, performance appraisal
Archival
Employee
Survey
Mapping
Conceptual and data mapping based on the comparison
of the archival employee survey vs. the Denison survey
Qualitative
Comment
Analysis
Identification of major themes linked to the Denison Model
based on qualitative analysis of open-ended comments
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HR DATA & PREVIOUS SURVEY
Acquiring Firm
Target Firm
Archival
Employee
Survey
Mapping
Qualitative
Comment
Analysis
Industry
leadership
Innovation
Leadership
Strategy
Products
Customer
Autonomy/
Teamwork/
Collaboration
Culture
Values
Flexibility
Teamwork/
Talent
mgmt
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INTERNAL STAKEHOLDER INTERVIEWS
Semi-structured interviews with the transition Team and leadership
HIGH
 THE END STATE REVISITED
ABSORPTION
TRANSFORMATION
Degree of change
in target company
Target company
conforms to acquirer
Cultural Assimilation
Both companies find
new ways to operate
Cultural Transformation
BEST OF
BOTH
This
Acquisition
Additive from both
sides
Cultural Integration
PRESERVATION
Target’s
REVERSE MERGER
LOW
Target company
expectation
retains independence
Cultural Autonomy
LOW
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Degree of change
in acquiring company
Unusual case of
target firm leading
Cultural Assimilation
HIGH
Adapted from Marks and Mirvis (2010)
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SYNTHESIS: KEY INTEGRATION
CHALLENGES
SYNTHESIS OF ALL DATA SOURCES TO
IDENTIFY:
1. THE POINTS OF SYNERGY

PASSION FOR THE PRODUCTS AND CUSTOMER

STRONG RELATIONSHIPS

DEAL IN-CHARACTER FOR THE ACQUIRING
COMPANY
2. CULTURAL DIFFERENCES

SPEED OF DECISION-MAKING AND OPERATIONS

EMPHASIS ON VALUES AND PEOPLE
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SYNTHESIS: KEY INTEGRATION
CHALLENGES
SYNTHESIS OF ALL DATA SOURCES TO IDENTIFY:
3. KEY INTEGRATION CHALLENGES
 DIFFERENT INTEGRATION EXPECTATIONS
 MANAGEMENT AND ORGANIZATION STRUCTURE
 BRANDING OF RETAIL STORES
 TALENT MANAGEMENT
Create a bridge to the integration process
CULTURAL DUE DILIGENCE
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Deal
Define the target & Reduce the risks
TRANSITION
INTEGRATION
Transition team
to plan
integration
Integration effort
to create
‘one’ business
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LEADERSHIP
DEVELOPMENT
DENISON PRACTICE AREA
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OVERVIEW
Effective leadership is a key driver of performance!
 Establish and articulate direction and clear priorities
 Model the values and behaviors that promote consistency and
alignment across the organization
 Translate the demands of the external environment into action
 Create and manage high-performance organizations and teams
 Cultivate environments that maximize human capital and create
aligned action
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3 FRAMES
Competencies
Culture
3 FRAMES
Competencies
Culture
3 FRAMES
Personality
Competencies
Culture
INTEGRATION OF FRAMES
Personality
Competencies
Culture
• Leader impact on the culture
• Cultural opportunities and constraints [External]
• Leader potential vs. actual performance
• Personal opportunities and constraints [Internal]
• View of Internal and External influences on leader behavior
• Optimize development to maximize impact on the organization
APPLES TO APPLES
Personality
Competencies
Culture
DLPR
DLDS
DOCS
(Denison leadership
Potential Report)
(Denison Leadership
Development 360°
Survey)
(Denison Organizational
Culture Survey)
DENISON LEADERSHIP
DEVELOPMENT SURVEY (DLDS)
ASSESSMENT OF LEADER COMPETENCIES
DENISON LEADERSHIP
DEVELOPMENT SURVEY (DLDS)
 360 tool based on
the Denison model
 96 items
 Benchmarked
against 15,000+
leaders in the
normative database
 Feedback broken out
by rater source
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DENISON LEADERSHIP POTENTIAL
REPORT (DLPR)
ASSESSMENT OF LEADER COMPETENCIES
DLPR

Alignment of Hogan and
Denison scales
 Complete the 3 core Hogan
Personality Assessments

