It’s no wonder “culture officer” is making its way into the business lexicon. Last year, Merriam-Webster announced that “culture” was a 2014 word of the year, and a 2014 global survey of nearly 1,200 C-suite executives by McKinsey & Co. found that spending time on culture was a key priority for those who successfully moved to the C-suite.
Innovative companies such as Google and Zappos have had their own versions of a chief culture officer for years, and now smaller organizations are getting in on the act.
“The building, managing and merging of cultures has become a full-time job in the new economy,” according to culture expert Debbie Robins. “These demands now exceed the capacities of most HR divisions and call for a new kind of specialist.” That may be someone external (a culture expert) or internal (a chief culture officer) who works with companies of all sizes to manage culture and ensure positive growth, she explains.
Businesses that appoint someone to focus on culture often do so following periods of rapid growth, after a merger or acquisition to ensure consistency throughout the new organization, or to support a change in business strategy.
Some culture officers work within the HR function, while others report directly to the CEO. A core duty of the role involves developing strategies to ensure that HR initiatives and programs—such as recruitment, onboarding, team-building and recognition—reinforce the company’s culture and values.
Charles A. O’Reilly III, a professor of management at the Stanford Graduate School of Business, points to a Stanford study from 2014 that he says demonstrates a clear relationship between organizational culture and a broad set of business outcomes, including company reputation, analysts’ stock recommendations, employee attitudes and financial performance.
In addition to the impact on the bottom line, culture also helps foster adaptability, which includes an organization’s willingness to experiment as well as its nimbleness, flexibility and ability to tolerate some failure.
“When managers think about culture in organizations, they should be sensitive to the fact that what they’re really trying to do is create norms and expectations among employees around this notion of adaptability, and to make sure those norms are widely shared,” O’Reilly says. He highlights four levers that can promulgate the norms and expectations around which organizational culture is built:
Communication. Managers strongly influence culture through the signals they send, the questions they ask, the feedback they give, and the kinds of messages they impart with their words and actions.
Alignment. Managers help employees understand how what they do is important to the larger organization.
Goals. Through vivid illustrations, managers validate which actions an organization considers exemplary, which behaviors are recognized and which outcomes receive approval.
Recognition. Managers maintain culture by honoring employees who share the organization’s values and mission.
“Culture can be a competitive advantage or a competitive disadvantage,” O’Reilly says. “The question for managers is ‘What culture do you need to execute your strategy?’ ”
That means a company’s culture may sometimes need to change with its priorities.
“The key to long-term success is to have a culture that’s aligned with your strategy, but also have embedded in it norms that promote adaptability,” he adds.
We asked four chief culture officers to discuss their career paths and explain how their work contributes to business success.
Kathy Gurchiek is associate editor for HR News.