December 4, 2025 • 23 mins
What really changes a workplace culture—and what’s just surface-level noise? In this powerful conversation, Chellie Phillips sits down with Stephen Childs, Chief HR Officer at Panasonic, to uncover the real strategies that transformed Panasonic from a single-location operation into a multi-billion-dollar, award-winning Best Place to Work.
Stephen takes us behind the scenes of their culture journey—from visiting top innovation companies to implementing behaviors-based leadership, enforcing a “no asshole policy,” and aligning every executive around a shared culture model. He shares why ping-pong tables and casual dress codes don’t move the needle, how accountability truly works, and why transparency during crises (including COVID shutdowns) earned Panasonic its best employee opinion scores in the toughest year on record.
We explore:
- Why culture must be treated as a business process—not an HR initiative
- How to get executive buy-in for real, lasting change
- What accountability looks like at every level
- How to align a growing organization around shared values and behaviors
- Why leaders must hear the truth—even when it’s uncomfortable
- How Panasonic cut turnover in half and built deep leadership trust
If you're leading a team, building a culture, or trying to create meaningful organizational change, this episode is packed with practical insights you can apply today.
Thanks for listening. Grab the book the podcast is based on at https://mybook.to/culturesecrets . Check out my website www.chelliephillips.com for more great content. Follow me on LinkedIn.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
SPEAKER_03 (00:43):
And a zero tolerance plan on toxic leadership.
You'll hear how aligningexecutives first, hiring to
behaviors, andover-communicating turned trust
scores around and cut turnover.
Here's Shelly with Steven.
SPEAKER_02 (00:56):
Tell me a little bit about your background and how
you got interested in aworkplace culture.
SPEAKER_00 (01:01):
I've been in uh HR space, I've been here for 24
years, and we've growndramatically.
We went from a very small$400million organization to over a$3
billion organization.
We went from one location to 12,13 locations and about 400
people to now, about 6,500people, 7,000 people on any
(01:24):
given day.
It just changed so much overthat time frame.
And when we originally startedthis conversation about culture,
it really wasn't about trueculture.
It was about change managementor transformation.
We were planning on goingthrough an ERP transformation.
And they said, Hey, Steven, youwant to be part of this figuring
(01:46):
out how we do this changemanagement.
And I said, Yeah, I'm all in.
So I started havingconversations with companies,
just like you're doing now onculture and everything else, and
said, How did you go throughyour transformation, your
digital transformation?
And they said, Before we getthrough that, talk a little bit
about your culture.
I go, it's dumping me here.
(02:07):
We're people before products.
Well, what makes you peoplebefore products?
Oh, you got me again.
We're heavy into innovation.
And we were at the time.
So I really explained some ofthe things we did to create an
innovation organization.
He goes, So you built that intoa culture model?
I go, we don't have a culturemodel.
So this was back in 2015.
(02:29):
So every time I went and had aconversation, somebody asked me
about our culture.
So I came back and had aconversation with the executive
team and said, Here's theproblem.
Nobody will share theirtransformation process with me
because it really depends onyour culture.
And they're asking about myculture, and we don't have so
then I started this journey ofgoing out and having
(02:51):
conversations with some of thebest place to work companies in
the US.
And I just call them up.
I'm gonna be in your area.
Can I come see you?
I wasn't, of course, but I wouldif they said yes.
And so all these companies juststarted saying yes.
So whether it was box.com or HBor WWT, whoever it was, they
(03:12):
just said, Yeah, come out, meetwith them, and went on a tour,
this culture tour.
And the original tour was thewrong thing because they
basically were trying to tell meor show me here's what we do.
We have these bingbag chairs,we're very flexible on our
workspace, we do happy hours.
(03:34):
This is what our happy hourlooks like.
They started really just tellingme about things.
Here's what we do to subsidizeour cafe, and so I took all of
this back and met with my team,and we did all those things.
Ping pong tables, we had pingpong tournaments, we did window
Wednesdays, we did we relaxedour dress code and went to
t-shirts, branded t-shirts only.
(03:55):
But that didn't change anything.
It didn't change glass doorscore or turnover.
It basically just made work alittle more fun, but it really
didn't change the guts of theproblem.
So we went back, my presidentand I had a number of different
conversations with some of thepeople we talked to before, and
they really said, so what arethe behaviors and values?
(04:15):
That at the end of the day,basically the behaviors and
values you put into yourorganization, it's what you do
and don't tolerate that makeyour culture.
So we went back and regrouped.
This was 2016.
We went offside as an executiveteam.
We talked about what we hadthese set of Panasonic
principles that had been on awall for many, many years that
(04:36):
nobody could contextualize.
And then we said, we're gonnacome up with some behaviors.
One of the things that we weretold, whatever you do, don't
come up with the behaviors as anexecutive team.
You got to do that as a company.
So we came up with our setfirst, then we had meetings with
all of our leaders and askedthem the question: what do you
think are the most importantbehaviors that we should focus
(04:59):
on as an organization?
And then we went out and did asurvey to every employee and got
their input.
And we took the consolidatedversion of what we heard, and we
came up with our sevenbehaviors.
