In this session, learn how culture impacts recruitment and retention and a simple tip you can use to get insight into your own company's culture.

About our speakers

• Stephen Utech runs Illumyx, a consulting firm that allows leadership teams to get a pulse on their culture and improve business results as an outcome of this insight. Learn more about Illumyx at www.illumyx.com.
• Justin Vajko runs Dialog, a recruitment marketing agency for blue collar employers in Wisconsin and Minnesota. We use social media, videos, and online reviews to help great employers attract great talent. Learn more about us at www.recruitwithdialog.com.

Justin Vajko: Hey, everyone. I want to introduce Steve Utech here. Steve runs a company called Illumyx and he specializes in, if I understand this right, Steve, helping organizations understand their culture and how to use that to achieve bottom line business results. Did I get that right?

Stephen Utech: That's a great summary. Yeah, probably better than I could summarize it.

Justin: Okay, good. Well, I am in marketing. So Steve, I have a question for you. You know, we talk about culture a lot at Dialog. We talk about it a lot, all the time. We're not the culture experts. I think you guys are. So I want to ask the first question. What is culture? 

Stephen: Someone shared with me a simple definition that I've been using for a while, that culture is how you get work done. So that might involve behaviors or attitudes, beliefs you have about work philosophies, but it's the collective way that people get work done.

Justin: I like that definition.

Stephen: And that allows for some variation, because accountants are going to approach work slightly different than someone in a sales team. But within that variation, there's usually some core binding principles that keep people together.

Justin: OK. I was looking at your website a little bit. One of the challenges it sounds like a lot of companies have is, when they've got these obstacles and they've got these complex challenges of doing this, but we're still getting this result and we think it's a culture problem. What are some symptoms that can often come up? You talked about what different groups have for culture. What are some symptoms that you see as a common theme, where somebody would need your help to work on culture?

Stephen: Okay. Yeah. That's a great question. First off, I don't necessarily view them as problems, because what happens is, companies grow or they develop and essentially they go through different stages like puberty and they don't realize that they're going through puberty, and some of these growing pains are normal. So I think one of the downfalls that some organizations have is they're like, "Oh, we're having these problems that let's not look at them or let's try to work harder to overcome them somehow." Instead of just slowing down and going, "Hey, what's going on here? How can we learn from this? And maybe we need to change how we operate." So culture's not a static thing. So it's got to evolve as you grow, because what worked when you're five people, is not going to work when you're 150 or a thousand. So one of the common symptoms I see is, a lot of siloing, organizational siloing. So people get stressed out, how things worked at one point when you're small, doesn't work as well for collaboration. So you have people that stop working together, workflows break down across departments and functions.

Stephen: And then when that happens, then you start seeing trust issues develop, you get conflict where people throw things over the wall, they don't really get resolved. And then, perceptions of accountability and fairness get all skewed, because you get focused on your department or your area or your role. And it's like, "Well, I'm doing my job, but they're not doing their job." And organizational fairness tends to be a really big deal for people when they feel like they're getting a bum wrap, even if it's not really based in reality. So usually, I find people are working hard regardless. It's just that you get these misperceptions that develop over time, because you're stressed and overworked. And it's natural to feel sorry for yourself.

Justin: Right. Misperception is so interesting to me that a culture can come out of misperceptions. You said, as companies grow, often one of the things that can happen is, they ignore certain parts that need to be addressed. What are some of those things that need to be addressed? If a company could look at one, two or three things on a regular basis, what would those things be that you'd recommend, in order to avoid coming into a situation where years down the road, now you've got this culture of silos and misperceptions and things like that?

Stephen: Ooh, I'll do my best to answer that question. There's a lot there, but I would say, when you're small, just being okay with not being super structured. Too much structure is going to slow you down. But realizing that, as you get bigger or busier, you need that structure to help scale. And I think, when companies go through that transition, a lot of times employees will view it, "Oh, we're getting corporate or we're losing our way or losing our path." No, you just gotta grow up. And some employees might be... Maybe they're just great at that early stage stuff, where it's a little bit structured, very nimble, kind of fun and exciting, flying by the seat of your pants. And maybe they never want to grow up, and that's okay. Actually, crap. What was your question again, Justin?

Justin: Yeah, that's fine. What are some of the things that you see those growth pains that get ignored, I guess, to use the analogy of growing. Things that, if entrepreneurs and CEOs and executive teams, managing teams could have an eye on that and not ignore it, would prevent some of these things down the road.

