Three Ways Your Corporate Can Start Developing A More Agile Work Culture
It's also important for CEOs to see what obstacles employees think are holding their organization back, because they might be vastly different from what the senior leadership think they are.
For decades, many of the world's largest corporations have monopolized a large share of their respective markets. However, recently, the internet and social media have become agents of democratization, and have led to the emergence of thousands of startups that are quickly chipping away at the market share of these larger companies. This new global startup ecosystem, increasingly led by young people, has completely changed the world of business.
On McKinsey's Inside the Strategy Room podcast, Julie Bashkin, a senior McKinsey adviser based in New York, talked about corporates' initial attitudes towards startups when they first started to surface. "Five years ago, [corporates] were thinking, "Startups? Who? We don't care about them.' And now they're calling it the "bee swarm,' or sometimes, they call them "ankle biters'… They seem to have come out of nowhere, and they seem to be moving fast with no resources." Now, more than ever, it's crucial for large corporations and their employees to adapt to the fast pace of our global business ecosystem by adopting more entrepreneurial mindsets. However, unlike Hollywood's dramatic portrayals, this agility doesn't have to be achieved through a brutal merger or acquisitionit can be achieved by transforming the work culture of a corporation.
Here are three things that CEOs can do to make their organizations function more like a startup:
1/ Invest in establishing clear and holistic work cultures
The era of the factory worker is no more. In today's global economy, hiring employees with a "cog in the machine" mentality will only hurt an organization's growth, because the challenges that companies face nowadays are constantly evolving. Therefore, employees need to be able to be more creative and proactive about the way they approach their work and the obstacles they face on a day-to-day basis.
To achieve this level of dynamism, not only do HR personnel in corporations have to recruit more entrepreneurial people, but they also need to train existing employees on how they can become more intrapreneurial. That being said, injecting an entrepreneurial attitude in corporations isn't as clear cut as it might seem. Although throwing money at the problem might seem like the most expedient solution to solving the problem, it isn't. A Gartner 2017 poll found that despite corporations' increasing efforts to invest in culture, "only one-third of organizations have the culture they actually need to drive future business performance." In order to build work cultures that actually perform, organizations need to "align the workforce with the culture by improving the knowledge, mindset, and behavior simultaneously, and for the entire workforce."
In other words, all of a corporation's employees have to understand what their leadership expects of them. They also have to believe that the culture that the organization's leadership has put in place will actually lead their organization to success, and they have to be committed to upholding it. Last but not the least, they have to use the principles and values outlined by their corporate culture to govern the way they work, approach troubleshooting, and resolve conflict.
By putting equal emphasis on knowledge, mindset, and behavior during the recruitment process and professional development, HR personnel in corporations should be able to empower their employees to become more confident decision-makers and problemsolvers, which will inevitably result in more creative thinking, experimentation, and collaboration throughout the organization.
2/ Understand obstacles deterring you from achieving your desired work culture
According to Gartner's Three Culture Conversations Every CEO Must Have With the Head of HR report, many CEOs believe that their problem is "rooted in figuring out the type of culture their organization needs, so they [can] set out to find -or institute- the relevant cultural attribute or attributes." When most people think about startup culture, they think relaxed. They imagine a bunch of casually-dressed employees brainstorming in a bean bag circle, and young CEOs working at a standing desk sipping a kale smoothie and eating edamame and quinoa salad. While this might be an example of a less structured work environment, it's not necessarily an example of a more efficient or productive work culture. In fact, focusing on innovation, performance, and collaboration in isolation doesn't guarantee an improvement in corporations' performance in relation to their financial goals, according to the Gartner 2017 Culture Benchmarking Survey.
So, what actually improves an organization's performance? Establishing a work culture that promotes real productivity isn't just about introducing Skittles to the break room, or allowing employees to wear sneakers in the office. It's not about hyper-focusing on a buzzword, like artificial intelligence (AI) or blockchain, to give the semblance of being a modern organization either. It's instead about understanding what the pain points of your corporation are, and giving employees clear standard operating procedures that they can use when they encounter unexpected problems and opportunities. When corporations struggle to reach their desired culture, it's usually because their vision of how to get there is unclear, or their understanding of their organization's pain points is incorrect. In either case, CEOs need to sit down with their senior executives to get a clear understanding of why their cultural goal has not been met. It's also important for CEOs to see what obstacles employees think are holding their organization back, because they might be vastly different from what the senior leadership think they are.
3/ Collaborate with startups to boost your productivity
There are many fallacies in the world of business. For example, in order for your company to succeed, you have to be the first to market, or that you have to outdo your competition every time. However, no matter how big or small your company is, or how many resources you have, you can't do everything, you can't excel at everything, and the great news is that you don't have to. Another unfortunate fallacy that exists in the business world is that corporates and startups have to be sworn enemies, but nothing could be further from the truth.
In this article, I've talked extensively about what companies can do to think and operate more like startups, but why reinvent the wheel? We live in exciting times where startups and companies are constantly reimaging the way we do business, and that's why more corporations are choosing to partner with startups to improve different aspects of their work culture and performance. Nevertheless, in order for a corporate-startup partnership to be sustainable in the long-term, it must be beneficial for both parties. So, what can a corporate offer a startup that's helping it develop more entrepreneurial work cultures and employees? The most obvious answer is funding; however, money isn't the only thing that startups need to survive and thrive. More often than not, startup founders need access to work spaces, financial education, legal advice, mentorship, expensive machinery, and so much more! As more corporations and startups start to collaborate, they will soon discover that in many ways they complement each other, because each party has some kind of added value to offer the other. If you really think about it, there's nothing new about this idea. If we had to sum it up in one word, it would be outsourcing. Why struggle to do something when you can outsource it to someone else? After all, that's how our global societies have grown and developed. By outsourcing farming, building, and many other things, we've been able to fully dedicate ourselves to other pursuits. So, why should it be any different in our global business ecosystem?
In the future, building resilient workforces and work cultures will require startups and corporates to work together in order to innovate more effectively. With that in mind, I believe that it's necessary for more corporations to start establishing more avenues to collaborate with entrepreneurs in the world's burgeoning startup ecosystem. Many organizations are already trying to lay the groundwork for this new collaborative economy by hosting hackathons, establishing startup funding competitions, creating innovation labs, and much, much more. However, in order to ensure the sustainability and longevity of these budding partnerships, it will also be necessary for corporates to create departments within their organizations to seek out new collaboration opportunities, and follow up on existing ones. This is only the beginning of a new and exciting era of business collaboration. Soon, we'll have more and more corporations thinking like startups, and more and more startups becoming corporations, thus creating an increasingly diverse and strong global business ecosystem.