Predicted capabilities or
“potential” on each Denison
index

Benchmarked scoring around
levels of potential

Facilitator’s Guide & Web
Course available
Denison Leadership Potential Report
The Leadership Potential Report
The Leadership Potential Report
Scoring Key
DLPR
Look to the “gaps”
“Negative” scales
“Positive” scales51
INTEGRATION OF 3 FRAMES IN
PRACTICE
DOCS + DLDS + DLPR
INTEGRATION – 4 KEY CONCEPTS
Culture
Personality
Culture Challenge
Culture Strength
Competencies
Leader Challenge
Leader Strength
Challenge
Agent
Understand how the
culture may be constraining
leader development
Equip the leader to be a
champion of positive
culture change
Develop
Flow
Leverage the culture to
benefit the leader’s
development
Build on the existing
strengths of the leader
and culture
Nieminen, Biermeier-Hanson, & Denison (2013), Consulting Psychology Journal: Practice and Research.
Potential
Low
Challenges
High
Realize your
potential to lead
positive culture
change in the
organization
Develop
Leverage the
culture to benefit
your development
as a leader
Culture
Agent
76-99
1-25
76-99
Strengths
Flow
Build on the
synergies of aligned
personal and
organizational
strengths
51-75
Challenge
Agent
Develop
Flow
26-50
Understand how
culture may be
constraining your
development as a
leader
26-50
Strengths
51-75
Challenge
Challenges
1-25
Competencies
Potential
Low
Challenges
High
Realize your
potential to lead
positive culture
change in the
organization
Develop
Leverage the
culture to benefit
your development
as a leader
Culture
Agent
76-99
Agent
X
 Moderate Cultural Challenge
 High Competency Strength
 High Potential
Develop
Flow
* Competencies that fall in this box may
76-99
Strengths
51-75
1-25
Challenge
Flow
Build on the
synergies of aligned
personal and
organizational
strengths
26-50
Strengths
26-50
Understand how
culture may be
constraining your
development as a
leader
51-75
Challenge
Challenges
1-25
Competencies
point to unique opportunities to Lead the
Culture Forward
Potential
Low
Challenges
High
Develop
Leverage the
culture to benefit
your development
as a leader
76-99
Strengths
Agent
 Clear Cultural Challenge
 Moderate Competency Strength
 Low Potential
* Competencies that fall in this box may
be at High Risk of Regression
Develop
Flow
Build on the
synergies of aligned
personal and
organizational
strengths
76-99
1-25
26-50
Realize your
potential to lead
positive culture
change in the
organization
Culture
Agent
Challenge
51-75
Understand how
culture may be
constraining your
development as a
leader
51-75
26-50
Strengths
X
Challenge
Challenges
1-25
Competencies
Flow
Potential
Low
Challenges
High
Competencies
Realize your
potential to lead
positive culture
change in the
organization
Develop
Leverage the
culture to benefit
your development
as a leader
Culture
Agent
1-25
76-99
Strengths
Flow
Build on the
synergies of aligned
personal and
organizational
strengths
51-75
76-99
??
Challenge
Agent
Develop
Flow
26-50
Understand how
culture may be
constraining your
development as a
leader
26-50
51-75
Challenge
Challenges
1-25
Strengths
Potential
Low
Challenges
High
Realize your
potential to lead
positive culture
change in the
organization
Develop
Leverage the
culture to benefit
your development
as a leader
Culture
Agent
76-99
1-25
76-99
Strengths
Flow
Build on the
synergies of aligned
personal and
organizational
strengths
51-75
Challenge
Agent
Develop
Flow
26-50
Understand how
culture may be
constraining your
development as a
leader
26-50
Strengths
51-75
Challenge
Challenges
1-25
Competencies
??
Potential
Low
Challenges
High
Realize your
potential to lead
positive culture
change in the
organization
Develop
Leverage the
culture to benefit
your development
as a leader
Culture
Agent
1-25
Customer
Change
Learning
Values
Develop
Empower
Agreement
Coordinate
Teams
Develop
Vision
Flow
76-99
Strengths
76-99
Agent
Challenge
Flow
Build on the
synergies of aligned
personal and
organizational
strengths
Strengths
26-50
Understand how
culture may be
constraining your
development as a
leader
51-75
26-50
51-75
Challenge
Challenges
1-25
Competencies
Strategy
Goals
Potential
Low
Challenges
High
Competencies
Leverage the
culture to benefit
your development
as a leader
Culture
Develop
1-25
Customer
Challenge
Agreement
Develop
Coordinate
Learning
Develop
Empower
Teams
Flow
Values
Vision
76-99
Strengths
Flow
Build on the
synergies of aligned
personal and
organizational
strengths
Agent
Change
Agent
Realize your
potential to lead
positive culture
change in the
organization
76-99
26-50
Understand how
culture may be
constraining your
development as a
leader
51-75
26-50
51-75
Challenge
Challenges
1-25
Strengths
Strategy
Goals
Low
High
Potential
Composite
Challenges
Competencies Composite
Develop
Leverage the
culture to benefit
your development
as a leader
Flow
Build on the
synergies of aligned
personal and
organizational
strengths
51-75
76-99
1-25
Challenge
Customer
Agent
26-50
Change
Learning
51-75
Realize your
potential to lead
positive culture
change in the
organization
26-50
Empower
Values
Teams
Agreement
Develop
Coordinate
Develop
Vision
Flow
76-99
Agent
Culture Composite
Understand how
culture may be
constraining your
development as a
leader
Strengths
Challenge
Challenges
1-25
Strengths
Strategy
Goals
BUSINESS CASE
“How would you use the Denison tools in designing a
leadership development program?”
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LEADER DEVELOPMENT PROGRAM
DESIGN EXERCISE
• Pair up or Solo: Spend 10 minutes designing a program for Executive
Leaders that builds on what you’ve learned in the Denison
Workshop.
• Design considerations:
•
•
•
•
•
What is the objective of your program?
What kind of feedback do you want to provide to the leaders?
How will you support their use of the feedback?
What tools (Denison and/or non-Denison) would you use?
How would you order and space the activities or steps in the program?
• Tables: Spend 10 minutes sharing/discussing your program.
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Example Leadership Development Program
Culture Project
2014 Q2
6-8 wks
Business
Leaders
Executive
Leaders
4-6 wks
#4
Coaching
Course
Correction
#1
#2
#3
2014 Nov
2015 June
2015 Aug
#2
Workshop
& Coaching
DLDS
2015 May
External
#
Internal
12-16 wks
#3
Coaching
Action
Planning
2015 June
#1
Workshop
& Coaching
DLPR
2014 Nov
#
#5
Coaching
Progress
Review
2015 Dec
2015 Aug
#4
#5
2015 Oct 2015 Dec
Example Leadership Development Program
#1
Workshop
& Coaching
DLPR
#1
Workshop
& Coaching
DLPR
#2
Workshop
& Coaching
DLDS
#3
Coaching
Action
Planning
#4
Coaching
Course
Correction
#5
Coaching
Progress
Review
• Pre-work:
 Hogan Personality Assessments
• Workshop:
 Program kickoff and setting the foundation for personality and potential
 Provide background and interpretation support on DLPR
 Dialogue on composite DLPR results
• Coaching:
 Personalized interpretation support, sense-making, & feedback
 Set honest conversations in motion
 Set draft IDP in motion
Example Leadership Development Program
#1
Workshop
& Coaching
DLPR
#2
Workshop
& Coaching
DLDS
#2
Workshop
& Coaching
DLDS
#3
Coaching
Action
Planning
#4
Coaching
Course
Correction
#5
Coaching
Progress
Review
• Pre-work:
 Denison Leadership Development 360° Survey
• Workshop:
 Setting the foundation for leader actions that create high-performance cultures
 Provide background and interpretation support on 360°
 Dialogue on composite 360° results
• Coaching:
 Personalized interpretation support, sense-making, & feedback
 Set honest conversations in motion
 Look ahead to revision of IDP
Example Leadership Development Program
#1
Workshop
& Coaching
DLPR
#3
Coaching
Action
Planning
#2
Workshop
& Coaching
DLDS
#3
Coaching
Action
Planning
• Pre-work:
 Honest conversations
• Coaching:





