Why Digital Transformation is useless without a Cultural Shift

Talk to any company and they will tell you they are in the midst of a digital transformation. Talk to their leaders and ask them how they have ignited a supporting cultural change, and most of them will look at you as if you were an alien.
“Culture eats strategy for breakfast”, Peter Drucker taught us. It emphasizes the need for an uncompromising culture change when a new strategy is aspired. But leaders are struggling. Most of their time and energy is focused on developing new business models and pursuing new digital objectives rather than worrying about culture.


It is a tough one, changing culture. It is tough to define culture as well. Brian Chesky, CEO of Airbnb, phrased it like this: “Culture is a thousand things, a thousand times. It’s living the core values when you hire; when you write an email; when you are working on a project; when you are walking in the hall.”
‘Core Values’ are probably THE most important aspect of your company’s culture. It is the glue to keep your organization together. Every single employee should live and breathe these values. A great sense of openness is key and to be quite honest, that is precisely what is lacking in a large number of organizations. Existing hierarchical relationships between employees are impeding open feedback, thus making it hard for the gap between aspired and actually practiced values to be bridged.


In the new world – which by the way is already there – customer-centric organizations are the only ones to survive. “A company’s primary responsibility is to serve its customers”, again by Peter Drucker. If you want to give your customers the very best experience, you need to simultaneously create the best experience for your employees. Their engagement is crucial to your company’s success. And one of the first crucial aspects of getting everybody engaged is to align them on the same set of values for the customer’s experience and to create the employee experience accordingly. If you want your customers to feel they can “trust” your company, your employees need to feel trusted as well.


What do you want your company to act like? How do you want to be perceived on the outside AND the inside? Companies are no longer black boxes that can make any customer BELIEVE their brand values. Companies have become transparent – sometimes not because they really want to, but because hyper connectivity with the outside world has lead them to it. Core values, aligned to the company’s mission are essential to survive. Every company has a mission, still it remains to be seen if every company has its core values defined as well. And for those that have, the challenge will be to check on their relevancy today and to probably get them refreshed. It is not coincidental that Microsoft’s CEO Satya Nadella named his book “Hit Refresh”. His company is going through a huge transformation, with individual empowerment at the center of its cultural change. He speaks of a Cultural Renaissance, where people should develop from Know-It-Alls to Learn-It-Alls. “Accountability trumped everything” he writes, basically admitting that the way his employees were – or still are? – rewarded made it near to impossible to get everyone actually live the values.
Redefining your culture and your values is a key success factor to drive (digital) transformation within your company. It is a long and painstaking trajectory that requires a lot of patience, with great effort to be put in continuous and clear communication. CEOs in large corporate organizations claim it may take up to five years.


Leaders need to demonstrate the behavior they want from their employees, and actively reinforce this desired behavior. However, people will always practice VALUED behavior, so anything they do that elicits praise or promotion they will keep on doing, even if this is not in line with the aspired values painted on every single office wall. Adapting the performance management system is crucial if you want to actually reward value-congruent behavior. If your company’s slogan is to put customers first, any single one employee that does not live up to that value should probably be offered a severance package. Even if it is one of your “top performers” revenue wise.