Stephen: Oh, one of the common things that forms in a growing company is this thing called... Well, clicks where one function of a business is dominant. So you might be in a manufacturing setting and you say production or manufacturing or operations is king. Other groups might be like sales is king, but usually, one function tends to dominate. And what's really important at that stage, is for the executive team or that CEO to set a real clear vision and say, essentially, one function is not going to dominate. This is about how we are together and take some ownership, that things are going to get inefficient for a while, because if you're going to scale and figure out how to unite people.

Stephen: It's going to be an inefficient process in the companies that have been successful, they've taken the time to build infrastructure around culture or infrastructure around metrics and process, but they're really trying to build a strong business and it just takes some time and being okay with that. So, sometimes those functions that were dominant, that helped get you to where you are, they got to take a little bit of a backseat to help the organization get reorganized.

Justin: I could see two reasons why an entrepreneur would ignore certain things like you just said. The first that comes to mind is time. Well, I don't have time to fix this problem we're trying to grow. And the second thing I can think of is, I don't know how to address this problem. If they're aware of it even, I would say, maybe a lot of entrepreneurs aren't aware of the problems in their business, because from what my experience is, a business grows around the strengths and weaknesses of an entrepreneur. But let's say, there's an executive team of some kind and they see this. What is some advice you'd give to a team like that, an executive team, managing team that sees, yeah, we've got this problem. We just don't know what to do about it. Is it as simple as hiring you? What are some resources or ideas you have for addressing some of these really complicated, messy human problems?

Stephen: Yeah. They could always hire me, but that's a really simplistic answer. Simple thing to do is just to talk to people. We don't have to come up with any crazy solutions. The employees actually have insight and perspective. And maybe some of the magic that we do is just weaving those stories together into a coherent message, so people understand. Because, when you're leading a company, you're getting a lot of BS piled on your lap. You don't know what's real, what's not. So it can be really hard to sort it all through, but I've seen some CEOs just literally, just go onto a production line and pull people off and start asking them, "Hey, what's going on? What's your experience? How do things work? What's your pain points?" And it can be a bit time consuming, but that can be pretty powerful when the leader of the company, asking you questions about how things are going for you.

But yeah, it's just difficult for most executives, because it's lonely at the top and it's hard to get a really good view of how the inner workings of your company are, what they actually are when you're that far removed from it.

Justin: Yeah. Right. It makes sense. What you're talking about reminds me, just that simple going to the production floor and pulling people aside and asking them questions and open ended questions, maybe. And it reminds me of the show Undercover Boss a little bit. Have you ever seen that show?

Stephen: Totally. It's a great show.

Justin: Yeah. Just that idea that there are things that are going on that, if you just open up that line of communication, you might get insights that answer your problems for you. Maybe there's a lack of what we often see, because we work with companies all the time on communication problems. What we often see is, there's an internal communication issue, sometimes. It's like, well, this person has this complaint, but clearly this is being addressed by the company. They just don't see it yet. So like you said, maybe it's a silo issue. Maybe it's a miscommunication issue.

Stephen: Actually that's a really good point, Justin, because half the time like things are being done.

And employees don't see it and then, they keep complaining or... Not complaining, but they keep on voicing their concerns and then you see leaders going, "Well, dang it. What the heck?" And they start feeling resentful. And then, you see this rift occur between people. Oh man. I was working with an HR leader who is a former, I think DuPont person. And they had a really cool thing they shared with me, where they would do these, I think monthly presentations, the CEO would do. And they would have these simple slides that said, "This is what you said, this is what we did.” And they would just try to make it as explicit as possible. "You said this, we addressed it this way." And I was like, this is simplistic and beautiful, because it's so easy to just assume that like, "Oh yeah, we addressed your concern", but then never say anything about it.

Justin: I've learned a lot about interpersonal communication recently and one of the best ways you can help with communication is, making sure the other person feels heard. And the best way for someone to feel heard is literally, just repeating back to them what they said in your own words. And it's amazing how people feel like, "Okay, yeah, you get what I'm saying." And then, you can talk about the next step, but that part alone is just huge for that empathy. And it sounds like that step of just, this is what you said, that alone would be impactful.

And just even addressing it partially, would be good because guess what, you've done the bulk of the work and sounds like of just being empathetic with your employees complaints and putting it out there in the open and not making it feel like, "Well, I threw my complaint out there into these surveys, but nothing ever seems to be done." We've seen that in some of these internal surveys. We do a lot of surveys, nothing... Well, things are probably getting done. Just maybe not those specific complaints aren't being overtly brought up and then addressed what's being done about it. That's a really great tip, Steve. That's a really great tip.

Stephen: Yeah. And change takes time too. And you'd be surprised at how, not obvious certain things are. So something can be implemented. People have just no idea. You just don't know.