So that's how we came up withthese seven principles that
Panasonic is really values thatPanasonic has put on the walls
(05:19):
for years, and then we matchedit with seven key behaviors, and
then we brought all of ourleaders together and said,
here's the deal.
We don't care what we told youwhen we hired you, whether it
was one week ago or five yearsago or 15 years ago, here's what
we're gonna do.
Moving forward, this is whatwe're gonna care about the most.
So we put our culture model upand we created a new leadership
(05:42):
model that reflects the newculture.
And we said, here's what we'regonna ask you to do moving
forward.
We're gonna ask you to have arelationship with your team.
We're gonna ask you to really beresponsible for the people in
your charge, not be in charge,right?
We've explained theaccountability model that we're
gonna hold them accountable tothis new model.
They have to think through, it'sall about the conversation, is
(06:04):
one of our taglines.
And we basically said, look,you're gonna, a lot of you are
really gonna suck at this atfirst.
And that's okay, right?
We're doing a bait and switch.
So all we're asking you is ifyou want to stay in this
leadership job, that you go intoit knowing this is what we want
you to get better at.
And we'll help you get better.
We'll train you.
We did.
We brought in a lot of trainingand support.
(06:26):
We had a lot of meetings, wejust overkilled it.
We brought in the NeuroLeadership Institute to kind of
help launch it for us.
And we basically said, nowyou're responsible for latching
onto.
If you're going to be successfulin this organization, you've got
to care about your employees,think about high potential
development, their successionplan, their role clarity,
organizational design anddevelopment, and talking to them
(06:49):
and getting to know them at apersonal level.
And we built that all into theirperformance management process.
And then we said, we'll give yougrace, right?
Again, we're all gonna have tofigure out how to do this
better.
About six months later, we said,now we'll still keep training
you on these new leadershipcompetencies, but if there's
(07:11):
anybody who's not meeting thesebehavior requirements, you're
not gonna be here.
You've had plenty of time to getaccustomed to what we're saying
from a behavior standpoint.
We care 51% how you do it and49% what you do.
So your job's important and yourtechnical expertise is
important, but we care 51% howyou do it.
And we said, if you're not gonnado it to these behaviors and
(07:33):
values, you're not gonna behere.
And so the next six months, weterminated about 26 people.
And we said, look, it got realeasy.
So we took the first one we didwas that we branded the
termination.
So we had to go to legal andsay, look, we're gonna have to
terminate this person for beinga butthole, basically, for not
following these behaviors andprinciples.
And we're gonna tell them we'refiring him because he's a
(07:55):
butthole.
And we did.
We actually used stronger wordsthan that because we basically
said we're gonna have a noasshole policy.
That's what we're gonna create.
We're not gonna tolerate it.
If we have if we cancorroborate, that's the way
you're leading, you're gonna beout here.
We basically terminated him, andwe went and told the company
that we terminated thisindividual as a very high-level
(08:17):
individual.
And we said, look, we terminatedthis person, we have sort of
zero tolerance related to ourbehavior.
And then we did that 26 moretimes over the next six months
at every level in theorganization, DP level down to
uh person who just started freshout.
And after we did that, man, thepeople got on board with this
(08:38):
thing.
They knew we were not justrolling out some flavor of the
day culture model that we reallymeant it.
Because we were some of our bestengineers, one of our VPs,
right?
And then everybody we broughtin, we really matched their
whole interview up to thisculture model.
And we spent more than 50% ofthe time on interviews with the
(08:59):
culture, the other part of thetime we spent on your technical
capabilities, and thatdramatically changed everything
for us, to be honest.
It changed our employee opinionsurvey where leadership trust
went from almost last to first.
We were very transparent andeverything moving forward.
We took all of our peopleprocesses, we turned them into
(09:21):
playbooks, so everybody knewexactly how we did, what we did,
why we did it.
And then we went on tour andwent to every facility and let
people just ask questions aboutour processes, why we're going
through this, the culture.
And from then on, we just keptsupporting it more and more with
(09:41):
all those people processes.
Whatever we did, we wouldbasically pull out the culture
model and say, how is how are wegoing to do this as a leadership
team and match up to thisculture model?
During COVID time frame, whenCOVID hit in March of 2020,
basically they shut down ourplants in Mexico.
So they almost shut down ouroperations uh for the part of
(10:05):
April and almost all of May.
May we had 5% of sales.
It was pretty dismal.
We said, look, we're gonna haveto do something.
They literally won't even let usbuild anything.
So we're probably gonna figureout for the next six months or
so, we're gonna have to look atsome furloughs and some pay cuts
along with a lot of othercompanies.
And we said, All right, how arewe gonna do?
So we pulled out our culturemodel and said, here's what
(10:26):
we're gonna do.
We're gonna over-communicatewith all employees about what
we're doing, why we're doing it,why we need to do this, what our
business looks like, what we'rethinking.
And then we're gonna, for paycuts, we're gonna take almost
all the pay cuts at the top andthen work down a few levels.
And then at some levels, we'renot gonna do any pay cuts.
The ones that it's gonna hurtthe most, we're not gonna do any
(10:46):
pay cuts.
