turning results into action: action planning at henkel

casestudyVolume 2, Issue 3, 2007

All content © copyright 2005-2008 Denison Consulting, LLC. All rights reserved. l www.denisonculture.com l

Turning Results into Action: Action Planning at Henkel

What makes a company successful? How can attitude, conduct and actions be molded into a coherent, performance-enhancing corporate culture that delivers success to shareholders, stakeholders and customers? These are important questions for any company but for Henkel, the answers to these questions are particularly important because of the large role that corporate culture plays within Henkel’s operations. Founded in 1876, “Henkel - A Brand like a Friend” is a Fortune Global 500 company headquartered in Dusseldorf, Germany. With more than 52,000 employees worldwide, it is a leader in three strategic business areas that are dedicated to making people’s lives easier, better and more beautiful: 1) Home Care, 2) Personal Care, and 3) Adhesives, Sealants, and Surface Treatment. In over 125 countries, people trust Henkel’s brands and technologies. From Dial® soap to Purex® laundry detergent and Duck® brand duct tape, Henkel brands are part of everyday life. Although the Henkel of 2007 is a far cry from its origins as a family-owned business, it continues to be significantly influenced by family roots. The significance of the culture that has developed over the decades is clearly expressed in the firmly established corporate principle: “We preserve the tradition of an open family.”

An integral part of Henkel’s success has been the value they have placed on the attitudes and opinions of their employees. Employee surveys have been a regular feature within the Henkel corporate environment since the 1980s; previous projects assessed employees’ attitudes, satisfaction, and identification with the company. These initiatives provided useful information for Henkel, but over time, problems arose within their employee survey efforts. The survey efforts addressed so many different issues that employees developed high expectations for extensive and tangible change. The changes that were introduced

were regarded as insignificant and later survey results revealed an impression that not much had happened, and employees becamediscouraged from participating in future surveys. In addition, it became increasingly apparent that surveying employee satisfaction, while having inherent value, did not facilitate an understanding of the factors that drive the success of a corporation or its cultural character. Henkel needed to know more than merely the level of satisfaction of its employees. Henkel needed to answer two questions: What drives success? What cultural elements need to be improved in order to improve performance?

The search for a suitable system to measure the cultural drivers of success within a corporation led Henkel to the Denison Organizational Culture Survey (DOCS). Henkel was looking for a culture tool that used benchmarks as an integral part of its employee surveys and could be executed with relative ease and within short intervals. Additionally, Henkel realized that the company as a whole would need to adopt a proactive approach to address the problems identified in the survey and that it would be necessary to create concrete action plans.

In 2003, all management levels in Henkel completed the DOCS -- a population around 7,500 worldwide. There were several clear messages from the results. First, they showed a perceived lack of knowledge of the Henkel strategy. In addition, Henkel managers were not sufficiently aware of the Vision and Values of the Henkel Group. The results also indicated that Henkel employees wanted closer cooperation across departmental boundaries.

Managers received the results for their departments to share with their employees. This allowed them


Table 1: Means and standard Deviations by Year

Index 2002 Mean (sd)

2003 Mean (sd)

2004 Mean (sd)

Strategic Direction & Intent

3.23 (.82) 3.44 (.78) 3.72 (.74)

Goals & Objectives 3.29 (.76) 3.43 (.72) 3.67 (.66)

Vision 2.98 (.72) 3.13 (.69) 3.34 (.67)

Coordination & Integration

2.98 (.75) 3.04 (.74) 3.15 (.75)

Agreement 3.22 (.67) 3.25 (.64) 3.34 (.64)

Core Values 3.41 (.69) 3.51 (.69) 3.72 (.66)

Capability Development

3.29 (.73) 3.30 (.70) 3.42 (.68)

Team Orientation 3.38 (.83) 3.44 (.81) 3.58 (.78)

Empowerment 3.30 (.76) 3.31 (.75) 3.46 (.73)

Creating Change 3.17 (.68) 3.17 (.67) 3.25 (.67)

Customer Focus 3.38 (.65) 3.38 (.65) 3.52 (.66)

N= 3716 in 2002; N=3592 in 2003; N=4067 in 2004

to identify potential areas for further improvement and to develop action plans. Henkel recommended feedback and discussion beginning with the following questions:

- What are the predominant patterns in the survey results?- How do these results fit with your own perception of the organization?- What conclusions might be drawn from the data with respect to our strategic objectives?- What are the specific deficiencies that need to be addressed so that we may achieve our goals and targets?