Justin: Right. They don't. Yeah, that's very true. What seems simple to one person, is often a complete mystery to someone else. So can you tell us any good stories, maybe one good story of a before and after situation. You've touched on a couple. What's one that comes to mind when I say, tell me a good culture change story that Illumyx was a part of.

Stephen: Oh yeah. This is a communications company in the South. I think it was in Arkansas. And it was interesting, because they were a family run business. I think they had been around for multiple generations and they had just some professional managers that came in to run it. And while they were still making money, morale was in the tank, really, really bad.

I think to the point where maybe they did some leadership change or turnover, so brought a new leader in and he wanted some help diagnosing the culture and figuring out, "Okay, how do I steer this ship and take it from this status quo family business and start reimagining it and growing it significantly?" And when I say communications companies, it was telecom.

Stephen: So, cable TV, internet, things like that, but more of a rural provider. So I remember when he first came in, they got their results back from their survey and it was just abysmal, just brutal. We used this color coded heat map to illustrate things. And it was just all red. It was like a deer that just got shot and that was just laying on the side of the road, but I was so impressed with the CEO, because he would go around to all their locations and do these town hall meetings. And he would say, "It was just a bloodbath." Either it was dead silence and no one would say anything and just an awkward hour or people would just be getting up and yelling. But he said the fear and anger were just palpable.

Stephen: There were two things, it was either anger or people were afraid and wouldn't talk. To the point where, I think their first survey, they were like, "We couldn't even have any demographic questions to slice and dice the data, because people were so paranoid about the survey or just being honest that they were going to get fired." So I would just say, this leader was just extremely transparent. And he was able to take a lot of bullets and a lot of heat and not be defensive about it. And just try to understand it, as you were saying before, and work it through like, "Okay, how do we take your concerns and do something about it?"

Stephen: And then with that, he ended up forming this culture team, which is becoming more common to have a change management strategy, where you have a group of employee stakeholders that are influencing the change. And I really liked this team, this culture team, I think it was 20 people at first who were tasked with helping to change the culture. They kept on going to him for feedback and going, "Well, tell us what to do, tell us what to do." And he was very adamant and he's like, "This is your initiative. I'm here to give you some guidance.

Stephen: I'll make sure you're not veering too far to the left or the right or going off course, but you guys got to own this." And they started freaking out at first and we helped guide them and make sure they had some things to take care of, but they would start meeting with employees and uncovering some of these issues and addressing them, and became this really cool self-sustaining group, where employees started viewing them like, "Oh, okay. We do have a voice. We can go to this culture team to help us work through any challenges we have. And they're hearing us, they're listening to us. They're moving forward."

Stephen: So long story short, five years of this. And now, they're at an employer of choice status.

Justin: Wow.

Stephen: The culture team initially, their mantra, their vision was to build pride in the company again, because an employee said they would go to their grocery store and if they had their company logo or apparel on, they said they would hide it because they would be embarrassed.

Justin: Wow.

Stephen: And now they're like, it's actually fun to recruit people to the company, because of how much they've transformed it.

Justin: Wow. That is a really cool transformation story. Thank you. Yeah. That's a rare thing. I think a lot of companies don't realize the impact of culture and things can be done about it. I think a lot of us have worked in companies where it just feels inevitable, that culture should be that way. But that story shows and proves. Boy, if you've got the courage with a capital C, to withstand some of that initial pushback and you have an open mind and you want to get to the bottom of it, there is a way to turn a company around. But boy, that sounds like a really powerful leading from the front, really courage leading to get to that point in that kind of situation.

Stephen: And it was top down leadership, but then also, bottom up engagement.

Justin: Yeah.

Stephen: Which takes time and then measurement and then, "Okay, let's try to make improvements on what's not working the best."

Justin: So that's where you guys will get a little techy about what you guys offer with Illumyx. You measure, what is it, eight different areas of culture?

Stephen: Yep. So generally we measure eight dimensions of culture, but then beyond that, most companies will help them measure their organizational values, and then any other principles they might have. So it gets really tailored into who they are, what they're all about. And we find that that actually helps engage people into the project. So it's not just a typical engagement survey, there's some meaning and meat behind it. And that allows them to just get better at themselves. But we also look at, where they're at developmentally, as an organization. Are they really young and at the infancy stage? Are they going through puberty and are a little bit chaotic and all over the place? Or are they really mature and just have a well oiled machine that is churning out money? So that's really helpful, because we could provide some guidance on what they need to do to continue to mature, or even to get younger. Maybe they're too old and stodgy and they need to have a little bit more nimbleness in their approach.

