High performance cultures share six characteristics. They are highly adaptable, vision-guided, and values-driven; they care about all their stakeholders; they are resilient, and they have low levels of cultural entropy.
Adaptability: In a rapidly changing world you can only survive and prosper if you can rapidly adjust to market conditions. Adaptive organisations grow faster than hierarchical, bureaucratic organisations and have superior revenue growth. Adaptability is at its highest when accountability is distributed throughout the organisation and the leaders are highly accessible.
Vision-guided: An inspiring vision builds internal cohesion and keeps everyone in the organisation heading in the same direction. The vision guides long-term decision-making.
Values-driven: Together with your vision, your values are the pillars of the culture of your organisation. Your values let everyone know what is important and provide guidance in making daily decisions.
Stakeholders: Organisations that care about all their stakeholders create success by building strong, enduring relationships. When you show that you care about your employees, customers, investors, partners, the local community, and society at large, they care about you.
Resilience: Breakdowns, stoppages, and strikes, significantly influence organisational performance and can significantly impact financial results. It is therefore essential to invest in resilience—both cultural, and operational.
Low Cultural entropy: Cultural entropy is a measure of the degree of dysfunction in an organisation. It is the amount of energy consumed in unproductive work such as bureaucracy, internal competition, and blame. High performing organisations measure their cultures on a regular basis to reduce their level of cultural entropy. Low cultural entropy is strongly correlated with high staff engagement and revenue growth. High staff engagement increases the amount of energy available to an organisation through the additional discretionary energy that highly engaged employees bring to their work.
For more information, see:
John P. Kotter and James L. Heskett, Corporate Culture and Performance. The Free Press, New York, 1992
Richard Barrett, Building a Values-Driven Organisation: A Whole System Approach to Cultural Transformation, Butterworth-Heinemann, Boston, 2006
Rajendra S. Sisodia, David B. Wolfe, Jagdish N. Seth, Firms of Endearment: The Pursuit of Purpose and Profit, Wharton School of Publishing, Upper Saddle River, New Jersey, 2007
Jim Collins and Jerry I. Porras, Built to Last: Successful Habits of Visionary Companies, HarperCollins, New York, 1994
Jim Collins, Good to Great, HarperCollins, New York, 2001