Organizational Culture by Design Not Default

Greg Honey and Peter Mayne

Farm Credit Canada

CERC Conference 2012

What we’ll cover today

1. What does it mean to have a culture by design?

2. How did FCC go about transforming its culture?

3. How can a positive culture support talent mobility and retention?

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Why does this matter to you?

The mobility, engagement and

loyalty of your employees has the

potential to be a huge competitive

advantage in the age of talentism

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FCC: 100 offices dedicated to agriculture

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We believe that…

A deliberate and positive culture – supported by

the right leadership behaviours – is the key

to creating an unbeatable employee

experience.

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What is culture?

Simple definition: “The way we do things around here.”

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Where do cultures come from?

Culture by default

• Evolves over time

• Based on deeply-held shared assumptions about success

• How people behave and work together “just happens”

• Often originates from values and beliefs of the founder

• May or may not align with current business needs and challenges

Culture by design

• Deliberately created

• Based on a compelling vision of the future

• How people behave and work together is clearly specified

• Often originates from visionary leaders

• Should align with the present and future business needs and challenges

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Have a look at your own culture

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Transforming the culture at Farm Credit Canada

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How it began: the time was right to raise the bar

• FCC had solid

business results

• Visionary CEO

• Increasingly

competitive

business

environment

• Was “good” good

enough?

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Something was getting in the way

Talented,

thoroughbred

VPs focused on

getting great

business

results…

sometimes at

the expense of

people.

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Our people didn’t feel valued

• Low-trust

environment:

employees

shrinking the game

• Short-term results

not sustainable

over the long term

• Leaders focused

purely on results

were blind to their

impact

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The vision

Build a values-based

culture that inspires

employees to work

together to deliver high-

performance results

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The foundation of our culture

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Cultural

Practices

100%

Accountability

Committed

Partnerships

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100% accountability is:

What can I do to make a difference?

How did I contribute to

the breakdown?

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How can I build a better

partnership?

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100% accountability is not:

It’s their

fault. I did my part.

They didn’t do

their part.

My boss never

listens to me!

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What do committed partners do?

• Look for positive intent from others

• Freely give and receive coaching.

• Feel safe to speak up responsibly in

any situation.

• Embrace breakdowns or difficult

conversations

• Seek opportunities to work in

partnership

• Regularly acknowledge others for

their contributions.

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Cultural transformation at a glance

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Senior leadership (2002-2003)

• Transformational change

• Address blind spots at identity level

• Work as one senior team

• Champion the new culture and way of working together (10 Cultural Practices)

Critical Mass (2004-2005)

• Top 20% of organization

• Transformational learning experiences

• New behaviours provide model for teams and build momentum – “my leader is acting differently”

All Employees (2005-06)

• Training for all employees (Holding to Account) led by internal facilitators

• Help them understand and embrace the behaviours related to the Cultural Practices

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Time

Tran

sfo

rmat

ion

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What we learned along the way

1. Culture starts at the top

2. Link to the business – compelling

future

3. Use a coach

4. Make the investment

5. Leaders must walk the talk

6. Actively manage the change

7. Reinforce consistently

Culture isn’t once and done – it’s a “way of being”

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The sustainability challenge

Building a winning culture is a

journey that never ends…

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Supporting talent management and retention

You face some big challenges in your roles

How can a values-based culture by design help you address them?

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An employment brand that balances being “different” with being “consistent”.

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Trust, respect and integrity can be uncommon qualities

• In today’s war for talent, creating an employee experience that clearly sets you apart is a competitive advantage

• Our culture by design is “deliberately different.”

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Consistency is Key Under the top layer of culture, most organizations have dozens or even hundreds of “micro-cultures” -Curt Coffman, First Break All the Rules

Employees tend to leave their supervisor, not the organization - Curt Coffman, First Break All the Rules

What are the implications of this?

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What’s the outcome of all this?

• A competitive advantage based on the way we treat each other and the way we work together.

• Employees say good things about the organization, stay over the long term and strive to do their best.

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The measurable outcome

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FCC Employee Engagement Scores 2003-2012

Engaged employees want to stay at FCC over the long term

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82% of our employees agree or

strongly agree with this statement: “It would take a lot

to get me to leave this organization.”

Voluntary turnover rate at FCC:

5%

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The ultimate payoff: business results

Measure 2002-03 2011-12

Lending portfolio $8.5 billion $23 billion

Net income $97.8 million $459.2 million

Market share 20% 27%

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Questions?

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