Versus this 10% pay cut acrossthe board for everybody, it
hurts people differently, and werecognize that.
So we took them more at the top.
Then for furloughs, we were justhighly community with how we did
these furloughs.
So we went through that wholeprocess.
We cut people's pay, we did thefurloughs, and then October
came, and we were gonna puteverything back the way it was,
(11:08):
but at the same time, we had ourEOS survey that was due to come
up.
And we said, man, we're justgonna get hammered on this
employee opinion survey becauseit's been such a bad year.
We had to furlough people, notlay off anybody.
We had to do a cafe, but wesaid, look, some of the
companies were gonna just skipthe year and say it's an
anomaly.
We're not gonna do employeeopinion survey, even some
(11:30):
panasonic companies.
We said, we're gonna do it.
We wanted to hear it how westill want to hear how we did
during this time.
So we went through the EOSsurvey, and when we got it back,
it was the best EOS survey thatwe ever had in the worst
possible year that we've everhad as a company, which told us
very, very clearly it's notabout how well you're doing,
(11:51):
it's how well you're managingthat culture model with your
employees that matter becausethat was our best EOS survey.
But to us, I was telling we didsomething right.
The last four or five years thatwe worked on this thing wasn't
in vain.
It made a huge difference.
We already saw a difference inour turnover.
We're half of what our industryis in turnover.
We saw this EOS survey that saidthis is the best EOS survey we
(12:15):
had, and one of the better ones,Panasonic globally.
It was a really good validationfor a lot of the work that we've
been doing.
And still today we've doubledown on it.
No matter what comes up, we lookat that culture model.
We talk about it first at all ofour meetings.
So even if you're in a quarterlyoperation meeting, you're gonna
(12:35):
hear about the culture first.
We're gonna have our all handsmeeting here at one o'clock, and
the first slide is our culturemodel.
So we lead to it, we manage thebusiness to it, and it's it's
now at the core who we are as acompany.
And it's allowed us to become abest place to work company since
(12:56):
2016.
The last two years, we've on topof being 101 best place to work,
been the number one 100 bestplace to work two times out of
the last five years.
And then the last two years,we've become uh great place to
work, certainly.
SPEAKER_02 (13:10):
I think the trust and transparency is huge because
people needed to know and beable to believe what they were
hearing.
And it's not surprising that ifyou're doing all that right on
the back end that it's going toshow up on the survey.
I think that's really the keywhen you put your people first
in what you're doing, theneverything else seems to fall in
place.
Yeah.
One of the things that washaving some of these
conversations was that there'snot a line on the budget for
(13:31):
culture.
Like so when people are makingplans, how do I put this into
the work plan and all this otherkind of sense?
So when you were taking it backto the executive leadership
team, or however you go throughthe process to be able to budget
for initiatives and do thesekind of things, what are some of
the things that you took back topoint out and say, okay, well,
culture itself is not verytangible.
Here's some tangible resultsthat we can get from that you
(13:54):
can actually try to put towardsa budget item that makes us
something that we shouldactually invest in.
SPEAKER_00 (13:58):
Yeah, the interesting thing was is I came
back with a list of things tobudget on cafe, subsidizing
cafe, and window Wednesdays andchanging the environment, all
the things that we spent a goodbit of money on that didn't
work.
The funny thing is, most of thethings that really have a
dramatic impact don't cost thatmuch.
We increased our communicationteam.
(14:20):
So that was one of the bestthings that we could have done
was increase our communicationteam.
So we had a communication planfor all of our big, all the big
things that we were going toroll out.
If you don't have a goodorganizational change
communication plan, then tellpeople what you're doing, why
you're doing it, how you'redoing it.
We stuck around those three.
That was a little bit costly.
The other thing that we stuckwith is the development.
(14:43):
We said, look, we're not takingaway our development money.
And even during our worst times,we didn't mess with our training
budget.
We said, now we're gonna takethe time to upskill you.
You tell us what's important toyou.
We helped you train.
We're gonna disproportionatelytrain some of our accelerated
leaders, and we're gonna leavethis budget open for you to come
back with your leader to say,what do you need to close the
(15:03):
gap on?
And to this date, we haven'tspent our training budget fully,
and we're not taking it away.
We're leaving that space openfor people to go, this is what I
need, and this is how I need toreally close this gap.
And that's been very hardbecause it's been a tough two
years for people to get thisconcept of allocating my time,
(15:23):
working with my boss to allocatethe right amount of time for
this training.
So we still have people who go,hey, hey, I still not getting
all the training.
Well, it's there.
You just got to work with yourboss to figure out, and you've
got to disproportionately carveout the time to get it done.
And people who do that timeblock and everything else,
figure out a way to build thetraining, but not everybody's
(15:44):
good at that.
So that's kind of ongoing forus, is really teaching people
how to put that on the forefrontof their daily activities
instead of waiting until sometime free up to get training,
because that never happens.
SPEAKER_02 (15:58):
Yeah, there is no free time.
And I think that's important.
The book is based around valueculture, and V is vision, A is
accountability, L is leadership,U is the uniqueness of the
people, and E is engagement.
