Fix the Culture!

culture

How many CEO’s value the culture of their organizations as the main driver of the company’s success?  How many really take the time to define what the culture should be, cultivate it, nurture it, and the most difficult part, make sure all employees uphold it?  We’re talking way beyond posting Core Values on conference room walls and on the website.  To answer our question, we would say far fewer CEO’s are treating the culture with the respect it deserves.

Core values should be the guiding principles for all employees to follow when making decisions and deciding what actions to take. However, employees’ behaviors and actions don’t always match the stated core values.  And these actions which deviate from those expected – even small ones – if left uncorrected can lead to the slippery slope of culture decline and later to a company’s demise.

Here’s a good example of what we are talking about.  GM’s Core Values are stated as: “Integrity, Individual Respect and Responsibility”. Now let’s consider their actions…we’re sure many of you have followed the woes of GM’s ignition-switch recall.  Under certain conditions, the faulty switch caused the car to slip from the “run” position to “accessories” which was possibly linked to 31 crashes and 13 fatalities.  An engineer testified that GM made a “business decision” not to replace the $2 part. So what went wrong?  On GM’s website you see that employees are trained annually on “Winning with Integrity”.  The right words are in place, and employees were trained?  But where was the accountability or the “teeth” in the process to ensure the words drive each employee’s actions?  We would bet that no one individual set out to use a defective part that could cause so much damage, but rather, slowly, gradually actions were taken, decisions were made, behaviors chosen that eroded the core values.  What became allowable or acceptable was not upholding the Core Values they stated.  No one “called” people on their misgivings or gave them feedback to correct their wayward behaviors.

Compare this to the recent success of Ford.  In the April issue of Fortune magazine, Ford’s CEO Alan Mullaly was given credit for “saving the company without resorting to bankruptcy or bailouts by doing what previous leaders had tried and failed to do: change Ford’s risk-averse, reality-denying, CYA-based culture.”  Last year, Ford earned $7.2 billion in profit – far more that GM or Chrysler. You can bet Mullaly did more than posting the new Core Values on the walls to get that huge organization to change their ways. You can’t change a culture and keep all the same people, so we’d bet some of the key positions have new incumbents too.

Here’s another CEO who is taking culture very seriously. After hearing a major investor’s most important advice, “Don’t [mess] up the culture (only he didn’t use the word “mess”), Brian Chesky, CEO of Airbnb, sent an email to his team.  That email has now gone viral – you may have seen it…in Working Life called “Don’t [Mess] Up The Culture”.

In that email to his team he instructs that their next team meeting will be dedicated to Core Values, and prior to that meeting he wanted people to know why culture is important.  Here’s one of the things he said, “By upholding our core values in everything we do. Culture is a thousand things, a thousand times. It’s living the core values when you hire; when you write an email; when you are working on a project; when you are walking in the hall. We have the power, by living the values, to build the culture. We also have the power, by breaking the values, to [mess] up the culture. Each one of us has this opportunity, this burden.”

We couldn’t have said it better ourselves.

Mary Barra, GM’s new CEO, needs to fix an entrenched culture-and quickly-if she is going to succeed. Maybe she needs to start with a similar email to her team.