Performance

1
Performance CulturePresented to the 2005
National Local Government Human Resources
Conference23/25 November 2005
Tracey Luscombe Manager, Human Resources Parramatt
a City Council

• Quentin Jones
• Australian Director
• Human Synergistics International

2

• Key Messages
• Defining and measuring performance culture
• Ideal Culture - What people want!
• Actual Culture - What people get!
• Outcomes - What we get from our current cultures!
• Causal Factors Change Levers of culture
• Case studies of cultural transformation

3
What is Organisational Culture?

• Culture is the shared values, norms and
  expectations ...
• . that guide organisation members
• . in terms of how to approach their work and
  deal with each other and their customers.

4
OCI Circumplex
5
Organisational Effectiveness
Actual Culture (OCI)Cultural Norms
MissionandPhilosophy
?
6
Australian New Zealand ResearchOCI Preferred
Culture
7
Australia/NZ Preferred Culture

• 9,432 people said that this is how they want
  people to be expected to behave

Ideal Culture Humanistic-Encouraging people are
supported and developed to be successful Self-Actu
alising people express their uniqueness,
creativity and embrace change Achievement people
set realistic but challenging goals and believe
their personal effort makes a difference Affiliati
ve people are friendly and cooperative
8
Public Sector (Local Government) 2002Preferred
Culture N 22
Preferred Culture - Samples
Manufacturing 2003Preferred Culture N 75
Entertainment 2003Preferred Culture N 9
Public Sector (Federal) 2004 Preferred Culture
N 40
Energy 2004Preferred Culture N 73
9
Organisational Effectiveness
Actual Culture (OCI)Cultural Norms
MissionandPhilosophy
?
10
Australian New Zealand ResearchOCI Actual
Culture
11
Australia/NZ Actual Culture

• 132,543 people said that this was how they were
  expected to behave

Actual Culture Oppositional oppose new ideas and
change, be on the offensive Avoidance avoid
responsibility and blame others for
mistakes Conventional maintain the status quo
and the way things have always been done around
here Competitive compete with each other in the
a win lose framework, play politics
12
Australian/NZ - Industry splits
13

Australia/NZ
State Public Sector - Actual N6,240
14
Australian/NZ - Sample profiles
15
Sample Organisation
Council All Data June 2000Actual Culture N
562
16
Bank (Rapidly Growing Overseas Owned)All Data
January 2004Actual Culture N 591
Sample Organisation
17
Sample Organisation
UniversityAll Data November 2004Actual
Culture N 144
Avoidance -difficult issues are parked with
sub-committees or working groups. The people who
need to take responsibility can avoid so as long
as the working group deliberates, and refers
discussion papers up and down the committee
structure. Oppositional styles of behaviour
appear when the issues to be avoided cannot be
suppressed any longer. At this stage, individuals
drawing attention to those issues are criticised,
and those advocating change blamed for causing
the bad feeling that is expressed in the
oppositional response. Most of the time this is
done a good deal more subtly and manipulatively
than in its more blatant form described above.
The outcome of this subtle avoidance /
oppositional culture is to sap energy and
demoralise staff. Nobody quite knows where they
are, what they can do and what they cant.
18
Organisational Effectiveness
N
N
MissionandPhilosophy
19
?

• Financials
• Staff Satisfaction
• Customer Experience

?

• Financials
• Staff Satisfaction
• Customer Experience

Overall, the strongest extensions are in the
Aggressive/Defensive cluster
20
Cultures Impact on Financial Performance
21
Research Results

• 1) Retail - Constructive management styles are
  linked to sales growth, reduced stock shrinkage
  and staff turnover (training ROI 101)
• 2) Retail - Constructive cultures lead to reduced
  stock shrinkage (thus higher profits)
• 3) Retail - Constructive cultures can lead to
  higher levels of sales growth (not volume though)
• 4) Financial - Achievement orientation as opposed
  to Conventional management leads to better risk
  management decision making in bank branches
• 5) Manufacturing - Constructive cultures lead to
  higher product quality - lower warranty claim
  costs and lower defect rate
• 6) Multi - Constructive cultures lead to higher
  levels of affective commitment in staff
• 7) Media - Constructive cultures experienced
  higher newspaper readership numbers (R. Cooke
  2000)
• 8) Hospitality - Culture and leadership are
  directly linked to EBIT and staff turnover in
  franchise operations

22
?