Feedback workshops were organized in order to discuss the survey results and action plans were created to address the changes and improvements suggested by the survey. Specifically, the groups discussed reasons for the low scores in the various areas, drew their conclusions and, where appropriate, recommended action steps to address these issues. Approximately 470 action steps were created to address the problem areas identified by the DOCS. Of these 470 action steps, 47% were involved with Henkel’s Strategy, Vision and Values, 25% were involved with Cross-divisional and Cross-functional Cooperation, 19% were involved

with Customer Focus, and 9% were involved with Teamwork and Cooperation.

The second survey, conducted in November 2004, showed many improvements. Results for Henkel overall showed improvements in all areas except Team Orientation (see Figure 1). The significant improvements in Mission reflected the intensive discussions held after the first survey and the intense communication of the Henkel Vision in the business sectors. Significant improvements also occurred in Coordination & Integration and Creating Change.

The benefit of action planning was also illustrated by improvements in different parts of the organiza-tion. For example, Business Unit 1 was low in two Mission indexes (i.e., Strategic Direction & Intent, Vision) and Consistency indexes (i.e., Coordination & Integration, Core Values). Specific action plans were developed and recorded for several different coun-tries and departments within this unit. Within each of these countries and departments, action plans for Business Unit 1 targeted anywhere from one to five areas for improvement including Core Values, Coor-dination and Integration, Vision and Mission. Most of these action plans further specified around three courses of action that would be taken to improve Henkel Overall

NANANA

NA

NA

NANANA

NA

NA

NA

NA

External Focus

Internal Focus

Flexible Stable

2003

73

64

67 54

63

39

50

57

82

44 57

44Beliefs and Assumptions

N = 4531

NANANA

NA

NA

NANANA

NA

NA

NA

NA

External Focus

Internal Focus

Flexible Stable

2004

75

63

70 59

72

47

63

61

83

54

66

59Beliefs and

Assumptions

N = 6972

Henkel Overall

NANANA

NA

NA

NANANA

NA

NA

NA

NA

External Focus

Internal Focus

Flexible Stable

2003

73

64

67 54

63

39

50

57

82

44 57

44Beliefs and Assumptions

N = 4531

NANANA

NA

NA

NANANA

NA

NA

NA

NA

External Focus

Internal Focus

Flexible Stable

2004

75

63

70 59

72

47

63

61

83

54

66

59Beliefs and

Assumptions

N = 6972

Figure 1 = Henkel Overall 2003 to 20042003 2004

N = 4531 N = 6972


Figure 2 = Business Unit 1each area, for example, “enact cross-di-visional job rotation” and “holding weekly current affairs meetings”. Defining action-able plans within many different countries and departments had an effect on driving change for the broader business unit as a whole (See Figure 2). As a result, Unit 1 saw a large improvement in their scores from 2003 to 2004, especially in Core Values and Coordination and Integration. In contrast, Business Unit 2 recorded few plans after the 2003 survey and conse-quently saw little change, and in some cases, even decreased in scores on the 2004 survey (see Figure 3). This reinforced the importance of recording and develop-ing specific action plans targeted to the level of the organization where you want to drive change.

The effects of action planning could also be seen at the country-level. Country A developed country-level action plans that focused on vision, values, and strategy which resulted in a 76% increase in scores in 2004 (see Figure 4). However, while a large number of action plans were defined for the broader geographic region (which included Country B along with three other countries), no plans were identified at the country-level for Country B which resulted in a decrease in Country B’s scores in 2004 (see Figure 5).