Sense-making on the additional feedback
Identify 1-2 priorities for development
Brainstorming actions and ideas
Creating/Modifying the IDP
Setting actions in motion
#4
Coaching
Course
Correction
#5
Coaching
Progress
Review
Example Leadership Development Program
#1
Workshop
& Coaching
DLPR
#4
Coaching
Course
Correction
#2
Workshop
& Coaching
DLDS
#3
Coaching
Action
Planning
#4
Coaching
Course
Correction
• Pre-work:
 Action learning and feedback
• Coaching:




Progress check: What’s working (or not) and how do you know?
Identify obstacles and ongoing support needs
IDP update and adjustment
Sustainment planning
#5
Coaching
Progress
Review
Example Leadership Development Program
#1
Workshop
& Coaching
DLPR
#5
Coaching
Progress
Review
#2
Workshop
& Coaching
DLDS
#3
Coaching
Action
Planning
#4
Coaching
Course
Correction
#5
Coaching
Progress
Review
• Pre-work:
 Action learning and feedback
• Coaching:
 Progress review with Coach & Boss: What has the impact been for you; Where
might you need to rethink and try again?
 Identify obstacles and ongoing support needs
 IDP update and adjustment
 Sustainment planning
WRAP-UP
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YOUR PILOT
25 person Denison
Organizational Culture
Survey
1 Person Leadership
Development Survey
OR
Your pilot package includes the full survey of your choice, full
report generation, and basic interpretation and feedback on
results from a Senior Denison Consultant.
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QUESTIONS?
THANK YOU!
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