1. 1 The Benefits of a Constructive Culture Compiled by: Janet L. Szumal, Ph.D. and Cheryl A. Boglarsky, Ph.D. Copyright © 2011 by Human Synergistics International. Research and development by R. A. Cooke, Ph.D. and J. Clayton Lafferty, Ph.D.

2. 2 Organizational Culture is an Organizational Imperative Culture needs to be the top priority of top executives because— regardless of whether they pay attention to it—culture exists and affects everything that matters most to the organization and its stakeholders. Janet L. Szumal, Ph.D. Human Synergistics/Center for Applied Research, Inc. Copyright © 2011 by Human Synergistics International. Research and development by R. A. Cooke, Ph.D. and J. Clayton Lafferty, Ph.D.

3. The Benefits of a Constructive Culture I.Better financial performance II.Positive customer experience III.Greater employee engagement IV.Higher levels of productivity 3 Copyright © 2011 by Human Synergistics International. Research and development by R. A. Cooke, Ph.D. and J. Clayton Lafferty, Ph.D.

4. The Benefits of a Constructive Culture I.Better financial performance 4 Copyright © 2011 by Human Synergistics International. Research and development by R. A. Cooke, Ph.D. and J. Clayton Lafferty, Ph.D.

5. 5 In a study of 69 companies across a variety of industries… Profitability (Over 3 Year Period) 1 Strength of Cultural Norms 2 Earnings/Sales Ratio (n=69) Earning/Sales Volatility (n=60) Constructive+0 Passive/Defensive00 Aggressive/Defensive0++ +/- signifies positive or negative correlation significant at p<.05. ++/-- signifies positive or negative correlation significant at p<.01. 0 signifies relationship is not statistically significant. 1 Financial data for the three-year period provided by Towers Perrin for 69 companies in various industries. Ratios are averages for the three-year period; volatility scores are standard deviations. 2 Organizational culture data provided by Human Synergistics, based on factor scores. Research conducted by Robert A. Cooke, Ph.D. Copyright © 2003 by Human Synergistics International. …there were positive correlations between Constructive cultures and profitability and Aggressive/Defensive cultures and sales volatility.

6. 6 In a study of 79 newspapers… Strength of Cultural Norms 1 Profit 2 Constructive+ Passive/Defensive0 Aggressive/Defensive0 N=79 newspapers; one-tailed correlations with list-wise deletion. + signifies positive correlation significant at p<.05. 0 signifies relationship is not statistically significant. 1 Organizational culture measured by Organizational Culture Inventory®, based on factor scores. 2 Regression residual of profit not explained by revenue and circulation strata. Analyses by Robert A. Cooke, Ph.D. Copyright © 2003 by Human Synergistics International. …there was a positive correlation between Constructive cultures and profitability.

7. From Martin I. Klein, Corporate culture and store performance: Differences among high and low performance stores, Ph.D. Dissertation. Philadelphia: Temple University. High Sales GrowthNo Sales Growth Research and development by Robert A. Cooke, Ph.D. and J. Clayton Lafferty, Ph.D. Copyright © 1973-2011 by Human Synergistics International. All Rights Reserved. 7 Constructive cultures are stronger in stores with high sales growth than those with no growth Constructive cultures matter

8. Improved culture and financial performance at Ohio State Medical Center Culture in 2000Culture in 2003 “I have worked with the Organizational Culture Inventory® from Human Synergistics for many years and have found it to be an extremely effective tool for measuring, monitoring, and changing culture.” Fred Sanfilippo, MD, Ph.D. Senior Vice President and Executive Dean for Health Sciences Dean, College of Medicine CEO, The Ohio State University Medical Center From Optimizing Human Performance in the Health Care Industry. www.humansynergistics.com. Copyright © Human Synergistics International. Research and development by Robert A. Cooke, Ph.D. and J. Clayton Lafferty, Ph.D. Copyright © 1973-2011 by Human Synergistics International. All Rights Reserved. Constructive cultures matter 8

