This case study outlines ways in which it is possible to change the culture of an organisation so that it retains what it sees as its strengths while at the same time embracing new ways of doing things that are essential for driving the business forward.
It focuses on how Cummins has developed a shared vision and mission to re-energise the company and unleash the creativity of its employees. This approach recognises that a key part of the process is to encourage employees to 'act like owners working together'.
Like other large international companies, Cummins has developed ways of thinking based on a common culture and a sense of direction. Operating in highly competitive business-to-business (B2B) markets, the company needs to fully utilise the innovative ideas and energy of its employees to remain successful. This study looks at how the process of developing a shared vision better equips the company to be successful in a rapidly changing business environment.
Cummins Inc. is one of the world's leading manufacturers of high-performance, low-emission diesel engines and power generation systems. Component technology leaders such as Holset turbochargers, Newage alternators, Fleetguard filtration and Nelson exhaust products are also part of the company. In the UK, Cummins has been established for almost 50 years and now operates six highly productive manufacturing plants with a strong export focus.
'Culture' describes an organisation's typical approSach to doing things. Culture refers to an organisation's shared beliefs, its written and unwritten policies and procedures that determine the ways in which it goes about its business. You can gain a feel for an organisation's culture by looking around it and talking to its employees.
Some organisations come across as very dynamic, with employees who are encouraged to take risks and to put forward innovative new ideas. With some others, their present decisions appear heavily shaped by previous actions and the organisation's employees are rarely encouraged to break out from the established culture and take risks.
Successful management of change involves moving an organisation and its employees forward from one way of doing things to a more positive approach. Ideally, everyone within the organisation needs to understand and accept the need for change, and a widespread consultation process needs to be put in place to identify ways of moving the organisation and its culture forward.
In creating a process of change at Cummins, the intention was to build on aspects that were successful, while at the same time create a vision, mission and set of values that would move the organisation forward with a more dynamic culture.
The vision of the organisation sets out an inspirational view of what the organisation is seeking to achieve. The values of the organisation are the key beliefs, setting out the qualities that it values and the principles by which it is guided.
In preparing for change, Cummins arranged a series of focus workshops across the company. These were designed to be 'inclusive' they encouraged and took account of the ideas and views of a full range of people from across the company's different locations worldwide. Individuals and groups were encouraged to identify aspects of their existing ways of working that they valued and wished to retain. These were referred to as the organisation's 'sacred bundles'.
This part of the process was essential in enabling the organisation to build on the bedrock of existing values and practice, while at the same time recognising the need to move forward. Participants' preferred values often included aspects such as 'respect for each other and for the customer' and the need for 'a sense of community'.
At the same time as seeking to re-energise current values, Cummins realised the importance of creating a new, clear vision that would bring about consistency and cohesion across the global organisation. A set of common values, beliefs and goals was agreed and adopted.
The focus group process revealed a high degree of pride in the ability of the company, its products and its employees to improve the lives of people - helping customers to succeed, improving local communities and generating new solutions to reduce emissions and benefit the wider environment. When linked to the core business of providing power, the new vision proclaimed a strong statement with which employees could identify: 'Making people's lives better by unleashing the Power of Cummins.'
The vision is supported by a mission statement showing how it will be achieved: 'We unleash the Power of Cummins by':
- motivating people to act like owners working together
- exceeding customer expectations by always being first to market with the best products
- partnering with our customers to make sure they succeed
- demanding that everything we do leads to a cleaner, healthier, safer environment
- creating wealth for all stakeholders.
The message which comes through strongly from the vision and mission is a culture in which employees are empowered to generate new and exciting ideas that best meet customers' needs. This approach involves working in close partnership arrangements with customers and in ways that help improve the environment.
Cummins recognised the need to move forward because of changes taking place in the external business environment that require new ways of thinking.
A key change has been the way in which Cummins has moved to a globally based organisation. This trend is likely to continue. Cummins has been involved not only in increased geographical diversification, but also in product diversification, moving beyond its traditional diesel engine business into other technologies.
