Case Study: Building the "Ideal" Culture

Our case studies are presented as an opportunity to learn from the successes and setbacks experienced by other organizations. Since no company or individual is perfect, and we can learn a great deal from the missteps of others, we will openly discuss errors, mistakes and false starts. For this reason our clients are not identified. The following case questions the viability of an “ideal corporate culture” suitable for all.

If one were to build a list of the top 10 terms used in today’s organizations, I’m certain that the hit-parade of buzzwords would include the word “culture”. I’m not sure when it first came to prominence but would guess it was at about the same time that North American businesses realized that the world was moving far more quickly, and that rapid change was required. Soon after this they discovered that changing strategies didn’t work very well unless you also changed your culture to support your new direction.

Since then, the challenge of successfully changing culture has entered the forefront of organizational development. We have learned a lot about how to successfully change culture, and there are many excellent books, training programs and videos, that provide excellent advice.

But there’s another set of learning products that go a step further. These are the books, courses etc. that describe an “ideal culture.” Typically the author has conducted research into a number of successful companies, seeking the cultural elements that all share. These shared elements are then presented as “the ideal culture”. The author then proclaims that these elements will bring your company instant success, and promises that if you buy his book, watch his video, or go to her workshop, you’ll be taught to achieve this ideal. It’s this concept of ideal culture which is the focus of this article, and I’ll make my point with a case study.

Early in my consulting career, I was asked by the CEO of a medium sized manufacturing organization if I would work with him and his VPs to change the culture of the organization. He described an exciting and ambitious strategy in which he envisioned growing from a small local company to a large national and international entity. I of course jumped at the chance, and over the next 10 years this company became not only the primary focus of my consulting practice but also one of the most effective learning experiences of my career to that time.

My involvement was at all levels. At the most senior, I facilitated strategy sessions involving the board of directors and the executive. I then facilitated strategic retreats of the executive team where the business of growth was planned and executed. At other levels in the organization, I worked closely with the HR department and conducted employee surveys, followed by employee focus groups. I delivered management workshops and coached individual managers. I developed and helped implement a performance management system, developed a management assessment centre and helped select new managers. In short I was involved in supporting management through every stage of the culture change process. As a result, I learned more than any course or book could teach. Here, described briefly, are a few of the most important lessons:

• You’ll notice that earlier in this piece I slipped in the phrase “over the next ten years’. That term reflects my first lesson about cultural change. It takes a heck of a long time, and the larger the company and the more profound the change, the longer it takes. It this case, over the ten years, there were several mergers and acquisitions, so an important element of the change process became melding the cultures of the acquiring with the acquired.
• The second thing I learned was that the road to cultural change isn’t straight, it is extremely convoluted. Most books about change describe it as a simple step by step process. Although one can start with such a plan, it never turns out that way. Change is often chaotic. There are setbacks, mistakes and tactical changes. Managers are sometimes forced to take drastic action against team members who act as anchors on the change process. All these things happened in this case, but the important thing; something that isn’t emphasised enough in the change literature is that the CEO and his key executives had the strength of belief and the perseverance to overcome the setbacks and forge ahead. Without that perseverance, change could not succeed.
• The final important point can only be described in the context of how this story ended. The company in question did realize its growth goals and its change goals. It became a national presence and was poised to move into the United States. It succeeded, not because of the new culture but because of the canny acquisitions and the competitive strategy, supported by the appropriate culture. However, in achieving its success, it stretched itself financially and itself became an acquisition target. Subsequently it was swallowed by a large multi-national. It was then that the final learning point hit home. Within 2-3 years, all but one of the original executives had left the new company. The reason they left, although they may not describe it in these terms, was the new culture. The culture they had worked so hard to develop was appropriate for a rapidly growing, small business trying to become a large business. The new culture was that of a large, paternalistic multi-national that treated them as a slow growth “cash cow”. Such a culture was totally appropriate for the larger company but very different to the culture that led the smaller company to its success. The executive team members, who had thrived in the original culture, could not live in the new. The lesson here is an important one. There is no such thing as an ideal culture suitable for all organizations.

For more information contact Bob Power