9. 9 Improved culture and financial performance at Lion Nathan 1998 20002002 1996 2004 Net Profit After Taxes in Millions of Australian $ From Q. Jones et al. (2006). In great company. Human Synergistics New Zealand. Research and development by Robert A. Cooke, Ph.D. and J. Clayton Lafferty, Ph.D. Copyright © 1973-2011 by Human Synergistics International. All Rights Reserved. Constructive cultures matter

10. 10 Constructive Cultures Matter Better Financial Performance Does your organization have a Constructive Culture? Research and development by Robert A. Cooke, Ph.D. and J. Clayton Lafferty, Ph.D. Copyright © 1973-2011 by Human Synergistics International. All Rights Reserved.

11. The Benefits of a Constructive Culture I.Better financial performance II.Positive customer experience 11 Copyright © 2011 by Human Synergistics International. Research and development by R. A. Cooke, Ph.D. and J. Clayton Lafferty, Ph.D.

12. 12 In a study of over 280 units from a variety of organizations and industries… Product/Service Quality 1 Strength of Cultural Norms 2 Department Quality (n=321) Organizational Quality (n=287) Constructive++ Passive/Defensive-- Aggressive/Defensive--- Zero-order correlations conducted at unit-level. +/- signifies significant correlation at p<05. ++/-- signifies significant correlation at p<.001. 1 Data on quality based on Human Synergistics’ Organizational Effectiveness Inventory®. 2 Organizational culture data provided by Human Synergistics, based on factor scores. From Janet L. Szumal, Reliability and validity of the OEI. Copyright © 2001 by Human Synergistics International... …there was a positive correlation between Constructive cultures and service quality and negative correlations between both Passive/Defensive and Aggressive/Defensive cultures and customer satisfaction.

13. 13 Constructive cultures translate into constructive customer service styles… …which have a positive impact on customer satisfaction, loyalty, and advocacy. Customer data on service styles and satisfaction, loyalty, and advocacy from Customer ServiceStyles™ Feedback Report. Research and development by Robert A. Cooke, Ph.D. and J. Clayton Lafferty, Ph.D. Copyright © 1973-2011 by Human Synergistics International. All Rights Reserved. Constructive styles matter

14. 14 In a study of 79 newspapers… Strength of Cultural Norms 1 Readership 2 Customer Satisfaction 2 Constructive+0 Passive/Defensive00 Aggressive/Defensive0-- N=79 newspapers; one-tailed correlations with list-wise deletion. +/- signifies positive or negative correlation significant at p<.05. ++/--signifies positive or negative correlations significant at p<.01. 0 signifies relationship is not statistically significant. 1 Organizational culture measured by Organizational Culture Inventory®, based on factor scores. 2 Based on surveys of newspaper readers carried out by the Readership Institute (Northwestern University). Analyses by Robert A. Cooke, Ph.D. Copyright © 2003 by Human Synergistics International. …there was a positive correlation between Constructive cultures and readership and a negative correlation between Aggressive/Defensive cultures and customer satisfaction.

15. 15 Constructive Cultures Matter Better Financial Performance Does your organization have a Constructive Culture? Positive Customer Experience Research and development by Robert A. Cooke, Ph.D. and J. Clayton Lafferty, Ph.D. Copyright © 1973-2011 by Human Synergistics International. All Rights Reserved.

16. The Benefits of a Constructive Culture I.Better financial performance II.Positive customer experience III.Greater employee engagement 16 Copyright © 2011 by Human Synergistics International. Research and development by R. A. Cooke, Ph.D. and J. Clayton Lafferty, Ph.D.

17. 17 In a study of over 290 units from a variety of organizations and industries… Commonly Used Indicators of Engagement 1 Strength of Cultural Norms 2 Employee Satisfaction (n=291) Employee Motivation (n=320) Intention to Stay (n=463) Constructive+++ Passive/Defensive--- Aggressive/Defensive--- Zero-order correlations conducted at unit-level. All correlations significant at p<.001. 1 Data on employee engagement based on Organizational Effectiveness Inventory®.. 2 Data on culture based on Organizational Culture Inventory®. From Janet L. Szumal, Reliability and validity of the OEI. Copyright © 2001 by Human Synergistics International. …there was a positive correlation between Constructive cultures and commonly used employee engagement indicators.

