Culture Self-Assessment Practice
How to Do a Culture Self-Assessment
Ann Skeet
Every organization has a culture but most accept the one they have as a given.
The Markkula Center’s Ethical Culture Self-Assessment Practice offers corporate boards and senior management teams a unique opportunity to peer into the health of their company’s culture. It provides companies with information to assess the alignment between the current ethical culture and an organization’s espoused values. As a tool of leadership and governance, it provides a meaningful way for boards and executive management teams to understand culture, and set and clarify expectations.
Program Details
The purpose of the Ethical Culture Self-Assessment is to provide boards of companies with objective data concerning the degree to which their organizations have ethical cultures, and to identify needed steps to correct any issues identified. The data source is an organizational diagnostic tool designed to identify the specific cultural strengths and weaknesses that may lead to, or deter, ethical misbehavior.
Methodology
Working with senior management, a third-party vendor identifies strengths and weaknesses pertaining to culture, and identifies the necessary steps to address them.
Data are collected through one-hour interviews with senior executives and half-day focus sessions leveraging collaborative software, in both quantitative and qualitative form. Third-party assessors then analyze the data, interpret the findings, and offer insights to the board of directors, senior management team, or both.
Advantages of Method
• Gives a board motivation and confidence in its ability to monitor and foster ethical performance
• Engages senior executives, encouraging executive level ownership of ethics
• Is customized for each company
• Starts with objective collection of data in a focus-group setting
• Allows for in-depth probing to identify sources of problems, documents, and provides data and next steps
• Requires relatively little board and employee time
• Audits culture more holistically than survey-based assessments
Deliverables and Results
A third-party collector of data is critical. With a modest resource investment, companies can insure confidentiality and add credibility to the process. Without prior knowledge of taboos, facilitators can objectively surface hot button issues and probe deeply on responses when there is significant divergence of opinion. Using a third party encourages open participation by employees. Information can be stored for future analysis. Organizations can identify and use this methodology with any third-party facilitator or vendor of their choosing.
The board should require a comprehensive report with data visualization and key findings, the anonymous data collected in the focus sessions, and guidance offered in a report and one-to-two hour session from its selected vendor. This exchange between the board provides time to explore implications of the findings for the board and management team.
Recommended Process Steps
1. Agreement on audience, purpose, and scope of project
The Ethical Culture Self-Assessment was originally designed as a comprehensive culture assessment for the board of directors with the purpose of offering insights to the board on how they can meet their legal duty to understand and maintain the ethical culture of their respective companies.
This initial purpose definition was derived from the 2013 Federal U.S. Sentencing Guidelines which read:
“To have an effective compliance and ethical program, an organization shall….promote an organizational culture that encourage ethical conduct and commitment to compliance with the law.” And
Boards are responsible for “Due diligence and the promotion of an organizational culture that encourages ethical conduct and a commitment to compliance with the law….”
In reality, organizations may shape an assessment of culture to fit a range of purposes based on the audience commissioning the assessment and the scope of information they seek. In addition to the broad assessment of culture provided by the original design, assessments can be formulated to serve the needs of a senior management team, who might choose to use strategic goals, organizational mission and value sets to define desired outcomes. Boards and management teams can partner to design assessments that meet both the legal and ethical obligations of boards and the strategic, operational, and managerial responsibilities boards delegate to management teams.
Some organizations may choose to assess certain aspects of culture, risk and ethical permeability at a time, rather than a broader rendering of the current culture. We provide examples under the Sample Question Set tab of topics that can be probed in-depth, such as environmental risk and data security.
2. Agree on data sources and software use and choice
The Markkula Center design considers the use of focus groups and the collection of confidential, anonymous data from participating employees essential.
Organizations may choose to augment this methodology with surveys and expand beyond confidential data collection by inviting willing employees to be contacted further about their responses.
A software choice to collect data should be identified, sampled, and contracted. This is an additional, but relatively reasonable, cost element of the overall assessment. For our pilot project, the Markkula Center used the OptionPower Virtual Base Station Moderator Tool from Option Technologies.
3. Identify senior managers willing to be interviewed to contribute to the assessment design
Depending on the size and operating style of the organization and its board, the number of drivers for this process and contributors to its design may vary. A smaller, start-up operation may choose to poll founders, for example, to identify the assessment’s purpose, scope, and design. A larger organization may want to engage senior executives in multiple locations and disciplines to shape the assessment.
These interviews are an essential element of the process, as they engage key stakeholders in co-creating the activity.
4. Develop assessment design
Publish a purpose to meet the needs of an audience and define the preliminary scope of assessment. The scope may change after managers are interviewed.
5. Interview managers
Use a set of open-ended questions to poll senior managers about the issues in the organization broadly, if the company is anticipating scoping the assessment to capture the organization’s ethical culture, or more narrowly if there are topical areas the organization is choosing to focus on, such as data security, diversity and inclusion, or relationships with customers.
6. Develop question set, finalize design
Following this initial round of interviews, the assessment’s commissioners must agree upon a question set, select a third-party project manager/process facilitator, and software to use for the assessment. A vendor can be identified earlier in the process if the organization would like assistance in designing the questions to be used with focus groups.
7. Conduct focus groups
The number, size, and location will vary by company size and resource commitment as third-party vendors typically set fees based on scope of the project and time required to complete it.
8. Collect anonymous data on independent/secure device
Questions are posed to the focus groups and individual participants are first invited to respond anonymously. This is a critical element of the Markkula Center’s design. There is a scaled, objective response for each question and some or all can offer the opportunity for comment as well.
After each person has entered their response, the responses are shared in real-time with the participants.
At times, responses cluster consistently around one end of the response spectrum, signaling relative consensus within the group, even if comments vary. If the topic has been identified by the assessment’s commissioners as especially critical to understand, facilitators may choose to probe even when there is consensus.
More typically, probing is reserved for response sets with broader variance, either scattered across the objective scale or with polarized, different responses. It is in this step that the experience and deftness of the focus group facilitator (the third party vendor) can most obviously influence the utility and outcome of the assessment. Organizations should be prudent and thorough in their third-party assessor selection.
9. Analyze data
The data should be analyzed both quantitatively and qualitatively. Examples of both types of data presentation are provided in the materials within this culture assessment practice.
10. Present to the identified audience
Data is synthesized and presented to the key audiences. At this point, ownership of the process shifts to the company’s leadership to determine and design next steps. Again, this is an essential element of the Markkula Center design. Engaging organizational leaders to drive culture change is key. Outside third-parties are not as successful at implementing culture change based on research we share elsewhere on our site. This research also reinforces why this process should be ongoing and iterative if organizations aim to drive ethics throughout the workplace.
Using the Markkula Center as your third-party vendor is an option but not a requirement to achieve the benefits from this approach. When the Center conducts the assessment in that role as third party, we charge an assessment fee. More information can be found by contacting the Center at 408-554-5319, or emailing us at ethics@scu.edu.