CEOs should treat culture like a business imperative

Dive Brief:

Just 31% of HR leaders in a Gartner survey said their organization has the kind of culture it needs. With companies investing on average $2,000 annually per employee on culture initiatives, CEOs should partner with CHROs to drive culture change that's embedded in business objectives, Gartner said.
According to Gartner, discussions between CEOs and CHROs must address cultural tension, which occurs when employees don't know how to handle issues that seem conflicting in their daily work. For culture to be taken as a serious business imperative, leaders must also get an honest view of their company's culture from employees' experiences and be transparent about what they will seek to monitor, in turn. Gartner suggests establishing model behaviors that reflect how culture is communicated and carried out.
To get leaders to focus on the operations segment of cultural role modeling, CEOs should "treat leaders' responsibility to drive culture the same way they treat other business activities," Gartner said in the study.

Dive Insight:

Gartner's managing VP, Bryan Kurey, commented on the importance of culture driving business strategy and its limitations in a media statement: "Investors, regulators, and prospective and current employees all expect leaders to be responsible and accountable for their organization's culture. And CEOs need the culture to actually drive business strategy and results. But culture initiatives don't automatically return the investment."

Experts agree that culture is more than an atmosphere that makes stakeholders feel fuzzy feelings. Organizations must decide on the kind of culture they want to have and maintain, while making sure it meets business outcomes. Barbara Porter, now managing director at EY, previously explained to HR Dive why culture must be aligned with business objectives: "For so long, people thought [culture] was about the soft, emotional stuff; making people happy. If you're just focused on making people happy, you will lose money and go out of business."

Culture was at the heart of the 2019 Society for Human Resource Management Annual Conference mission statement — and while the conference used inspirational language to discuss the importance of culture, SHRM President and CEO Johnny C. Taylor Jr. emphasized that HR must talk about culture with business strategy in mind. That way, CEOs recognize the strategic advantage of giving resources to HR initiatives.