• Financials
• Staff Satisfaction
• Customer Experience

?

• Financials
• Staff Satisfaction
• Customer Experience

Overall, the strongest extensions are in the
Aggressive/Defensive cluster
23
OCI Australia NZ All Data September 2004
Cultures Impact on Staffs Satisfaction
To what extent ... are you satisfied being a
member of this organisation?
Culture of those who responded 'not at all' or
'to a slight extent' N 20,782
Culture of those who responded 'to a moderate
extent' N 36,728
Culture of those who responded 'to a great
extent' or 'to a very great extent' N 71,830
24
To what extent are you satisfied being a member
of this organisation? R- Personnel/HR - Total
November 2005
Culture of those who responded 'not at all' or
'to a slight extent' N 36
Culture of those who responded 'to a moderate
extent' N 50
Culture of those who responded 'to a great
extent' or 'to a very great extent' N 62
25
To what extent do you expect to be with this
organisation two years from now? R- Personnel/HR
- Total November 2005
Culture of those who responded 'not at all' or
'to a slight extent' N 56
Culture of those who responded 'to a moderate
extent' N 35
Culture of those who responded 'to a great
extent' or 'to a very great extent' N 56
26
To what extent would you recommend this
organisation to someone like yourself as a good
place to work? R- Personnel/HR - Total November
2005
Culture of those who responded 'not at all' or
'to a slight extent' N 58
Culture of those who responded 'to a moderate
extent' N 40
Culture of those who responded 'to a great
extent' or 'to a very great extent' N 49
27
?

• Financials
• Staff Satisfaction
• Customer Experience

?

• Financials
• Staff Satisfaction
• Customer Experience

Overall, the strongest extensions are in the
Aggressive/Defensive cluster
28
Cultures Impact on Customer Service
Self-Actualising - Customers report that staff
act with integrity, providing innovative and
creative products and services.
Achievement - Customers report that staff take
the initiative to solve problems and make things
happen.
Humanistic-Encouraging - Customers report that
staff go out of their way to help and satisfy
customers.
Affiliative - Customers report that staff make
them feel welcome, communicating in an open and
direct way.
Perfectionistic - Customers report that staff
miss deadlines, by getting wrapped up in detail
which is not important to the customer.
Approval - Customers report that staff go along
with customers even if its poor course of
action for the organisation or the customer.
Competitive - Customers report that staff
manipulate them to focus on a short term sale
over a long term relationship.
Power - Customers report staff trying to subtly
manipulate them, delivering services on their
terms rather than the customers.
Conventional - Customers report that staff tie up
customers with red tape, policies and paperwork.
Oppositional - Customers report that staff argue
with them, criticising the customer and their own
organisation.
Avoidance - Customers report that staff push
decisions to other individuals or departments and
refuse to accept responsibility.
Dependent - Customers report that staff have
doubts about their authority to make on the spot
decisions to improve the service.
29
Australian New Zealand ResearchOCI OEI
Outcomes
30
Outcomes Categories and Scales
Individual Outcomes Positive Indices 1. - Role
clarity 2. - Motivation 3. - Satisfaction 4. -
Intention to stay Negative Indices 5. - Role
conflict 6. - Job insecurity 7. - Stress
Group Outcomes 8. - Intra-unit teamwork and
co-operation 9. - Inter-unit co-ordination 10. -
Departmental-level quality Organisational
Outcomes 11. - Organisational-level quality 12.
- External adaptability
31
OZ/NZ
Gap Barchart of Outcomes
Desirable
50.00
Gaps
40.00
30.00
20.00
10.00
Historical
Average
0.00
-10.00
-20.00
-30.00
-40.00
Undesirable
-50.00
Gaps
Stress
Motivation
Role Clarity
Satisfaction
Role Conflict
Job Insecurity
Quality
Intention to Stay
Cooperation
External Adaptability
Organizational-Level
Inter-Unit Coordination
Intra-Unit Teamwork and
Department-Level Quality
32
Top 3 Cultural Outcomes OZ/NZ

• Organisational Outcomes
• (Poor) Organisational Level Quality The extent
  to which members believe the organisation
  provides high quality services and products to
  external clients.
• Individual Outcomes
• (De-) Motivation The extent to which forces on
  and within members lead them to behave in ways
  consistent with the attainment of organisational
  goals.
• Job insecurity The extent to which members are
  apprehensive regarding their continued employment
  with the organisation.

