Rewards and punishments

If you always do what you’ve always done, you’ll always get what you’ve always gotten. In culture change efforts, leaders need to direct that adage inward more often than they direct it toward those who work within the organization. People generally act exactly in response to what they are rewarded and punished for. Change that,…

Much is written about organizational culture. I think we often over-complexify it. Simply put, culture in any organization is the output of what we reward and punish. In other words, people tend to do what we reward and avoid what we punish. And when I say reward, I don’t necessarily mean with gift cards and promotions. And when we talk about punishment, that is not limited to demotions or terminations.

A reward can be as simple as a thank you or a nod of approval — and a punishment as simple as a frown. We discern how to act, what to do and what to say based on the multitude of these cues that exist all around us, all the time. We determine these actions by the stories and myths that we tell ourselves about our organization.

“Remember that time the vice president yelled at Bob for being late to that meeting?” This particular punishment, and the subsequent story that follows it, informs everyone in the company that you better not be late for meetings around here. If leaders consistently berate people for being late, soon a cultural attribute is born. A visitor may observe sometime later that this culture is “punctual” and wonder how they achieved such a feat. Given this dynamic, it is interesting to me that we spend so much time trying to figure out “culture change” and so little time simply looking at what we reward and punish.

I once worked with an HR organization that wanted to change their culture from largely transactional to one of strategic business partnership. That is a fair enough goal. And yet, they went about this endeavor without thinking about why they became a transactional organization in the first place. A cursory investigation of how this came to be revealed that they were transactional because those were the behaviors that they historically rewarded and valued.

Who was promoted in the organization? People who could produce stuff quickly and accurately when told to do so. How might this HR organization change its culture to a more strategic posture? Simple. Promote people who work and act strategically. It makes little sense to change the title of an HR generalist to “strategic business partner” if you’re still rewarding tactical behavior. Giving people a different name doesn’t change how people behave. It makes little sense to think that training people to be a strategic business partner will change your culture if you still only reward people who are tactical.

This all seems pretty elementary, and one wonders why a whole culture change industry is even necessary. And yet, it does seem to be necessary because organizations don’t willingly or easily change their cultures. The reason for this is that people don’t like to change. “Well, of course!” you say. This is obvious. But the focus of getting people to change and of change efforts is almost always misdirected toward the people who do the work and not to the real resistors of change: the leaders.

Leaders reach their positions because they are good at navigating the culture in which they work. In a culture that rewards tactical behavior, tactical people get promoted. Tactical people tend to value tactical stuff, and so they promote other tactical people. Why would we expect people who value tactical stuff to promote strategic people? Why would we expect leaders — whose value in the organization is predicated on their ability to navigate a tactical landscape — to want to change that landscape to a strategic one where their abilities and skills are devalued? They usually won’t.

And this is the crux of the issue: If a leader’s position, perceived self-worth and value in the organization is predicated on the skills they developed in navigating the current culture, they will not be inclined to change that culture to one where they perceive themselves to be of less value. In other words, if I got to my position because I am good at playing office politics, then why would I want to get rid of office politics? This is a pernicious problem and the real reason why so many change efforts fail.

I said earlier that it is interesting that so many organizations fail to purposefully look at what they reward and punish when engaged in cultural change efforts. It is interesting, but as we’ve seen, not surprising. Change efforts are almost always directed downward. Leaders think, “If we could only change how our people act, then we’d have a better culture.” But the real barrier to change is how the leaders themselves act. The real barrier is what they reward, what they punish and what they value. The real barrier is the very real fear leaders feel in addressing behaviors that they themselves actively engage in and are good at — the things that they think make them valuable.

If you want to change the culture of your organization, the first step you should always take is to clearly identify the cultural attribute you are trying to change. Do your people act too tactically? Do leaders over-function? Are people passive and always waiting for orders? Next, do a purposeful inventory of what the organization rewards, punishes and values that drives these behaviors. And then do some serious introspection into the role you and other leaders may play in creating it.

Ask yourself, what do I value? What do I reward? What do I punish? How does my perceived value to the organization hinge on being good at what we currently reward? And, most important, what do I have to learn or unlearn to begin changing what I value, reward and punish? In other words, how can I reshape myself to be valuable in a different kind of culture? Most definitely do not ask, how can I change those people down there? After all, whether you realize it or not, the leaders are the ones who created the culture in the first place.

If you always do what you’ve always done, you’ll always get what you’ve always gotten — or so the saying goes. In culture change efforts, leaders need to direct that adage toward themselves more often than they direct it to those who work within the organization. People generally act exactly in response to what they are rewarded and punished for. Change that, and you may have a chance at changing your culture.