18. 18 One health care organization found that Constructive teams had high levels of employee satisfaction High Satisfaction TeamsLow Satisfaction Teams Research and development by Robert A. Cooke, Ph.D. and J. Clayton Lafferty, Ph.D. Copyright © 1973-2011 by Human Synergistics International. All Rights Reserved. After this measurement, the low satisfaction teams embarked on a culture change journey. Recent measurements show these teams moving toward achieving high employee satisfaction. Constructive cultures matter

19. Companies selected from Canada’s “Top 100 Employers,” “50 Best Managed Companies,” and Hewitt Associates “Top 50” Research conducted and published by First Light PMV. Report available at: http://www.hscanada.com/FirstLightstudyonBestCompaniesinCanada.pdf Research and development by Robert A. Cooke, Ph.D. and J. Clayton Lafferty, Ph.D. Copyright © 1973-2011 by Human Synergistics International. All Rights Reserved. 19 The “Best of the Best” companies in Canada have Constructive cultures Current Culture Profile (Composite) n=882 members from 43 of Canada’s “Best” Organizations Constructive cultures matter

20. 20 Constructive Cultures Matter Better Financial Performance Does your organization have a Constructive Culture? Positive Customer Experience Greater Employee Engagement Research and development by Robert A. Cooke, Ph.D. and J. Clayton Lafferty, Ph.D. Copyright © 1973-2011 by Human Synergistics International. All Rights Reserved.

21. The Benefits of a Constructive Culture I.Better financial performance II.Positive customer experience III.Greater employee engagement IV.Higher levels of productivity 21 Copyright © 2011 by Human Synergistics International. Research and development by R. A. Cooke, Ph.D. and J. Clayton Lafferty, Ph.D.

22. 22 Constructive cultures are stronger in the Department of Defense’s top performing units than its average units Top Performers Average Performers Culture profiles of units within the U.S. Department of Defense during Operation Desert Shield. From Janet. L Szumal, Organizational Culture Inventory Interpretation and Development Guide. Copyright © 2003 by Human Synergistics International. Constructive cultures matter

23. 23 The most effective and successful leaders drive Constructive cultures Impact of the Most Effective and Successful Leaders* Impact of the Least Effective and Successful Leaders* Research and development by Robert A. Cooke, Ph.D. and J. Clayton Lafferty, Ph.D. Copyright © 1973-2011 by Human Synergistics International. All Rights Reserved. Constructive cultures matter *Top 10% versus bottom 10% of leaders within major corporation. Leaders’ impact on culture measured using Leadership/Impact®; effectiveness based on ratings by superiors, peers and direct reports; and success based on performance-based salary increases over time.

24. 24 Constructive Cultures Matter Better Financial Performance Does your organization have a Constructive Culture? Positive Customer Experience Greater Employee Engagement Higher Productivity Research and development by Robert A. Cooke, Ph.D. and J. Clayton Lafferty, Ph.D. Copyright © 1973-2011 by Human Synergistics International. All Rights Reserved.

25. 25 What is a Constructive Culture? Copyright © 2011 by Human Synergistics International. Research and development by R. A. Cooke, Ph.D. and J. Clayton Lafferty, Ph.D.

26. Constructive Cultural Norms Achievement (11:00) Self-Actualizing (12:00) Humanistic-Encouraging (1:00) Affiliative (2:00) Research and development by Robert A. Cooke, Ph.D. and J. Clayton Lafferty, Ph.D. Copyright © 1973-2011 by Human Synergistics International. All Rights Reserved. 26

27. 27 Culture happens. Leaders and managers can let it happen or they can manage what happens. It is a choice. Copyright © 2011 by Human Synergistics International. Research and development by R. A. Cooke, Ph.D. and J. Clayton Lafferty, Ph.D.