33
Organisational Effectiveness
MissionandPhilosophy
34
What is Causing Your Culture?
?

• Mission / Philosophy
• Structures
• Systems
• Technology
• Skills and Qualities

35
Australian New Zealand ResearchOEI Causal
Factors Change Levers
36
Causal Factors - Aust/NZ
50.00
Desirable
Gaps
40.00
30.00
20.00
10.00
Historical
Average
0.00
-10.00
-20.00
-30.00
-40.00
Undesirable
-50.00
Gaps
Variety
Feedback
Autonomy
Goal Clarity
Significance
Task Identity
Goal Difficulty
Consideration
Empowerment
Total Influence
Goal Emphasis
Task Facilitation
Use of Rewards
Goal Acceptance
Interdependence
Use of Punishment
Respect for Members
Interaction Facilitation
Articulation of Mission
Fairness of Appraisals
Employee Involvement
Upward Communication
Distribution of Influence
Selection and Placement
Customer Service Focus
Participative Goal Setting
Personal Bases of Power
Training and Development
Downward Communication
Communication for Learning
Organizational Bases of Power
37
Aust/NZ - Top Three Causal Factors

• Appraisal and Reinforcement
• Lever 1. (Non) Use of rewards The likelihood
  that good performance will be noticed and
  reinforced in positive ways (i.e., positive
  reinforcement).
• Supervisory/Managerial Leadership
• Lever 2. (Poor) Goal emphasis (task-oriented)
  The extent to which managers establish and
  communicate norms and expectations for
  excellence.
• Mission and Philosophy
• Lever 3. (Little) Articulation of mission The
  extent to which the organisations mission and
  philosophy are clearly defined, illustrated by
  members, communicated by management, and
  understood by employees.

38
Australian/NZ Research - Key Driver of
CultureLeaders Impact
39
Ideal Impact
The Impact Leaders want to have on
others(Constructive)
Australia NZ OCIN 132,543

• Leaders ideally want to motivate people to
• Set challenging goals
• Be creative
• Be supportive/encouraging to others
• Work co-operatively

N 1337
40
Actual Impact
The Impact Leaders have on others(Passive
Defensive)
Australia NZ OCI PreferredN 9,432

• Leaders actually motivate people to
• Refer to rules procedures to justify their
  actions
• Focus on procedures rather than outcomes
• Strictly adhere to policies standard operating
  procedures

N 9257
41
Actual Impact
The Impact Leaders have on others(Aggressive
Defensive)
Australia NZ OCIN 132,543

• Leaders actually motivate people to
• Do things to be seen noticed
• Constantly compare themselves to their peers
• Manipulate situations to enhance their own
  position

N 9257
42
The Knowing-Doing Gap
Ideal Impact
Actual Impact
Australia NZ OCI PreferredN 9,432
Australia NZ OCIN 132,543

N 1337
N 9257
43

Case Studies - Leaders Impact on Culture
(LSI and OCI)
44
Yarra Valley Water Case Study
45
Yarra Valley Water OCI - Actual Culture 2001 -
2003
Test All Data N 291
Retest All Data N 341
Style
Percentile
Significance
Style
Percentile
Significance
Style
Percentile
Significance
Test
Retest
Shift
Test
Retest
Shift
Test
Retest
Shift
38
53
15
54
31
-23
73
55
-18



Achievement
Approval
Oppositional
25
49
24
69
43
-26
69
37
-32



Self-Actualising
Conventional
Power
Humanistic-Encouraging
Dependent
Competitive
40
56
16
54
23
-31
71
47
-24