And I think one of the thingsthat I've seen when I've been
talking to everybody is theaccountability piece is huge,
that it cannot be just on theleadership team to be
(16:19):
accountable for the success ofthis, that you have to be able
to pull that accountability downto awareness on an individual
basis.
That each one is accountable forthe success.
So, how do you get that messageout there that this is just not
something that is a leadershipinitiative?
This is something that we wantyou to take hold of in
individual cubicles andindividual workspaces as
(16:39):
individuals to be able to makethe impact that you want to see.
SPEAKER_00 (16:42):
Yeah, so part of our messaging around this and in our
playbooks, do we have a messagefor leaders and we have a
message for everybody else?
And both basically haveaccountability built in.
Performance management is thesame way.
The leaders have uh training anddevelopment is the same way.
Leaders have a space in therethat they're accountable for,
(17:03):
but the employee, we say theemployee, the number one
advocate for your training anddevelopment is you, not your
boss and not HR, and not theexecutive team, it's you.
We'll create a space for you toget it done.
You've got to make sure you getit done.
Same thing on our culture model.
Accountability is one of thebehaviors, and we focus on that.
(17:23):
So we'll focus on theseaccountabilities.
I don't know if you ever heardof Jocko Willett.
So, Jocko Willett, we actuallyplayed a video and we had let
everybody have a copy of hisbook who wanted a copy of his
book, it's on accountability,extreme ownership.
And that was a little harsh forsome because it's pretty
intense.
But the whole point is it can'tbe the executives, it can't be
(17:46):
HR.
It has to be everybody holdingeach other accountable for what
we say this culture model is.
And most of what's going toimprove it is not the leadership
team.
It's employees basically saying,this is broke, this needs to be
fixed, this is what I see, thisis what it feels like.
Same thing with DEI.
If you don't have employeestelling you what's broke,
(18:09):
telling you how it feels, thenit's really hard for the
leadership team to prioritizeand make those changes.
So that's the way we do it andthe way we talk about it.
And we have what we call realtalks, where we bring our
employees together, they can geton the call with the executives,
freeform, tell us what you'rethinking, tell us what's broke,
tell us what's working, so wecan continuously prioritize our
(18:31):
level of repair to the gaps.
SPEAKER_02 (18:34):
So I know you're getting close to having to go.
One last thing that I'll askbefore that is what's the best
piece of advice that you wouldgive a team that was looking to
make a change?
SPEAKER_00 (18:44):
Yeah, the hardest piece is getting the executives
to agree.
The number one change thing, ifyou spend any time on change,
it's just getting the executiveteam to agree that they're gonna
do this together, that they'reall in.
They don't all have to agree onevery part of the culture model.
They have to agree that this atthe end of the day is gonna be
the culture model, and they haveto own it, right, as an
(19:06):
executive team.
It can't be launched from HR.
You gotta all your processes,and they need to become business
process.
Culture is a business process.
If they see it's important tothe president, and if they see
it's important to all theexecutives, and they talk about
it in their meetings first,everybody will be in.
So, number one is just gettingthat executive leadership team,
(19:29):
not a communication team, to godo it, not to go brand it.
The executive team becomes thebranding mechanism for which
this culture model has to beinfused into your business.
And then you get all youremployees involved.
But most people try to run theirculture, and I get called by
companies all the time to go,it's not working for us.
Because they ask HR or theircommunication team to go launch
(19:51):
this thing, they ask HR to talkabout the training, they have HR
talking about performancemanagement, when every bit of
that should be talked about,those functional leaders in the
business.
And when you do that, thepriorities just change for the
employees.
The huge buying-in, those allthose things become business
processes.
SPEAKER_02 (20:10):
Yeah, I think there's a lot of truth to that.
Everybody assumes that if thecommunications is launching it,
this is just another something,and then there'll be something
else that replaces it six monthsdown the road.
It's just another initiative.
What you're wanting to do isreally kind of something that's
going to be long-term, reallydeep soon.
I think the interesting thingyou said there about the
leadership team getting theminvolved.
I think one of the things that'scome up through some of the
conversations that I've beenhaving is that leaders get
(20:32):
clouded.
Their vision gets cloudedbecause of the people that
surround them.
A lot of times, peoplesurrounding a leadership team
don't want to say there'ssomething that's not right or
there's something that's notgreat.
So if the conversation happens,it's like, oh, everything's
great.
How can a leader make sure thatthey're keeping their vision in
focus instead of letting it beclouded by maybe what they're
hearing from the people aroundthem?
SPEAKER_00 (20:53):
Yeah, the key to that is having that strong core
model, because we did the samething, right?
I would go off on my tangentbased off my team and who I was
exposed to.
We didn't have that compass,right?
So the model itself, thesebehaviors and values, and not
only that, is we prioritize themost important things that we
(21:13):
work on as a company.
So every year we launch it againwith these are the three most
important things, and this ishow we're gonna do it, right?
So this is the behaviors andvalues that we're gonna do these
three things with.
So we're all pulling on the samerope with the same cultural
narrative for every group.
(21:34):
So you can't get lost.
So they can send me on my wayand talk with my team, but on
the way with the same messagethey're telling everybody else.
