To start, what are covert processes?
Unlike overt processes, which can be observed, covert processes are hidden, unspoken, and unacknowledged. They are the collective unconscious dynamics that exist within organizations that regularly impact the interactions and responses of people within the organization. If change management leaders do not account for them in their plans, these processes or dimensions can impact the workflow and stand in the way of achieving organizational goals and change objectives. It is important to know that covert dynamics occur outside of our awareness and you and your employees can be engaging in them without knowing it.

The 6 dimensions of change
Marshak lists six dimensions of change: Reason, Politics, Inspirations, Emotions, Mindset, and Psychodynamics. The first is the only overt dimension out of the six whereas the latter 5 are covert.

1) Reason
Reason is the only overt dimension and shows up when organizations are making the case for change. It is the rational and logical process organizations follow to come up with a compelling reason for why they need to implement a change. Today, reason is paid the most attention to when planning for organizational change. Organizations understand that they need to make a change to survive and remain competitive.

This of course is a very important part of any change initiative to get buy-in. However, solely emphasizing on it, negatively impacts the change process. This tunnel vision can reduce common and expected resistance to irrationality, when in fact it is the result of other dismissed yet valid and powerful forces. Therefore, it is important to account for the five other covert dimensions that can hinder any well thought out change effort.

2) Politics
The covert dimension of politics refers to the events in which individuals, teams or work units work towards their own interest. While this kind of behavior is deemed inappropriate in work environments, it is something that is bound to occur. It might even be the case that the change effort itself was initiated to fulfill a groups’ or maybe a leader’s own interest. Therefore, it is quite necessary to anticipate what political dynamics might surface when managing a change and think through the different courses of action to take to address them.

3) Inspirations
Marshak describes Reason as the head and Inspirations as the heart. Making the case for change rationally is not enough to get the ball rolling; people need to be inspired to be bought in. So change efforts need to be accompanied by value-driven vision statements that evoke inspiration; the third dimension. It is important to look beyond the numbers and logic and inspire people to do ‘better’ or ‘be more impactful’ or ‘make a difference’. This covert dimension of organizational change can be quite powerful. When unaddressed, it can be a missed opportunity for moving change along more smoothly. Moreover, reason might at times clash with and oppose unspoken yet existing values within your organization if both are not addressed, which in turn can hinder the change effort.

4) Emotions
With any change comes a normal and predictable wave of emotions across the organization. Some of these emotions can be acceptance or excitement, but they can also be denial, anger, fear, or sadness. More often than not they are expected to be hidden and unexpressed as they are considered inappropriate in the workplace. However, it is important to engage the workforce and allow them to express their sentiments and emotions. Unexpressed emotions can impact the change effort and if they remain unacknowledged, they can lead to inefficiencies, delays, and maybe even sabotage. Therefore, it is just as important to make space for these emotions as it is to reiterate reason.

5) Mindset
Marshak describes the mindset dimension as the unexamined assumptions, beliefs, and premises that people have and use to interpret the world and in this case, organizational change. These mindsets are covert frameworks that we are generally not aware of having. Mindsets vary from one person to the next and can impact how change efforts within an organization are perceived. Mindsets limit the perceived possibilities of the outcome of change. Moreover, these perceptions significantly vary from one person to the next, so there is a lack of uniformity in how the change is being perceived. Not addressing this dimension can ripple into the other dimensions such as emotions and in turn negatively impact the change process. Therefore, change management includes challenging these mindsets and making them more overt, because it is only by doing so that people can recognize the limitations of their assumptions and entertain alternative possibilities and outcomes of the change.

6) Psychodynamics
The psychodynamic dimension, which includes our unconscious reactions to change, is the most covert out of all dimensions… and the most taboo and off-limits topic to bring up in a workplace. Yet, it can greatly impact any change effort. Psychodynamics might show up as defense mechanisms such as avoiding the whole change effort, arguing and fighting about it, shutting down emotionally transferring feelings for certain figures in your life to your managers or colleagues etc… and a lot of these dynamics might actually be related to other parts of your employees’ lives outside of work. While this might seem like a sensitive topic that is beyond the scope of work, it still shows up and impacts the work. So, there is something to be said about acknowledging it. I am not suggesting setting up group therapy sessions but acknowledging that these forces are at play. Acknowledgement of your own psychodynamics can help you as leaders identify how they impact your interaction with the change and in turn model to your people how to approach it.

I realize that these dimensions are relatively broad and can be dealt with in several different ways. How you choose to integrate these six dimensions into your change analysis will be highly dependent on time, resources, and the nature of your organization, leaders, and people. But, if you set the intention to go beyond Reason and address the covert Politics, Inspirations, Emotions, Mindset, and Psychodynamics, you are more likely to achieve a successful change.

Reference: Marshak, R. J. (2006). Covert processes at work managing the five hidden dimensions of organizational change. Berrett-Koehler Publishers.

