"Diversity and inclusion begin with core values."
Daniel Edds, MBA is a management consultant who helps organizations develop high-impact cultures. He is the author of two books. The most recent is titled, Leveraging the Genetics of Leadership, cracking the code of sustainable team performance. This book documents how high-impact organizations transform their cultures to engage the full breadth of the human opportunity, teams that build community while also delivering unparalleled customer value. In addition, Dan serves on the boards of several community-based nonprofits.
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CEOs and leaders usually have different motives and aspirations when getting started. Let’s go straight to the beginning. What was your primary goal for starting your business? Was it wealth, respect, or to offer a service that would help improve lives?
Daniel Edds: At its core, I believe that good consulting is not only helping an organization serve its clients and stakeholder better but that the way to do this is to capture the wisdom and passion of the workforce. Customer value is created by employees. Therefore, supportive culture is mandatory to deliver the highest customer value. After working with over 200 different organizations, every time I found an organization that was failing in its mission or failing to serve its clients, I found an organization where senior leaders were failing to support their people with the tools and resources they needed to be successful – no exceptions.
Tell us about 2 things that you like and two things that you dislike about your industry. Share what you’d like to see change and why.
Daniel Edds: The first challenge I have about consulting, in general, is that too many are so focused on data that they fail to get a broader perspective. Data only tells part of the story, and seldom does the data describe the human element. For example, in one project we discovered that a customer support phone system was dropping 1400 calls per day. What these data do not explain is that on any given day there was only 6 customer support staff out of 10 to answer the phone. People would do almost anything not to come to work. I would love to see consultants do more work to capture the voice of the rank and file employees who are actually creating value for customers.
The second challenge is too little attention paid to organizational leadership systems and culture. Leadership is understood as a personality trait of individuals and is seldom understood as the platform on which culture sits. Great cultures always are supported by great organizational leadership. Great organizational leadership is always about a prescribed set of values, behaviors, routines, and roles that every leader is asked to model and produce. I have found this to be true in both my consulting practice and in the research for my latest book. I would love to see this personality-centric focus on leadership modified to understand the role and value of systemic leadership. Annually, the US spends an estimated $50 Billion in leadership development. Yet researchers from Harvard, Stanford, McKinstry, and Gallop are concluding there is little evidence of any ROI. George Clifton, CEO of Gallup put it best in a report on the American workplace, “The American leadership philosophy simply doesn’t work anymore.”
Companies around the world are rapidly changing their work environment and organizational culture to facilitate diversity. How do you see your organizational culture changing in the next 3 years and how do you see yourself creating that change?
Daniel Edds: Diversity and inclusion begin with core values. The most common core value for many organizations is respect. Yet few organizations ever define what respect looks like. The same can be said for values such as integrity. For example, when organizations like Boeing, Wells Fargo, and Volkswagen falsify data, cut corners on safety and put short-term profits over long-term customer value, they make a mockery of their values. For these companies, the results were $Billions lost in shareholder value, and with Boeing, hundreds of lives were lost because its airplanes crashed. Employees know what the real values are.
When organizations identify core values, they must take the second step by defining specific behaviors that support them. For example, a hospital with one of the world’s best safety records (in the US 161,000 people die because of accidents in hospitals) has a single core value of respect. However, they have ten foundational behaviors they expect every leader and manager to model.
Diversity and inclusion will become part of the cultural fabric when specific behaviors of leaders are tied back to core values. When they violate those values there is accountability. Likewise, when the model core values, there are rewards. Thus, any cultural change must also incorporate changes to the reward system.
According to the Michigan State University “An organization’s culture is responsible for creating the kind of environment in which the business is managed, and has a major impact on its ultimate success or failure.” What kind of culture has your organization adopted and how has it impacted your business?
Daniel Edds: In my research that is the subject of my most recent book, there is no “one size fits all” culture. Culture is dependent upon the business, its mission, and its customers. Here is a list of cultures and the business each represents:
- A culture of high employee engagement, where every employee is supported to find and eliminate waste in the design and manufacturing of custom commercial furniture.
- A culture of collaboration to support high academic achievement in an elementary school with an ethnic and economically diverse student body.
- A culture of patient safety where every employee is supported to “speak up.” This urban hospital is annually recognized as one of the safest hospitals in the nation.
- A culture of empowerment: empowered employees, empowered patients, and empowered community. This hospital is community-owned and operated and the mission is focused on community health.
The lesson, each organization needs to determine its best culture that will engage its employees and deliver maximum value to their customers.
Richard Branson once famously stated “There’s no magic formula for great company culture. The key is just to treat your staff how you would like to be treated.” and Stephen R. Covey admonishes to “Always treat your employees exactly as you want them to treat your best customers. What’s your take on creating a great organizational culture?
Daniel Edds: Both are correct and both don’t go far enough. The employee experience is likened to the backbone of organizational culture. However, there are other parts.
- The value drivers and mindsets of individual leaders. A supportive culture will be noted by supportive leaders and managers.
- The alignment of leader behaviors and core values.
