Leading Workplace Change™

Economic instability is still with us.  And, we keep hearing it is going to take awhile to work ourselves out of this financial crisis of the new global age.  Consequently, patience and building for the future are tactics driving my actions these days.  In the last three posts, I wrote about differing culture characteristics that allowed certain companies to historically move through hard economic times and to endure.  These characteristics are:

- An optimistic spirit (companies in cyclical industries)

- An ability to adapt (Goldman Sachs)

- A commitment to a long-term vision (UPS)

I realize, reading about organizational culture best practices is easy, but building for the future by engraining new ways of thinking and working is not.  According to recently passed management guru Peter Drucker, “…changing behavior works only if it can be based on the existing culture.” (Don’t Change Corporate Culture–Use It, Wall Street Journal, 3/19/01).  He gave examples in his short article from 1991 about how Japan and Germany re-built their societies after the Second World War through rewarding new habits based on traditional national values.  Today, it is still the most reliable and quickest way to re-direct an organizational culture over time as well.  An important qualifier is that you must believe the traditional values will support future success.

So how does one start for example to build an organizational ability to adapt and to see change as an opportunity?  Drucker had ideas about this as well.  He recommended seeking out individuals or groups within your organization that already exhibit these habits and ask them how they do it.  Once these attitudes and ways of working are specifically defined for your organization, the next task is to shift recognitions, rewards and consequences in support of the new desired habits and behaviors. 

And for those who find analogies helpful, there are similarities in the process of culture re-direction to the best practices for raising children; so as any dedicated parent knows, achieving results will require patience and a willingness by organizational leaders to model new behaviors as much as using rewards and adverse consequences.

Tags: Corporate Culture Observer, Leaders Leading by Terri – older, but wiser white lady
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In this time of deep economic turmoil, I am thinking about what kinds of culture characteristics allows one company to survive while others go bankrupt?  Last week, I wrote about one survival characteristic - commitment to a long-term vision.  This characteristic guides leaders to balance short-term business decisions against how well the decision helps the company achieve its long-term strategies.  In my reading about the financial companies that are surviving today’s economic turmoil, other culture best practices are emerging – one is ability to adapt.

On Wall Street, one of the companies surviving recent events as an independent company is Goldman Sachs.  And, in an article in the New York Times, (Wall Street, R.I.P. by Julie Creswell & Ben White 9/28/08) it is possible to identify a few clues on how adaptability is one of the keys to Goldman’s survival.

“They change to fit their environment. When it was good to go public, they went public,” said Michael Mayo, banking analyst at Deutsche Bank. “When it was good to get big in fixed income, they got big in fixed income. When it was good to get into emerging markets, they got into emerging markets. Now that it’s good to be a bank, they became a bank.”

Many companies we work with strive for this ability to adapt as epitomized by Goldman, but it is not easy to engrain in a culture if it is not there naturally.  Goldman, founded in 1869 has survived as an independent company for almost 150 years, starting as a partnership and changing to a public company in 1999.  Some of the common practices that I would expect to find supported in their workplace are: risk taking and creativity if backed up by data or experience; and, expectations for individuals to learn from mistakes and to see change as an opportunity, not as a threat.

The learning for leaders is not straightforward in this example as adaptability is one of the rarest culture characteristics we find naturally engrained in organizations.  It is not easy to take culture best practices and apply them wholesale to another organization, even in the same industry.  The best first step is to include a culture diagnosis of your own organization as part of a strategic planning effort. Next, the leadership team will need to model the attitudes and behaviors they decide are required for the organization to succeed in a time of economic turmoil.  The first new attitude might just be - seeing change as an opportunity and not as a threat!

Tags: Corporate Culture Observer, Leaders Leading by Terri – older, but wiser white lady
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