Are you serious about creating a business environment and corporate culture that are positioned for success? Let’s talk.

by Katerin Le Folcalvez, Christine Flouton, Shideh Sedgh Bina

What is a company? By definition, it’s a bunch of people working in a bunch of buildings who make a product or offer a service. Right? Wrong…

British Airways, for example, is a company that comprises numerous facilities, thousands of airplanes, and tens of thousands of people, all of whom offer you the opportunity, for a price, to go from Point A to Point B. But Southwest Airlines does the same thing. Like British Airways, Southwest has planes and hangars and office buildings and gate agents and baggage handlers and flight attendants and pilots working to get you somewhere in exchange for your money. Both British Airways and Southwest are in the same business of air transportation. But they’re not the same.

No two companies, organizations, or enterprises are the same, no matter how similar their operations. And the differences are both bigger and more subtle than having different work uniforms, or the color of the company logo, or even the key operational strategies. The big — and small — differences between organizations come down to its network of conversations.

A premise of our work at Insigniam is that any company is constituted by a network of conversations. All day long people are speaking and listening to others. They’re answering emails. They’re talking in the hallways. They’re writing and reading reports. They’re having executive meetings. They’re meeting with clients. They’re sharing and receiving information. All of that, whether it is face-to-face or written, is part of the network of conversations within that organization.

Business gets done through these conversations — when they’re effectively led and managed, the business performance is remarkable. Business grinds to a halt through these conversations when they’re ineffective. Either way, the very manner in which organizations exist and move emerges as this network of conversations develops. Culture also emerges from these conversations.

And there are cultural consequences for failing to manage the network. Tony Hsieh, the CEO of Zappos, says that when LinkExchange, one of his earliest start-up companies, began to grow rapidly, he lost track of the network of conversations the larger staff was having, and in so doing, lost control of the culture. “One of the things that we didn’t know to pay attention to at the time was the company culture,” Hsieh told CNBC. “So as the company got bigger and bigger the culture kind of deteriorated, and that’s actually why we ended up selling the company.”

As Hsieh’s example shows, it is essential for leaders to pay attention to the network. We believe that leaders are accountable for managing the network of conversations in their organizations. That doesn’t mean trying to exercise some kind of Orwellian control over what’s being talked about in your company. It also doesn’t mean simply taking an active interest in “corporate communications” — the formal messaging composed in the C-suite and disseminated through the ranks. And it doesn’t mean simply being a great communicator as a leader. The network of conversations is about more than what leaders say. It’s about, at all levels, what is being said in an organization, what is not being said that probably should be said, and most importantly, what is being heard.

In a large organization, it’s a challenge to manage that entire network of conversations. But leaders should spend time developing a sense for it and helping to foster an effective network. A well-managed network of conversations will clearly communicate messages about the organization’s shared values, its expectations, its principles, its mission, its strategies, and a clear picture of the future for which everyone ought to be striving.

Talk is not cheap. And whether that talk is written or verbal, internal or external—brand management is an example of the function of the external network of communications — leaders need to make a serious time investment in managing it. Like an actor who has greater power in their craft when they can play a range of diverse roles, we find that the most powerful organizations feature a diverse range of conversations that leaders are effectively managing. We have identified the five types of conversations we believe must be present in any organization.

CONVERSATIONS THAT BUILD RELATIONSHIPS

Conversations that build relationships give people an opportunity to get to the heart of what matters to them and to understand commitments and concerns of the people they’re working with.

One way executives often do this is by having “coffee talks” with small or large groups of randomly selected employees. The talks are a chance for workers to tell leaders whatever they want to discuss, and for leaders to share some general insight into where the people in the company stand.

In the 2012 book, Talk, Inc., the authors say James Rogers, when he was CEO of Cinergy before it became a part of Charlotte-based Duke Energy, began a series of discussions modeled on the “coffee talk” concept. He held his “listening sessions” with as many as 100 participants from different parts of the company. At one such session, a worker told him about an issue with uneven compensation in one division, something Rogers could fix but that he thought might otherwise have taken forever “to bubble up in the organization.”