Here's the three things, all mygoals and objectives are tied to
these three things, all of mypeople's goals and objectives
are tied to these three things,and everybody's tied to those
behaviors and values on theirperformance.
(21:55):
So it's really hard to getsteered away from that culture
bomb.
And when somebody does, becausemaybe they're not fully bought
in, then it becomes reallyapparent and it gets escalated
back up through the chain ofcommand really, really quick.
So we can go either get on boardor we'll help you find a place,
(22:16):
hopefully, one of ourcompetitors that you can go ruin
their culture, and we'll be gladto help you transition out.
It's really hard to get offtrack if everybody has the same
company.
SPEAKER_04 (22:26):
You can learn more from the culture.
And a zero tolerance plan on toxic leadership.
You'll hear how aligningexecutives first, hiring to
behaviors, andover-communicating turned trust
scores around and cut turnover.
Here's Shelly with Steven.
SPEAKER_02 (00:56):
Tell me a little bit about your background and how
you got interested in aworkplace culture.
SPEAKER_00 (01:01):
I've been in uh HR space, I've been here for 24
years, and we've growndramatically.
We went from a very small$400million organization to over a$3
billion organization.
We went from one location to 12,13 locations and about 400
people to now, about 6,500people, 7,000 people on any
(01:24):
given day.
It just changed so much overthat time frame.
And when we originally startedthis conversation about culture,
it really wasn't about trueculture.
It was about change managementor transformation.
We were planning on goingthrough an ERP transformation.
And they said, Hey, Steven, youwant to be part of this figuring
(01:46):
out how we do this changemanagement.
And I said, Yeah, I'm all in.
So I started havingconversations with companies,
just like you're doing now onculture and everything else, and
said, How did you go throughyour transformation, your
digital transformation?
And they said, Before we getthrough that, talk a little bit
about your culture.
I go, it's dumping me here.
(02:07):
We're people before products.
Well, what makes you peoplebefore products?
Oh, you got me again.
We're heavy into innovation.
And we were at the time.
So I really explained some ofthe things we did to create an
innovation organization.
He goes, So you built that intoa culture model?
I go, we don't have a culturemodel.
So this was back in 2015.
(02:29):
So every time I went and had aconversation, somebody asked me
about our culture.
So I came back and had aconversation with the executive
team and said, Here's theproblem.
Nobody will share theirtransformation process with me
because it really depends onyour culture.
And they're asking about myculture, and we don't have so
then I started this journey ofgoing out and having
(02:51):
conversations with some of thebest place to work companies in
the US.
And I just call them up.
I'm gonna be in your area.
Can I come see you?
I wasn't, of course, but I wouldif they said yes.
And so all these companies juststarted saying yes.
So whether it was box.com or HBor WWT, whoever it was, they
(03:12):
just said, Yeah, come out, meetwith them, and went on a tour,
this culture tour.
And the original tour was thewrong thing because they
basically were trying to tell meor show me here's what we do.
We have these bingbag chairs,we're very flexible on our
workspace, we do happy hours.
(03:34):
This is what our happy hourlooks like.
They started really just tellingme about things.
Here's what we do to subsidizeour cafe, and so I took all of
this back and met with my team,and we did all those things.
Ping pong tables, we had pingpong tournaments, we did window
Wednesdays, we did we relaxedour dress code and went to
t-shirts, branded t-shirts only.
(03:55):
But that didn't change anything.
It didn't change glass doorscore or turnover.
It basically just made work alittle more fun, but it really
didn't change the guts of theproblem.
So we went back, my presidentand I had a number of different
conversations with some of thepeople we talked to before, and
they really said, so what arethe behaviors and values?
(04:15):
That at the end of the day,basically the behaviors and
values you put into yourorganization, it's what you do
and don't tolerate that makeyour culture.
So we went back and regrouped.
This was 2016.
We went offside as an executiveteam.
We talked about what we hadthese set of Panasonic
principles that had been on awall for many, many years that
(04:36):
nobody could contextualize.
And then we said, we're gonnacome up with some behaviors.
One of the things that we weretold, whatever you do, don't
come up with the behaviors as anexecutive team.
You got to do that as a company.
So we came up with our setfirst, then we had meetings with
all of our leaders and askedthem the question: what do you
think are the most importantbehaviors that we should focus
(04:59):
on as an organization?
And then we went out and did asurvey to every employee and got
their input.
And we took the consolidatedversion of what we heard, and we
came up with our sevenbehaviors.
So that's how we came up withthese seven principles that
Panasonic is really values thatPanasonic has put on the walls
(05:19):
for years, and then we matchedit with seven key behaviors, and
then we brought all of ourleaders together and said,
here's the deal.
We don't care what we told youwhen we hired you, whether it
was one week ago or five yearsago or 15 years ago, here's what
we're gonna do.
Moving forward, this is whatwe're gonna care about the most.
So we put our culture model upand we created a new leadership
(05:42):
model that reflects the newculture.
And we said, here's what we'regonna ask you to do moving
forward.
We're gonna ask you to have arelationship with your team.
We're gonna ask you to really beresponsible for the people in
your charge, not be in charge,right?