Taken together, these findings suggest that it is important to incorporate ac-tion planning within the survey process to bring about positive, tangible change. The results of the 2004 survey indicate that the greatest improvements between the 2003 and 2004 surveys were in those departments or levels that specifically targeted a few key areas for improvement and identified a few courses of action that would be taken to drive change. Those levels of the organization that did not record specific action plans generally did not change to the same degree. It also appears that more was gained by devel-oping action plans at specific levels of

Figure 3 = Business Unit 2

Figure 4 = Country A

0

Business Unit 12003 2004

255075100 25 50 75 100

Gap Report

Involvement

68 88Empowerment 20

54 77Team Orientation 23

82 90Capability Development 8

Consistency

39 77Core Values 38

66 91Agreement 25

39 77Coordination & Integration 38

Adaptability

71 89Creating Change 18

78 91Customer Focus 13

87 94Organizational Learning 7

Mission

46 83Strategic Direction & Intent 37

61 88Goals & Objectives 27

40 82Vision 42

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Percentile Scorefor group on left

Percentile Scorefor group on right

Bar on left indicates this grouphas a higher percentile score

Bar on right indicates this group has a higher percentile score

0

Business Unit 22003 2004

255075100 25 50 75 100

Gap Report

Involvement

48 65Empowerment 17



Consistency

42 31Core Values 11

59 64Agreement 5


Adaptability




Mission



38 24Vision 14

09-Oct-07





0

Country A2003 2004

255075100 25 50 75 100

Gap Report

Involvement

64 92Empowerment 28



Consistency

55 89Core Values 34

26 83Agreement 57


Adaptability




Mission



9 88Vision 79

09-Oct-07





All content © copyright 2005-2007 Denison Consulting, LLC All rights reserved. l www.denisonculture.com l

the organization than when action plans were developed at broader organizational levels. Using Business Unit 1 as an example, when action plans were developed at specific levels within the organization (e.g. Unit 1: Spain, Unit 1: UK) not only did those specific levels improve, but the effects of these plans also seemed to bubble-up and drive change at broader organizational levels. However, the effect does not appear to go both ways. Action plans developed at broader organizational levels (e.g. an entire geographic region) did not seem to trickle-down to impact more specific levels (e.g. countries within that region).

Aside from these broad conclusions about the action planning process, Henkel also learned the value of systematically tracking the action planning process. In order to improve action planning throughout the organization, Henkel needed a better understanding of the things that worked and didn’t work. Not only was it necessary to improve upon how action plans are tracked but also to track how or if plans were implemented, what the timeframes were, how the change process was communicated and who was involved.

Driven by a desire to ensure that all areas of the organization see

improvement over time, Henkel began using The Denison Action Planner: A Dynamic Tool for Implementing Change, after the 2006 survey. The Denison Action Planner is designed to translate survey results into action by ensuring that the important aspects of the action planning process are easily recorded, monitored and summarized. A Web-based tool, the Denison Action Planner allows for easy communication and collaboration throughout the change process from initial brainstorming to selecting areas of focus, and tracking the implementation of actionable items. Using action planning best practices, this tool helps ensure that the change process is successful and allows organizations to better understand how to make the process a success in the future.

Related Resources

This case study is based on: Deni-son, D. R. & Schlue, R. (2007). Managing Corporate Culture at Henkel: Applying the Denison Orga-nizational Culture Survey. Gütersloh, Germany: Bertelsmann Stiftung

Contact Information

Denison Consulting, LLC121 West Washington, Suite 201Ann Arbor, Michigan 48104Phone: (734) 302-4002Fax: (734) 302-4023Email: [email protected]

Copyright Information

Copyright 2005-2008 Denison Consulting, LLCAll Rights Reserved.Unauthorized reproduction, in any manner, is prohibited.The Denison model, circumplex and survey are trade-marks of Denison Consulting, LLC.Version 1.0, October 2007

Figure 5 = Country B

0

Country B2003 2004

255075100 25 50 75 100

Gap Report

Involvement

63 47Empowerment 16



Consistency

40 38Core Values 2

60 48Agreement 12


Adaptability




Mission



38 38Vision 0

09-Oct-07