THE TAKEAWAY// All results are built on a foundation of relationships. The bigger the foundation, the bigger the opportunity for results.

CONVERSATIONS THAT GENERATE NEW POSSIBILITIES OR NEW INSIGHT

People talk to each other sometimes not because they have any specific agenda, but just because they enjoy conversation. Organizations should seek to foster those same kinds of discussions.

Recently, the C-suite leaders at one of our clients met to talk about a change in direction. Although their bottom line numbers were good, they believed their industry was moving in a new direction, a new normal so to speak, and that in time — perhaps five years or so — they would be left behind if they stuck to business-as-usual. As one of them put it to us, “We saw a freight train coming our way.” So for months the executives discussed and speculated on different ideas about what might be the boldest, most inspiring future they could pursue. They brought in non-executives to measure the appetite for change within the organization. They engaged representatives from different categories of their workforce to talk about what would be possible. They paid for new market research reports and poured over the resulting data. In other words,they talked among themselves, to others, in person, by email, in reports, by phone, et cetera. They explored possibilities without driving to an immediate commitment. As they engaged in these various and, at times, divergent ideas, a common view of a very bold, game-changing future direction naturally emerged. This common platform became the basis of a powerful new strategy that took them off the tracks of being run over by the freight train to driving the train in a new direction — and thrust them ahead of competitors in a relatively short time frame. In the months after they launched the new strategy, they saw an immediate and significant uptick in their financial measures.

THE TAKEAWAY// All conversations about the business don’t need to end in a commitment to action. Some conversations that deal with possibilities tackle huge challenges. Others deal with smaller changes — perhaps signing a new client, or making a minor adjustment to a product or service. Whichever it is, the key is to be sure and have conversations that create and explore new possibilities to help people see the world and their business differently. This will smooth the path to new and more effective actions.

CONVERSATIONS THAT DEAL WITH OPPORTUNITIES

These kinds of conversations take something that is aspirational and try to make it feasible. They take speculation and create a pathway to make it actionable.

At one of the companies we worked with, employees told us that executives were so focused on present results and on an aggressive stock buyback program that they were not investing in the future. Since the employees wanted to commit to a long-term relationship with the company, they worried whether leadership was not prepared to commit to them in the same way. When we surveyed employees and found out that this was the conversation that was going on, leadership was shocked. The truth was that the stock buyback program was intended to solidify the company’s future and that other types of investments in the future hadn’t changed at all — in fact,they had increased!

In need of a solution, the CEO and his direct reports then took the responsibility to manage the network of conversations going on about the future. They more clearly communicated the investments the company was making and brought a larger number of workers in to share in the development of those investments so that conversation could more easily spread throughout the company.

THE TAKEAWAY// We see the world in how it is framed for us or how we frame it for ourselves. We make assumptions. And bad assumptions can clog up a company’s network of conversations. To gain commitment to new aspirations, the people you lead must also see clear pathways to accomplishing those aspirations.

CONVERSATIONS THAT GENERATE ACTION

This kind of conversation asks something like, “Who is doing what and by when will it be done?” It’s self-explanatory in a sense. You’re talking with a very specific purpose — to get something done or to ensure that something has gotten done.

But this conversation also provides a good example of how the network of conversations builds on itself. Every leader has to ask these kinds of questions of people. But suppose you spin that question to this: “Who was tasked to do this and when was it scheduled to be done?” Then suppose you haven’t had effective conversations about relationships (you don’t know what values are shared among your group), possibilities (you never explore different ways of thinking or talk just to talk), or opportunities (your organization is all about today’s tasks and never about making other ideas into reality). What happens when you get to an action-based conversation and the action didn’t happen? What happens when someone failed to perform? That resulting conversation — if you don’t know each other, trust each other, and share some bigger vision of the future — devolves into a blame game. “It’s his fault.” “She messed up.”