We've explained theaccountability model that we're
gonna hold them accountable tothis new model.
They have to think through, it'sall about the conversation, is
(06:04):
one of our taglines.
And we basically said, look,you're gonna, a lot of you are
really gonna suck at this atfirst.
And that's okay, right?
We're doing a bait and switch.
So all we're asking you is ifyou want to stay in this
leadership job, that you go intoit knowing this is what we want
you to get better at.
And we'll help you get better.
We'll train you.
We did.
We brought in a lot of trainingand support.
(06:26):
We had a lot of meetings, wejust overkilled it.
We brought in the NeuroLeadership Institute to kind of
help launch it for us.
And we basically said, nowyou're responsible for latching
onto.
If you're going to be successfulin this organization, you've got
to care about your employees,think about high potential
development, their successionplan, their role clarity,
organizational design anddevelopment, and talking to them
(06:49):
and getting to know them at apersonal level.
And we built that all into theirperformance management process.
And then we said, we'll give yougrace, right?
Again, we're all gonna have tofigure out how to do this
better.
About six months later, we said,now we'll still keep training
you on these new leadershipcompetencies, but if there's
(07:11):
anybody who's not meeting thesebehavior requirements, you're
not gonna be here.
You've had plenty of time to getaccustomed to what we're saying
from a behavior standpoint.
We care 51% how you do it and49% what you do.
So your job's important and yourtechnical expertise is
important, but we care 51% howyou do it.
And we said, if you're not gonnado it to these behaviors and
(07:33):
values, you're not gonna behere.
And so the next six months, weterminated about 26 people.
And we said, look, it got realeasy.
So we took the first one we didwas that we branded the
termination.
So we had to go to legal andsay, look, we're gonna have to
terminate this person for beinga butthole, basically, for not
following these behaviors andprinciples.
And we're gonna tell them we'refiring him because he's a
(07:55):
butthole.
And we did.
We actually used stronger wordsthan that because we basically
said we're gonna have a noasshole policy.
That's what we're gonna create.
We're not gonna tolerate it.
If we have if we cancorroborate, that's the way
you're leading, you're gonna beout here.
We basically terminated him, andwe went and told the company
that we terminated thisindividual as a very high-level
(08:17):
individual.
And we said, look, we terminatedthis person, we have sort of
zero tolerance related to ourbehavior.
And then we did that 26 moretimes over the next six months
at every level in theorganization, DP level down to
uh person who just started freshout.
And after we did that, man, thepeople got on board with this
(08:38):
thing.
They knew we were not justrolling out some flavor of the
day culture model that we reallymeant it.
Because we were some of our bestengineers, one of our VPs,
right?
And then everybody we broughtin, we really matched their
whole interview up to thisculture model.
And we spent more than 50% ofthe time on interviews with the
(08:59):
culture, the other part of thetime we spent on your technical
capabilities, and thatdramatically changed everything
for us, to be honest.
It changed our employee opinionsurvey where leadership trust
went from almost last to first.
We were very transparent andeverything moving forward.
We took all of our peopleprocesses, we turned them into
(09:21):
playbooks, so everybody knewexactly how we did, what we did,
why we did it.
And then we went on tour andwent to every facility and let
people just ask questions aboutour processes, why we're going
through this, the culture.
And from then on, we just keptsupporting it more and more with
(09:41):
all those people processes.
Whatever we did, we wouldbasically pull out the culture
model and say, how is how are wegoing to do this as a leadership
team and match up to thisculture model?
During COVID time frame, whenCOVID hit in March of 2020,
basically they shut down ourplants in Mexico.
So they almost shut down ouroperations uh for the part of
(10:05):
April and almost all of May.
May we had 5% of sales.
It was pretty dismal.
We said, look, we're gonna haveto do something.
They literally won't even let usbuild anything.
So we're probably gonna figureout for the next six months or
so, we're gonna have to look atsome furloughs and some pay cuts
along with a lot of othercompanies.
And we said, All right, how arewe gonna do?
So we pulled out our culturemodel and said, here's what
(10:26):
we're gonna do.
We're gonna over-communicatewith all employees about what
we're doing, why we're doing it,why we need to do this, what our
business looks like, what we'rethinking.
And then we're gonna, for paycuts, we're gonna take almost
all the pay cuts at the top andthen work down a few levels.
And then at some levels, we'renot gonna do any pay cuts.
The ones that it's gonna hurtthe most, we're not gonna do any
(10:46):
pay cuts.
Versus this 10% pay cut acrossthe board for everybody, it
hurts people differently, and werecognize that.
So we took them more at the top.
Then for furloughs, we were justhighly community with how we did
these furloughs.
So we went through that wholeprocess.
We cut people's pay, we did thefurloughs, and then October
came, and we were gonna puteverything back the way it was,
(11:08):
but at the same time, we had ourEOS survey that was due to come
up.
And we said, man, we're justgonna get hammered on this
employee opinion survey becauseit's been such a bad year.
We had to furlough people, notlay off anybody.
We had to do a cafe, but wesaid, look, some of the
companies were gonna just skipthe year and say it's an
anomaly.
We're not gonna do employeeopinion survey, even some
(11:30):
panasonic companies.