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As I learned more about the “culture” change efforts that this organization had engaged in over the last year and a half, it became clear to me where it went sideways. This leader is not alone in succumbing to this common misconception about what culture is and isn’t and I felt that it was time to take a moment to clarify a few things for the rest of my readers who may be feeling similar frustrations.

The concept of organizational culture has become widely accepted as a critical component of performance in recent years. With this, I find that a great many of my discussions with leaders, often, teeter between several topics that fall within the realm of culture but are not one and the same. This reality can create some understandable confusion and frustration for people.

One common situation that I find myself running into are conversations with business leaders who are attempting to evolve the cultures of their organization but who, in reality, are focusing on organizational climate. Many business leaders tend to utilize the terms organizational culture and organizational climate interchangeably, and while they share many similarities, there are several key differences that delineate them from one other.

While both impact behavior in the workplace, helping leaders to understand the key similarities and differences between culture and climate will facilitate both engaging in dialogue and setting expectations with regard to what organizational outcomes they can hope to achieve. Additionally, both play integral roles in organizational functioning.

Climate Defined.

Let’s start with climate as it is generally viewed as the more narrow of the two concepts. Climate is comprised of a set of internal characteristics that influence behavior and that distinguishes one group from another. Climate is the more visible aspects, or manifestations, of the culture of an organization.

Climate is a measure of the perceptions of individuals in a group and it can change somewhat quickly. The transition of a key leader, a major internal or external event that impacts the organization at-large, or a change of business strategy can all have a significant impact on the climate of an organization.

Climate refers to the shared feeling of the environment and is a manifestation of how people perceive their ongoing relationship with their organization at a current point in time. It is also limited to the observable and conscious aspects of the experience that members have in their work environment.

Culture Defined.

The concept of organizational culture, however, goes much deeper to include what people believe, value, and the fundamental beliefs and assumptions that group members hold to be true about how work should be done. Culture is collectively shared amongst group members and relates to patterns of behavior that are deeply embedded in the fabric of the organization. These patterns develop as members of an organization, through trial and error, figure out what leads to success and what leads to failure.

Organizational culture is how people feel about the organization in which they are members, which is akin to climate and why people sometimes confuse the two.  Culture goes further to include the underlying beliefs, values, and assumptions that members of the group hold to be true.

Deal and Kennedy suggest that organizational culture is, “the way we do things around here.” It is a system of shared orientations and accepted beliefs that hold a group together and give it a distinctive identity that set it apart from other organizations. Culture develops over time as members of an organization experience share learning about what works and what doesn’t. Over time, the members of the organization begin to understand how to succeed in that operating environment and begin to take for granted that those ways of operating are the “right” way to do things. This is all well and good so long as the operating context stays stable and what has always worked continues to work moving forward.

Unlike climate, culture is much less dependent on individual events that occur in the day-to-day. Rather, culture tends to drive peoples’ interpretation, thinking, and perspectives of the events that occur over longer periods of time.

Primary Differences.

In his book, Organizational Culture and Leadership, Edgar Schein suggests that “Climate can be locally created by what leaders do, what circumstances apply, and what environments afford. A culture can evolve only out of mutual experience and shared learning.” Based on this assertion, a mid-level manager can have direct impact on the climate of his or her team by creating a work environment that performs at high levels despite what is going on around them in the organizational system, in effect, shielding the team from the ills of the system but, over time, the organizational culture, if not evolved to support those changed ways of working, will, most likely, exert powerful force on the team and they will eventually slide back into the collective ways of doing things.

If things are still a bit hazy for you, consider Guion’s analogy that the concept of climate is similar to the concept of wind chill- something that most people can relate to. Wind chill is simply peoples’ subjective perception of the combined effect of two objective concepts: wind speed and temperature.

Why is This Important?

So, you may be asking yourself, who cares? In the context of daily organizational function, the nuance between culture and climate may not seem like a big deal. Where the distinction becomes important for organizational leaders is when they are making decisions on where to focus their resources and what impact they can expect to see.

It is critical to tend to both culture and climate in an organizational system but with climate being the more visible and more readily changeable, it tends to be the area where most people focus. This is not wrong per se. Gaining ground where you can is certainly something. The risk of stopping at addressing climate-related topics is that those gains can be easily lost if the underlying cultural values, beliefs, and assumptions do not also evolve to support sustained behavior change through shared learning. The next time you find yourself getting frustrated at the lack of sustainability of your change efforts, ask yourself if you are focusing in the right place.

This article originally appeared on Forbes.com.

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If you do not manage culture, it manages you, and you may not even be aware of the extent to which this is happening. — Edgar Schein*

Culture, For Some, Is An Intangible

It’s elusive, difficult to define, and even more difficult to quantify. For some, the thought is that culture is not something that can be seen or measured; rather it’s something that can only be felt. And we all know how most executives feel about investing in the touchy-feely.