- The rules of the leadership system. Simple rules like, “leaders are not to be the primary go-to person for all team problems.”
- The routines of executive and management. Simple routines like rounding or a daily gemba walk speak more to a supportive culture as anything.
- The reward system. Are leaders and staff rewarded and recognized for creating a supportive culture? If they are not, discussions around culture are largely just that – discussions.
The overwhelming majority of more than 9,000 workers included in a recent Accenture survey on the future of work said they felt a hybrid work model would be optimal going forward, a major reason for that being the improved work-life balance that it offers. How do you promote work-life balance at your company?
Daniel Edds: A hybrid work model will work for some and not for others. Clearly, nurses, doctors, machinists, and manufacturing assembly people all need to be onsite. Conversely, programmers and software engineers can do their work from any place with an internet connection. My research did not include work-life balance but I did notice that where cultures were supportive, discussions of work-life balance was not very prevenant.
How would you describe your company’s overall culture? Give us examples.
Daniel Edds: This question does not specifically apply. I am a consultant, researcher, thought leader. In addition, I find that strong dynamic cultures fit a specific organization. While some parts are transferable, the culture needs to fit the organization. There is no one size fits all. However, there are some common principles. Love (as a verb). There are a lot of ways to describe this:
- Safety, both psychological and physical
- 2Servant leadership, where leaders primary role is to support the workers who are creating customer value.
- Respect.
- Leaders eat last, they put the welfare of their subordinates above their own.
- Having difficult conversations before they erupt.
It is believed that a company’s culture is rooted in a company’s values. What are your values and how do they affect daily life at the workplace?
Daniel Edds: Culture does have its roots in values. However, values without alignment with foundational behaviors. These behaviors come down the personal behaviors of leaders. A common core value is respect, yet employees often work in climates driven by fear. A nationally recognized hospital has a single core value of respect. Respect for the work, respect for the worker, and respect for the patient. One of the foundational behaviors is “listen to understand.” Every leader is trained and expected to model this foundational behavior.
An organization’s management has a deep impact on its culture. What is your management style and how well has it worked so far?
Daniel Edds: My research did not reveal much impact from “management style.” The value or role of management style diminishes as an organization grows. Case, the US Army, with 2,000,000 active and reserve duty personnel has little reliance on management style. They are very clear, “we practice servant leadership” (statements from a retired 4-Star general and a Full Colonel, US Army ranger. My research indicates that high-impact organizations are very clear about how to lead and manage. They have little reliance on style.
Every organization suffers from internal conflicts, whether functional or dysfunctional. Our readers would love to know, how do you solve an internal conflict?
Daniel Edds: Internal conflicts are part of the human dilemma. Here is the most effective solution I found in my research – a team charter. However, the process of developing the charter is as important as the charter itself. A good team charter is short, no more than one page, three or four bullet point is better yet. The team develops the charter and the stream reviews it annually. The charter summarizes the key values, behaviors, and rules of how the team will respond to each other. The value of this is that the manager then becomes the enforcer of what the team developed. If someone chooses to NOT behave according to the team charter, they are effectively taking themselves off the team.
According to Culture AMP, Only 40% of women feel satisfied with the decision-making process at their organization (versus 70% of men), which leads to job dissatisfaction and poor employee retention. What is your organization doing to facilitate an inclusive and supportive environment for women?
Daniel Edds: This has not been the subject of my research of consulting work.
What role do your company’s culture and values play in the recruitment process and how do you ensure that it is free from bias?
Daniel Edds: HIgh-impact organizations start with the design of their culture and then work backward to align their major work processes. They recognize that their culture is their ultimate competitive advantage. This includes the recruitment of talent. Practically, this means fit to culture is as important, if not more important than technical skills. Ensuring freedom from bias begins with core values and then is modeled by individual leaders, the rules, and routines that will support the values. Practically this means that there will be documented rules in place to support inclusive hiring practices. In addition, it means that the hiring and interview processes will have a level of transparency to support the recruitment of top talent that will also fit within the culture of the organization.
We’re grateful for all that you have shared so far! We would also love to know if there was one thing that you could improve about your company’s culture, what would it be?
Daniel Edds: Most companies say the number one thing they would like to improve upon is their innovation and strategic execution. Innovation comes out of a culture that will support collaboration. Collaboration is the material that will generate innovation. In the same way, the execution of strategy is supported by cultures of high employee engagement. If a firm embarked on a new strategy but two-thirds of the workforce either does not care or is actively sabotaging the workplace, (about the national average) then the strategy is doomed before it ever gets started.
This has been truly insightful and we thank you for your time. Our final question, however, might be a bit of a curveball. If you had a choice to either fly or be invisible, which would you choose and why?
Daniel Edds: Fly since I was a small boy. If I can fly, I can be free and sore with the winds. It also means I can be invisible if I want.
Jed Morley, VIP Contributor to ValiantCEO and the host of this interview would like to thank Daniel Edds for taking the time to do this interview and share his knowledge and experience with our readers.
If you would like to get in touch with Daniel Edds or his company, you can do it through his – Linkedin Page
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