We said, we're gonna do it.
We wanted to hear it how westill want to hear how we did
during this time.
So we went through the EOSsurvey, and when we got it back,
it was the best EOS survey thatwe ever had in the worst
possible year that we've everhad as a company, which told us
very, very clearly it's notabout how well you're doing,
(11:51):
it's how well you're managingthat culture model with your
employees that matter becausethat was our best EOS survey.
But to us, I was telling we didsomething right.
The last four or five years thatwe worked on this thing wasn't
in vain.
It made a huge difference.
We already saw a difference inour turnover.
We're half of what our industryis in turnover.
We saw this EOS survey that saidthis is the best EOS survey we
(12:15):
had, and one of the better ones,Panasonic globally.
It was a really good validationfor a lot of the work that we've
been doing.
And still today we've doubledown on it.
No matter what comes up, we lookat that culture model.
We talk about it first at all ofour meetings.
So even if you're in a quarterlyoperation meeting, you're gonna
(12:35):
hear about the culture first.
We're gonna have our all handsmeeting here at one o'clock, and
the first slide is our culturemodel.
So we lead to it, we manage thebusiness to it, and it's it's
now at the core who we are as acompany.
And it's allowed us to become abest place to work company since
(12:56):
2016.
The last two years, we've on topof being 101 best place to work,
been the number one 100 bestplace to work two times out of
the last five years.
And then the last two years,we've become uh great place to
work, certainly.
SPEAKER_02 (13:10):
I think the trust and transparency is huge because
people needed to know and beable to believe what they were
hearing.
And it's not surprising that ifyou're doing all that right on
the back end that it's going toshow up on the survey.
I think that's really the keywhen you put your people first
in what you're doing, theneverything else seems to fall in
place.
Yeah.
One of the things that washaving some of these
conversations was that there'snot a line on the budget for
(13:31):
culture.
Like so when people are makingplans, how do I put this into
the work plan and all this otherkind of sense?
So when you were taking it backto the executive leadership
team, or however you go throughthe process to be able to budget
for initiatives and do thesekind of things, what are some of
the things that you took back topoint out and say, okay, well,
culture itself is not verytangible.
Here's some tangible resultsthat we can get from that you
(13:54):
can actually try to put towardsa budget item that makes us
something that we shouldactually invest in.
SPEAKER_00 (13:58):
Yeah, the interesting thing was is I came
back with a list of things tobudget on cafe, subsidizing
cafe, and window Wednesdays andchanging the environment, all
the things that we spent a goodbit of money on that didn't
work.
The funny thing is, most of thethings that really have a
dramatic impact don't cost thatmuch.
We increased our communicationteam.
(14:20):
So that was one of the bestthings that we could have done
was increase our communicationteam.
So we had a communication planfor all of our big, all the big
things that we were going toroll out.
If you don't have a goodorganizational change
communication plan, then tellpeople what you're doing, why
you're doing it, how you'redoing it.
We stuck around those three.
That was a little bit costly.
The other thing that we stuckwith is the development.
(14:43):
We said, look, we're not takingaway our development money.
And even during our worst times,we didn't mess with our training
budget.
We said, now we're gonna takethe time to upskill you.
You tell us what's important toyou.
We helped you train.
We're gonna disproportionatelytrain some of our accelerated
leaders, and we're gonna leavethis budget open for you to come
back with your leader to say,what do you need to close the
(15:03):
gap on?
And to this date, we haven'tspent our training budget fully,
and we're not taking it away.
We're leaving that space openfor people to go, this is what I
need, and this is how I need toreally close this gap.
And that's been very hardbecause it's been a tough two
years for people to get thisconcept of allocating my time,
(15:23):
working with my boss to allocatethe right amount of time for
this training.
So we still have people who go,hey, hey, I still not getting
all the training.
Well, it's there.
You just got to work with yourboss to figure out, and you've
got to disproportionately carveout the time to get it done.
And people who do that timeblock and everything else,
figure out a way to build thetraining, but not everybody's
(15:44):
good at that.
So that's kind of ongoing forus, is really teaching people
how to put that on the forefrontof their daily activities
instead of waiting until sometime free up to get training,
because that never happens.
SPEAKER_02 (15:58):
Yeah, there is no free time.
And I think that's important.
The book is based around valueculture, and V is vision, A is
accountability, L is leadership,U is the uniqueness of the
people, and E is engagement.
And I think one of the thingsthat I've seen when I've been
talking to everybody is theaccountability piece is huge,
that it cannot be just on theleadership team to be
(16:19):
accountable for the success ofthis, that you have to be able
to pull that accountability downto awareness on an individual
basis.
That each one is accountable forthe success.
So, how do you get that messageout there that this is just not
something that is a leadershipinitiative?
This is something that we wantyou to take hold of in
individual cubicles andindividual workspaces as
(16:39):
individuals to be able to makethe impact that you want to see.
SPEAKER_00 (16:42):
Yeah, so part of our messaging around this and in our
playbooks, do we have a messagefor leaders and we have a
message for everybody else?
And both basically haveaccountability built in.
Performance management is thesame way.