While it may make some leaders cringe to talk about feelings, there is truth to them and ignoring them won’t negate the fact that they are influencing performance. Culture may go unnoticed when it’s serving you well, but it’s felt when it’s derailing your organization. The feel when it’s not there is painful. And it’s when we’re in pain that we begin to pinpoint more clearly what is causing the pain. When things are going well, we don’t focus on the specifics.

Consider yourself as an organizational system for a moment. When you’re healthy, how much time do you spend appreciating the energy you have as you approach your to-do list? The ease with which you can sit at your desk, without back pain? The grace with which you can walk, bend over, or reach for things as you move through your day? But when you have a cold, a hurt back, or an injured ankle or shoulder, you can pinpoint exactly what isn’t working and the implications it is having to your performance.

Culture Is Measurable

Organizational Culture can be defined as the beliefs and assumptions that exist within an organization and drive behaviors within and across teams. The implications of healthy and unhealthy cultures are felt, and are measureable within organizations.

Ask any company that has understood the impact of their culture as it relates to things like employee engagement, retention, process improvement, error rates, cost savings, and customer satisfaction. The ROI of corporate culture is undeniable. When the culture is healthy, these performance metrics are thriving. When elements of the culture are not aligned, either to the vision and mission, or across teams in the organization, these metrics start to decline.

Often, the responsibility for creating or communicating the culture of a company lies within HR or Training, and sometimes within Purchasing.  Oftentimes, those assigned to “mind the culture” are left scratching their heads while they do their best to answer questions like these- What do we include in our orientation? What is our employee brand? When can we purchase those cool Herman Miller Aeron chairs? Can we get a foosball table up in here?

While I would argue that the responsibility for culture begins with leadership and becomes a responsibility of each employee, these functions are in a position to communicate the implications of the culture. HR, Training and Purchasing are improving year-over-year in their ability to make evidence-based decisions about where and how to invest in strategic initiatives. And culture is among those. They are collecting and reviewing employee satisfaction measures, they are reviewing competency data to ensure the organization has the necessary capability to serve the customers, they are paying attention to costs and determining where to invest and where to save yet still be able to conduct business and deliver quality. What these functions don’t have ready access to is what, specifically, in the organization is driving these measures.

Consider the added value to your organization if your employees were able to make decisions at the level where the best information was available, without ignoring or passing along problems. What if people were able to coordinate projects across different parts of the organization, and did so in a consistent and predictable way? We might expect to see an increase in employee satisfaction and quality of work.

What if your leaders and employees identified new and improved ways to do work and adapted to competitors or changes in the business environment? What if they also sought to cut costs with as much diligence along the way? Customers might be more satisfied with your offerings, and sales growth has the potential to soar.

How good would it feel if your mission gave meaning and direction to the work your employees show up to do each day, and that they understood what needed to be done in order to succeed in the long run?

Being part of a profitable organization feels pretty good. In Corporate Culture and Performance, John Kotter and James Heskett provide insight into how the culture of an organization impacts its performance, for better or for worse, as evidenced in firms such as Hewlett-Packard, Xerox, ICI, Nissan, and First Chicago. In fact, they found that companies that invest in communicating their vision, mission and values recognize their profits climbing as much as 750% higher!

It Is Imperative That We Measure Culture

However intangible or touchy-feely it may seem, measuring the bottom-line ROI of culture is possible. And it begins and ends with having the right data on hand. The first step is to begin with a deep understanding of your organization’s current state as well as where your organization needs to go from a strategic perspective.

Without deliberate assessment of your current culture, you are, at best, making decisions based on feel. With the evidence provided through a collection of data, both self-reported feedback as well as organizational measures, leadership is better positioned to make decisions about how to prioritize other strategic initiatives, how to allocate investments, which levers to pull through the course of doing business and supporting clients in a consistent and quality manner.

It is a necessary corporate stewardship to arm those who are making decisions with data that reflects the current health of the corporate culture and the implications it’s having, or will have, on performance.

Investing in employee engagement? How do you know what levers to pull to ensure that sustains and continues to align with your vision/mission/strategy? Investing in LEAN process improvement? How do you know where to further refine or adjust process steps or ownership in order to maintain operational reliability and still serve the changing needs of the customer?

As you entertain the question of what ROI might be for your investment in culture, ask first what investment you have made toward sustaining or improving corporate performance. Then ask what the annual value would be if those investments could be optimized. Divide by the ‘$ per employee’ investment in undertaking a culture initiative, and multiply that by 100. You’ll have an indicator of your ROI for investing in culture, and you’ll be one step closer to a healthier, and more sustainable organization.

* Quote Citation: Schein, E. H. Organizational Culture and Leadership, 4th Ed. Wiley, 2010.

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