THE TAKEAWAY// To avoid blame that causes bottlenecks, conversations that generate action must be held in the context of conversations that have built relationships and explored and attempted to create new possibilities and opportunities. Don’t assume accurate and fair things are being said to people all the time. Actively manage the network of conversations to learn what is being said and what is being heard and to keep the dialogue flowing as accurately and cooperatively as possible.

CONVERSATIONS THAT UNCOVER BREAKDOWNS AND RESOLVE THEM

Every organization has problems, challenges, and failures. In too many companies, when things go poorly, people hide. They deflect blame. They give up altogether.

But we have a saying: breakthroughs are really just a series of well-met breakdowns. Look at what happened at GM. The 300-page report that details the company’s ignition switch failures shows that there were no conversations taking place about breakdowns. Culturally, this was simply not part of GM’s network of conversations. The report repeatedly states that cultural issues convinced employees to remain silent about safety issues and then prevented managers from taking responsibility for those issues once they occurred. In GM’s case, failing to foster that kind of conversation was a life-and-death issue. In most companies it won’t be. But it’s still serious. And leaders are the ones most responsible for embracing and even beginning the conversations that uncover why something went wrong and how it can be corrected.

THE TAKEAWAY// As with conversations that generate action, conversations that uncover and resolve breakdowns can only be effective when a larger, open, and honest corporate dialogue has been established. Make it popular to illuminate breakdowns and frame them as milestones along the way to aspirations, not problems that are obstacles. Otherwise, it’ll be all about blame and not about resolution.

BRINGING IT ALL TOGETHER

Business Results Depend on Managing the Network of Conversations | Insigniam Quarterly

One of our clients, a highly unionized firm that paid its workers the best wages in their region, called us in when trouble was brewing between management and workers. In spite of the good level of financial compensation throughout the organization, workers and leaders were not getting along. At its core, the issue was about loyalty. The workers believed leaders were not loyal to them. When a new pay-for-performance system was rolled out, a worker had asked the former CEO in a meeting with union workers, “What about loyalty?” The story quickly circulated that the former CEO had responded to that loyalty criticism by saying, “If you want loyalty, buy a dog.” The workers then often complained about being considered in the same class as dogs.

The company addressed these tensions in many ways, one of which was to start simple dialogue that asked leaders and workers what they valued. In doing so, they were having the very first kind of conversation that we’ve discussed, a conversation about building relationships — a conversation that’s fundamental to the other things going on in the broader network of conversations. These discussions brought to light that the workers were putting up with some undesirable work practices for the great pay because of a strong commitment to providing well for their families. The undesirable work practices were ways of handling overtime, holiday scheduling, and environmental stressors that ended up actually diminishing their quality of family life. During these discussions, the managers realized that they shared a common commitment to family with the workers.

That awareness led to discussions around “creating a workplace where families thrived.” To realize that possibility, employees and management together established a set of opportunities that included an annual family picnic. They also set up an annual awards ceremony to acknowledge and recognize outstanding job performance — an event they hoped would communicate the company’s loyalty to its workers. A few simple adjustments to their practices for scheduling eliminated the factors in the environment that were triggering stress.

In the end, both of these events cleared a path for more honest conversations between the formerly fractured parties. And here’s our favorite single example of how that happened. At the first of the award ceremonies, one of the workers went up to the CEO and said, “I was at that meeting where the story came from about (the former CEO) telling us to buy a dog. I don’t know where that rumor came from. He never said that about us — he used that phrase about another topic.”

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Katerin Le Folcalvez, Christine Flouton, Shideh Sedgh Bina

comments
  • Kathleen Morris

    Hi Christine,
    So appreciated this article. Am forwarding it to a few people.
    Warm regards,
    Kathleen

    • Christine Flouton

      So great to hear from you, Kathleen, and thank you for taking the time to write! Glad the article made a difference for you. All my best, Christine