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crowd on chessboardCompany culture is a curious thing.  When a company is young it grows without explicit guidance, typically driven by the founding entrepreneurs and their values.  But the larger the company, the more static the culture becomes. 

Culture is manifested through the people who make up the organization.  So how much can you change the culture, without turning over at least some of the people?  When a large company wants to shift its culture, there are many tools that can be brought to bear.  But how deep is the change if you look around and see the same faces as have always been there?

A culture that didn’t change.   As the Deepwater Horizon was spewing oil into the Gulf of Mexico, Tony Hayward, CEO of BP got massive negative press for saying “I want my life back.”  To the media and the public, his statement demonstrated a corporate culture that was entirely self-centered, where “it is all about me” and it implied that the biggest concern for BP was the inconvenience the spill caused him and the company.  Many people assumed the impact on the environment and the people of the Gulf coast must be secondary concerns if the guy at the top of BP was worrying about himself enough to complain publicly.

deepwater-horizon-explosionSome people argued the criticism was unfair.  That Hayward had spent several years changing the culture, focusing the company on safety and that his comment just reflected a moment of stress. 

I’m not so sure.  Hayward’s attitude was exactly the same as at least one other senior BP executive’s, as expressed after their last Gulf region disaster.  In 2005, an explosion at BP’s Texas City oil refinery killed 15 workers and injured 170.  The Associated Press, reporting on the subsequent trial in 2007, said John Manzoni, BP’s former refining and marketing chief executive, sent an email complaining that he had to spend the day at Texas City right after the accident “at the cost of a precious day of my leave.”  Manzoni was on a skiing vacation in Colorado when the accident happened.

It strikes me that maybe BP’s culture has not really changed that much, if major catastrophes are still viewed as “inconveniences” by senior management.  Hayward has moved on, but I doubt that will do much to shift the culture.

A culture that changed too much.  Recently I’ve begun working with a small pharma company.  The CHRO says they are engaging in a “re-transformation.”  Over the last few years they expanded, and added a lot of people from bigger pharma companies, including a new president.  As the business grew, there had been a feeling that more structure was needed, and perhaps it was time to move beyond some of their entrepreneurial ways.  A year or so into the process, things weren’t going so well.  Flexibility and agility were rapidly being replaced with bureaucracy and silos. 

Now they are “re-transforming” back into a nimble, responsive organization with a focus on innovation and risk-taking.  And a lot of the newer employees are suddenly very uncomfortable.  In fact, quite a few have been transitioned back out of the company – including that new president.  An interesting case study in how changes in the people making up the company can really drive the evolution of its culture.

I believe that it is possible to change culture without wholesale changes in personnel.  But it requires more than training and communication programs.  You need a systematic, long term effort, including regular assessments such as employee surveys.  But some current employees and leaders won’t be a fit with the new culture, so you also have to be prepared to make a few replacements.

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by Jerry Seibert | Categories: Engagement, People Equity | Comments Off