The new vision and mission is intended to develop a business culture which is adaptable, flexible and able to respond faster to a dynamic global market place.
The VISION programme was rolled out by a series of special events that were very different from traditional business presentations. Those attending received no hint in advance of the approach to be used; it came as a real surprise. The emphasis was on informality and enjoyment: high energy, use of music, fun activities, much audience participation and creative-thinking group sessions with feedback.
Unlike usual training and development activities, events did not generate notes to take away, because the principal purpose behind them was motivational and inspirational: to win the hearts and minds of participants. However, the fun aspect of the programme roll-out was coupled with a serious underlying theme: that of moving the company forward, so that it becomes more flexible, fast-acting, creative, efficient and ultimately more profitable.
One major purpose of the programme was to introduce people to a new way of working by letting them see that their ideas were valued, and by encouraging them to contribute rather than simply listen to keynote speakers. The events were very lively and showed how the company wanted to create a culture that encouraged the unleashing of new ideas, so that everyone could make a creative input into what is a dynamic business.
These events actively illustrated the new vision of 'Unleashing the Power of Cummins' through 'motivating people to act like owners working together'. They also generated an atmosphere of shifting the boundaries of thinking, with a view to creating a workforce that was more ready to respond positively to unexpected problems and challenges.
As part of communicating the changing culture at Cummins, four other elements (Purpose, Values, Performance, Personality) have been highlighted. These are set out below:
What we do
Purpose (What business are we in?)
- Unleashing the power to enrich people's lives. Everyday. Everywhere. Everyway.
Performance (What makes us unique from our competitors?)
- Understand and satisfy end-customers' needs best. Easiest to do business with.
- Best value:
- innovative technology
- outstanding customer support
- winning partnerships
- world renowned brands
- Relentless cost reduction.
- Broadest and most capable global network.
- Our people do whatever it takes.
Who we are
Values (What do we value?)
- Delivering superior results
- Corporate responsibility
- Global involvement
Personality (What is our personality?)
- Driven to win
A key focus of the new vision is to encourage a business culture which nurtures the innovative ideas generated by employees at all levels of the company. This important aspect of the vision recognises that the most valuable resource available to the company is the creative energy of its own people.
By encouraging an atmosphere of thinking 'outside-the-box' and initiating a faster path to market, Cummins can continue to exceed the expectations of its customers. Indeed, this approach builds on a firm foundation for innovation already established at Cummins, translated into products with a competitive advantage in the marketplace.
For Cummins in the UK, the new vision is cascading throughout the organisation with a phased introduction programme to all 5,000 employees. As the company puts the mission into practice at all levels, its influence is translated into actions and improvements:
- Equipped with a shared set of approaches across a diverse UK organisation (in terms of locations, products and operating methods) the new way of working enables synergies to be harnessed across all parts of the business. Best practices in one area of the business can now be quickly adopted by others.
- By encouraging employees to 'act as owners' individuals and teams have identified significant opportunities to reduce overhead costs. Performance cell structures are being developed to devolve responsibility and establish more effective team working.
- The company-wide employee performance management system now reflects the commitment to the vision and mission. Managers and teams are assessed not just on how well they meet plans and targets, but also how well they demonstrate the new values of the company in everything they do. An internal web-site magazine provides guidance and enables employees to see mission results in action.
- Closer relationships with customers have been established by developing a partnership approach. Cummins offers an 'open-door' approach by encouraging customers to visit its plants on a regular basis. Customer councils have also been established to provide feedback on product performance and requirements for the future. A rapid response customer support system has been established which enables users of Cummins powered equipment to register their product on-line via the company web-site.
By creating an attractive, energetic corporate culture, Cummins is encouraging new, younger and more diverse people to join the organisation and to contribute to its ongoing success.
Cummins has successfully re-energised its existing culture by:
- encouraging people to say what they value about the existing culture
- creating a more innovative company that is better placed to deal with a changing and competitive global business environment.
The key to success lies in encouraging everybody to become involved and to contribute their own ideas and thinking in a way that models an inclusive and innovative company.