The leaders have uh training anddevelopment is the same way.
Leaders have a space in therethat they're accountable for,
(17:03):
but the employee, we say theemployee, the number one
advocate for your training anddevelopment is you, not your
boss and not HR, and not theexecutive team, it's you.
We'll create a space for you toget it done.
You've got to make sure you getit done.
Same thing on our culture model.
Accountability is one of thebehaviors, and we focus on that.
(17:23):
So we'll focus on theseaccountabilities.
I don't know if you ever heardof Jocko Willett.
So, Jocko Willett, we actuallyplayed a video and we had let
everybody have a copy of hisbook who wanted a copy of his
book, it's on accountability,extreme ownership.
And that was a little harsh forsome because it's pretty
intense.
But the whole point is it can'tbe the executives, it can't be
(17:46):
HR.
It has to be everybody holdingeach other accountable for what
we say this culture model is.
And most of what's going toimprove it is not the leadership
team.
It's employees basically saying,this is broke, this needs to be
fixed, this is what I see, thisis what it feels like.
Same thing with DEI.
If you don't have employeestelling you what's broke,
(18:09):
telling you how it feels, thenit's really hard for the
leadership team to prioritizeand make those changes.
So that's the way we do it andthe way we talk about it.
And we have what we call realtalks, where we bring our
employees together, they can geton the call with the executives,
freeform, tell us what you'rethinking, tell us what's broke,
tell us what's working, so wecan continuously prioritize our
(18:31):
level of repair to the gaps.
SPEAKER_02 (18:34):
So I know you're getting close to having to go.
One last thing that I'll askbefore that is what's the best
piece of advice that you wouldgive a team that was looking to
make a change?
SPEAKER_00 (18:44):
Yeah, the hardest piece is getting the executives
to agree.
The number one change thing, ifyou spend any time on change,
it's just getting the executiveteam to agree that they're gonna
do this together, that they'reall in.
They don't all have to agree onevery part of the culture model.
They have to agree that this atthe end of the day is gonna be
the culture model, and they haveto own it, right, as an
(19:06):
executive team.
It can't be launched from HR.
You gotta all your processes,and they need to become business
process.
Culture is a business process.
If they see it's important tothe president, and if they see
it's important to all theexecutives, and they talk about
it in their meetings first,everybody will be in.
So, number one is just gettingthat executive leadership team,
(19:29):
not a communication team, to godo it, not to go brand it.
The executive team becomes thebranding mechanism for which
this culture model has to beinfused into your business.
And then you get all youremployees involved.
But most people try to run theirculture, and I get called by
companies all the time to go,it's not working for us.
Because they ask HR or theircommunication team to go launch
(19:51):
this thing, they ask HR to talkabout the training, they have HR
talking about performancemanagement, when every bit of
that should be talked about,those functional leaders in the
business.
And when you do that, thepriorities just change for the
employees.
The huge buying-in, those allthose things become business
processes.
SPEAKER_02 (20:10):
Yeah, I think there's a lot of truth to that.
Everybody assumes that if thecommunications is launching it,
this is just another something,and then there'll be something
else that replaces it six monthsdown the road.
It's just another initiative.
What you're wanting to do isreally kind of something that's
going to be long-term, reallydeep soon.
I think the interesting thingyou said there about the
leadership team getting theminvolved.
I think one of the things that'scome up through some of the
conversations that I've beenhaving is that leaders get
(20:32):
clouded.
Their vision gets cloudedbecause of the people that
surround them.
A lot of times, peoplesurrounding a leadership team
don't want to say there'ssomething that's not right or
there's something that's notgreat.
So if the conversation happens,it's like, oh, everything's
great.
How can a leader make sure thatthey're keeping their vision in
focus instead of letting it beclouded by maybe what they're
hearing from the people aroundthem?
SPEAKER_00 (20:53):
Yeah, the key to that is having that strong core
model, because we did the samething, right?
I would go off on my tangentbased off my team and who I was
exposed to.
We didn't have that compass,right?
So the model itself, thesebehaviors and values, and not
only that, is we prioritize themost important things that we
(21:13):
work on as a company.
So every year we launch it againwith these are the three most
important things, and this ishow we're gonna do it, right?
So this is the behaviors andvalues that we're gonna do these
three things with.
So we're all pulling on the samerope with the same cultural
narrative for every group.
(21:34):
So you can't get lost.
So they can send me on my wayand talk with my team, but on
the way with the same messagethey're telling everybody else.
Here's the three things, all mygoals and objectives are tied to
these three things, all of mypeople's goals and objectives
are tied to these three things,and everybody's tied to those
behaviors and values on theirperformance.
(21:55):
So it's really hard to getsteered away from that culture
bomb.
And when somebody does, becausemaybe they're not fully bought
in, then it becomes reallyapparent and it gets escalated
back up through the chain ofcommand really, really quick.
So we can go either get on boardor we'll help you find a place,
(22:16):
hopefully, one of ourcompetitors that you can go ruin
their culture, and we'll be gladto help you transition out.
It's really hard to get offtrack if everybody has the same
company.
SPEAKER_04 (22:26):
You can learn more from the culture.
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