Justin: Yeah. That makes sense. Okay. And you give these reports, you've got visual ways to look at them and you're actually measuring culture.

Stephen: Yep.

Justin: At Illumyx. Okay. Which is a very interesting process. I think a lot of people probably would not expect that you could measure your culture, but you guys have found a way to do that and it sounds like, get some really nice results out of it, just by measuring it.

Stephen: Yep. Most definitely are.

Justin: What's something that surprises you, or still surprises you after all these years of being in this world of culture building. Is there anything that still surprises you? Or have you seen it all and you're like, "Yeah, that doesn't surprise me."

Stephen: That's a great question. Oh, this doesn't happen as often, but when a group, usually it's not a CEO, but usually it's a department leader, when they have information and they don't want to do anything with it or they try to find excuses. It's really difficult to watch, because then it's like, "Oh, you're just missing out on a golden opportunity here." And things almost always get worse, when you solicit input and you, and you don't take action with it. And usually, it's rooted out of fear, but it becomes a self-fulfilling prophecy. It's this hidden fear of, "I don't want to look at it, because I don't want to know. And maybe it'll just go away." But it almost invariably gets worse. And it's like watching a car accident that you can see coming from a while away.

Justin: Oh yeah.

Stephen: So that shouldn't be surprising, but I guess it is surprising and it's more of like, "I wish people would have a little bit more courage at times to look at themselves and not be so afraid of learning."

Justin: Yeah. That makes sense. Well, this whole series we do is about recruitment and retention. Let's get to that topic and then we'll wrap it up. But what are some of the expectations somebody can have? What is maybe a good case study or a good example of recruitment improving, when you work on your culture? Obviously, I like to say all the time, "If you work on your culture, recruitment will improve, retention will improve." Do you guys have the data to back that up?

Stephen: Yeah, we do. With certain organizations, and although caveat right now is such a weird time in the labor market, where I've never seen employees so empowered, or just people on the job hunt. In a lot of ways, it's becoming more money centric. So that probably isn't good for us long term. But we can help with helping to figure out proper pay vans to make sure people stay. But it just takes time. I think the big thing is making sure what you're communicating, what you're pitching, what you're selling and your recruitment messaging, is matching the experience that employees have. And when companies can walk the walk, talk, talk, and their recruitment message matches the culture they have, that creates a really, really fantastic onboarding experience. And that, I don't know... Synchronicity? We'll just say, just jives pretty well.

Justin: So there's no shock when they get in and think, "Oh, well I've been sold bowl of crap here." 

Stephen: I've had a couple of companies I wanted to toss your way, but they're like, "Oh, not yet, man, because we got some work to do. Because any marketing message we come up with is going to be disingenuous." Unless we want to say, "Hey, come work for a really disorganized, chaotic hell hole."

Justin: Yeah. That's right. Put all your dirty laundry out there. Yeah.

Stephen: Exactly. They're like, "We're trying to make it better. Just give it some time."

Justin: Yeah. Okay. Well, cool. Well thanks, Steve, for this time. I always like to have three takeaways. I got... Well, I do have three takeaways. So first one is, if somebody wants to work on their culture, improve some things in their company, improve efficiencies, improve recruitment retention. One of the first things they can do is, not ignore the problems and they can talk to their people. So talk to their people out on the floor, CEO, manager, just go down to the floor, get that firsthand information. That alone might yield some beautiful fruit that they can use and run with, and make adjustments.

Justin: And then when you do make adjustments, communicate what people have said and tie it back to what you've already done. Even if it's a little nibble at that problem, empathize with what someone said. And then tie back. And then the third thing is, what we just talked about, communicating, having a good culture, and then communicating that clearly, doing those well is really going to help with the recruitment and the retention. There's no unmet expectations, no shock there. Anything else I missed, that you would add to that list that someone should have as a takeaway?

Stephen: Nothing to add. But I would say, if you're a work in progress as a company, just own that. And even just, if you're interviewing some folks and just say, "Hey, we're trying to go from here to here. We need you to help us get there." And that might be, "Hey, we're trying to get more planful or more disciplined. And we need you as a potential prospect to help us get there, knowing that it's going to be challenging and we might throw some wrenches in your game and you might get frustrated with us." I think that kind of honesty could be really refreshing.

Justin: I totally agree.

Stephen: You don't need to have it all together, but be honest.

Justin: I like that. I like that a lot. And you don't have to have it all together. Let's add that as a fourth item, and be real about it. You don't have to have it all together, as long as you're real about it. Well, Steve, thanks for your time. And it was good chatting with you and we'll talk to you later.

Stephen: All right. Thanks Justin. Have a good one.