A business culture that an organization chooses to adopt can either catalyze or undermine the success of the organization. Yet many business leaders do not know the importance of culture and how to measure it. The values and beliefs that people say are important to them, for example, are often not reflected in how they actually behave. But what tools can business leaders use to measure culture? What are the shortcomings of these tools and what is the best one?
It is difficult to define culture. In 1952, the American anthropologists, Kroeber and Kluckhohn, went on a journey to critically review the concepts and definitions of culture. They came up with a list of 164 different definitions. They defined culture as shared patterns of behaviors and interactions, cognitive constructs, and understanding that are learned by socialization. In simple terms, culture is a common term often used to refer to symbolic markers used by ethnic groups to distinguish themselves from each other.
Culture analytics is the science of using workplace culture data to generate meaningful actionable insights that improve organizational results. This means the use of technologies to gather, measure, and model (using smart algorithms) cultural information to give business leaders and HR managers really actionable.
Why should business leaders consider culture analytics? Well, Peter Drucker the management guru once said, “Culture eats strategy for breakfast.” Culture is a key building block. Whether business leaders consider talent acquisition, people engagement, business performance, or any transformation, culture is the centerpiece of it all.
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The future success of any organization lies in using culture data to identify the behavioural features and identifying individuals who are highly aligned to the culture. Culture data also enables one to hire, develop, and promote using insight about an individual’s degree of alignment with the organization’s current or target culture. Organisations need to re-visit their current culture and drive it in a completely new direction.
Most organisations want to adopt new technologies, new workplaces like open workplaces but culture is the major hindrance. For example, according to a global survey of more than 4,500 executives, managers and analysts from more than 120 countries and 30 industries that was measuring the adoption of analytics in different organisations, 44 percent of organizations cited cultural barriers to enterprise-wide analytics adoption. These primary barriers include the requirement for new leadership competencies and organizational resistance to new ideas.
The traditional tools available for measuring cultures such as employee surveys and questionnaires have significant shortcomings. Employee self-reports are often unreliable. Culture analytics is a new method of assessing and measuring organizational culture. Organizations are using machine learning processes to mine the global “digital traces” of culture in electronic communications, such as emails, Slack messages, and Glassdoor reviews. By studying the language employees use in these communications, companies can measure how culture actually influences their thoughts and behaviour at work.
The burst of digitally traceable data such as emails and Slack communications, together with the availability of computational methods that are faster, cheaper, and easier to use, has ushered in a new scientific approach to measuring culture.
There are a number of benefits to be gained by organisations after leveraging culture analytics. The first benefit to be enjoyed include hiring best fits. By regularly assessing your culture, business leaders can measure new recruits against the ideal baseline and ensure the perfect corporate-cultural fit. In the long term, this translates to reduced turnover and a more enthused workforce.
The second benefit is the ability to accurately measure skills. Culture analytics can reveal insights into employee soft skills which are one area that traditional assessments were neglecting. An employee’s interaction with and contribution to organizational culture is a good indicator of their soft skills capabilities. Once these gaps are revealed, they can be resolved through training and employee engagement initiatives.
The last one is smarter talent management. Internal talent decisions, from internal hires to retrenchments, hinge on an understanding of the current cultural environment in the organization. Machine learning gives HR managers detailed data on an employee’s cultural alignment, aiding decision-making.
An American company called Humantelligence that focuses on AI culture analytics and recruitment solutions use AI to analyze company culture and synchronize individual hires to specific metrics. The company claims to reduce attrition by 30 percent, offering a quick yet advanced 12-minute assessment tool.
In a January 2020 article, Harvard Business Review mentioned that they did studies to assess company culture. In one study, they partnered with a midsize technology company to assess the degree of cultural fit between employees and their colleagues on the basis of similarity of linguistic style expressed in internal email messages.
In a separate study, they analysed the content of Slack messages exchanged among members of nearly 120 software development teams. They examined the diversity of thoughts, ideas, and meaning expressed by team members and then measured whether it was beneficial or detrimental to team performance.
In the last study, they also partnered with employer-review website Glassdoor to analyze how employees talk about their organizations’ culture in anonymous reviews to examine the effects of cultural diversity on organizational efficiency and innovation.
All of these studies reviewed how culture influences employee thoughts and behaviour at work. For instance, Stanford Ph.D. candidate Anjali Bhatt is working with two of us to demonstrate how language-based culture measures can be used to anticipate the pain points of post-merger integration.
There are many off-the-shelf tools that have great potential for business leaders to use them to help solve practical challenges inside organizations. The accessibility of these tools also raises important ethical concerns. In many organisations there is strict employee confidentiality.
Harvard Business Review pointed out that, It will be bad practice for organisations to use these tools to select, reward, or punish individual employees and teams, for at least four reasons: Accurately predicting individual and team performance is considerably more challenging than estimating average effects for broad types of individuals and teams; culture is only one of many factors influencing individual and team performance in organizations; algorithmic predictions often create a false sense of certainty in managers; and finally, giving any algorithm undue weight can have unintended consequences—for instance, exacerbating human biases that negatively affect women and members of underrepresented social groups.
Going forward, culture analytics will prove extremely useful as organizations explore new ways to engage with employees, align their requirements to large targets, and leverage culture as a key differentiator for success. We expect several disruptive players to introduce solutions that make adoption possible, and indeed, make culture analytics a staple for progressive organizations.
Benjamin Sombi is a Data Scientist, Entrepreneur, & Business Analytics Manager at Industrial Psychology Consultants (Pvt) Ltd a management and human resources consulting firm.