21
40
19
78
55
-23
63
43
-20



Affiliative
Avoidance
Perfectionistic
NS Not Significant lt 0.05 lt 0.01 lt
0.001
46
The Outcomes - Yarra Valley Water
The last Employee Opinion Survey showed a 12
increase in overall satisfaction from the
previous year and reached best practice in a
number of categories. So, the staff are happier,
but what about business results? There are also
many tangible business outcomes that can be
linked to the change program, including Efficie
ncy o Low staff turnover (currently 9 from a
high of 26 three years ago) o Recruitment costs
decreased by 60 o Decrease in Gearing ratio
(debt to assets) from 41 to 38 o Decrease in
Debtors from 10 days to 7 days (overdue /avg
daily billings) o Operating cost reduced o Zero
industrial action Customer Satisfaction -
Improvements in the Milward Brown survey
o Staff Efficiency and Promptness increased from
60 to 92 o Politeness and Courtesy increased
from 80 to 88 o Staff Competence increased from
90 to 98 External Recognition - many awards,
including o The Prime Ministers Award for
Excellence in Community Business Partnerships
(2003) o Customer Service Institute of Australia
Victorian Call Centre of the Year and
Teleprofessional of the year (2003) o Customer
Service Institute of Australia Service Excellence
Awards 2004 winner of Victorian and National
Government Award categories o Government
Technology Productivity Gold Award (2003) o ACCI
Work/Life/Balance awards (2002, 2003)
47
The measurement and management of organisational
culture is a critical success factor in
maximising staff attraction, satisfaction and
retention. Management plays a key role in
setting cultural expectations via their vision,
the structures, systems and leadership practices
they implement. To build more Constructive and
attractive organisations, Australian leaders
have a unique challenge in better defining and
communicating their vision, role modelling
excellence and, aligning rewards with desirable
behaviour and performance.
48
A Leaders Impact
Fairfield City Council LEADERS LSI 2001-2003
Retest Tracey Luscombe 2003 N 5
Test Tracey Luscombe 2001 N 5
Style
Percentile
Significance
Style
Percentile
Significance
Style
Percentile
Significance
Test
Retest
Shift
Test
Retest
Shift
Test
Retest
Shift
70
96
26
30
9
-21
67
35
-32

NS
NS
Achievement
Approval
Oppositional
76
91
15
9
9
0
82
40
-42
NS
NS
NS
Self-Actualising
Conventional
Power
Humanistic-Encouraging
Dependent
Competitive
56
92
36
7
7
0
83
52
-31
NS
NS
NS
50
78
28
30
16
-14
48
43
-5
NS
NS
NS
Affiliative
Avoidance
Perfectionistic
NS Not Significant lt 0.05 lt 0.01 lt
0.001
49
A Leaders Impact
Fairfield City Council LEADERS LI 2002 - 2003
Test Tracey Luscombe 2002 N 8
Retest LUSCOMBE, TRACEY 2003 N 8
Style
Percentile
Significance
Style
Percentile
Significance
Style
Percentile
Significance
Test
Retest
Shift
Test
Retest
Shift
Test
Retest
Shift
88
95
7
14
1
-13
27
18
-9
NS
NS
NS
Achievement
Approval
Oppositional
67
93
26
1
3
2
25
23
-2
NS
NS
NS
Self-Actualising
Conventional
Power
Humanistic-Encouraging
Dependent
Competitive
78
92
14
5
1
-4
37
42
5
NS
NS
NS
35
77
42
4
4
0
21
4
-17
NS
NS
NS
Affiliative
Avoidance
Perfectionistic
NS Not Significant lt 0.05 lt 0.01 lt
0.001
50
Parramatta City Council OCI - Actual Culture
2004-2005
2005 Retest All Data N 497
2004 Test All Data N 35
Style
Percentile
Significance
Style
Percentile
Significance
Style
Percentile
Significance
Test
Retest
Shift
Test
Retest
Shift
Test
Retest
Shift
28
45
17
70
38
-32
85
71
-14
NS

NS
Achievement
Approval
Oppositional
22
49
27
63
44
-19
78
34
-44

NS

Self-Actualising
Conventional
Power
Humanistic-Encouraging
Dependent
Competitive
25
59
34
46
28
-18
74
39
-35

NS

12
42
30
90
54
-36
63
43
-20


NS
Affiliative
Avoidance
Perfectionistic
NS Not Significant lt 0.05 lt 0.01 lt
0.001
51
A Leaders Impact
Parramatta City Council HR TEAM OCI 2005
LEADERS LSI 2003