Culture is reflexive: In changing culture, there are three critical areas to address

1. Culture is reflexive: Beliefs shape behavior, but behavior also shapes beliefs. Values affect beliefs and behavior, but beliefs and behavior also affect values. Often espoused beliefs and values are not consistent with the beliefs and values that can be inferred from observed behavior. This lack of alignment can cause great dysfunction.
2. Most organizations are a mixture of many cultures: one in R&D, another in marketing / Sales, etc.
3. External forces, historical forces and internal forces all shape behavior. Managers can most affect internal forces giving them a lever to change culture.
4. In changing culture, there are three critical areas to address.
1. Content of the change (vision of the new culture).
1. Do a culture audit: What is the culture like, what needs to be changed?
2. Leadership is essential for successful culture change.
3. Key champions at all levels are required.
2. Leverage points for change (what and how to change).
1. Full-blown culture change requires change in all the key elements of organizational context: structure, business processes, measurement, appraisal and rewards. If, in fact, you do all these things, Nadler argues that culture change will be the ultimate outcome.
2. Values must be articulated in terms of expected behavior. Establishing one value as more important than others is important to give people a set of priorities.
1. Good technique used at AT&T, where Senior Executives interviewed people lower in the organization about the new values and how they saw them being implemented. This is a good check on implementation, and helps senior executives understand the issues involved in the effective transformation of a culture.
2. A key test of culture change is who is getting promoted, the good guys or the bad guys
3. What happens to someone delivering good results but not living the new values? This is a critical dilemma for leadership. Support and coaching for change must be offered; if a person refuses or does not change, then they must be removed. GE under Jack Welch was very strongly committed to having executives both get results and live the values. If they did not live the values, and did not improve, they were out.
3. Tactical choices (when and where to change).
1. Culture and values are the very foundation upon which the overall change agenda rests.
2. Interventions into culture should be sequenced separately from the hardware changes. One effective sequence is to have culture initiatives occur sometime after the announcements of structural and work-process changes.
3. Use bottom-up interventions also, e.g., education and training, meetings, forums, etc.
4. Migrate change laterally from one organization to another. Use beta sites and skunk works to try out changes and work out the kinks. Transfer that learning to the next site. Customer visits can be a very powerful tool in this change. Customer needs get the attention of almost any level in the organization.

Insight from: Delta Consulting's (David Nadler) perspective