Entries in organizational culture (33)


John Van Maanen, Catalyst fellow, on teaching leadership

Writing in the New York Times Education Life column on Tuesday, author Duff McDonald examines the issue of what, exactly, business schools are teaching. Noting the overwhelming shift in these schools' marketing and communications materials away from from a focus on "management" and towards "leadership," the piece raised the question of whether leadership can, in fact, be taught.

Specifically, the Times turned to John Van Maanen, a Catalyst Culture Lab fellow.

"John Van Maanen, a professor of management at M.I.T. Sloan who teaches a course named “Leading Organizations,” isn’t so sure it can. “Even today, three-plus decades in, there’s no real definition of it,” he says. “We can make people more conscious of ethical dilemmas in business, of the difficulty of directing people in times of adversity, and the confidence and communication skills necessary to do so. But the idea that such skills can be transmitted so that you can lead anybody at any time, that’s ideologically vacuous.”

“It’s difficult not to be frustrated by the excessive focus on it,” he says, “but it’s become so popular that we apparently can’t teach enough of it.”

McDonald concludes by noting that Dr. Van Maanen is not alone in his skepticism. What do you think?

Image source: New York Times

-- Clara Shen


Culture and behavior

Are some differences in individuals' behavior--in the workplace or in the consumer space--the result of echoes of cultural activities and trends going back thousands of years? One team of researchers at the University of British Columbia argues that they are.

The team, lead by Joseph Henrich, wrote a paper titled "Weird People" that makes the case that broad findings about human psychology and behaviour are most often based on extremely narrow samples from Western societies. Furthermore, these sample pools, drawn from highly educated elements of society, are in fact outliers that do not represent the majority of humanity. It goes on to caution making assertions about "human nature" based on data collected from narrow subject pool, and to recommend using broader subject pools in future research.

Members of Western, educated, industrialized, rich, and democratic societies, including young children, are among the least representative populations one could find for generalizing about humans."

Henrich employs tests based on game theory, and his results gathered from subject pools across the globe show startling differences in baseline behaviors. This Pacific Standard profile of his team's work notes that it is part of a "small but growing countertrend in the social sciences, one in which researchers look straight at the question of how deeply culture shapes human cognition," and cites some other interesting exploration in this area.

These questions have potentially profound implications for work related to organizational culture and consumer demand, and we may just be at the starting point in this type of research.

-- Jia Yan Toh


Deloitte on realigning performance management

A new report from Deloitte highlights the strength of the trend away from traditional performance management systems -- some 89% of companies surveyed have recently changed their process or plan to change it within 18 months.  What's driving this movement?

Interestingly, it's often the desire to align the processes used to manage a company's human capital with its business strategy and culture. Traditional performance management systems do not address some of the biggest challenges companies face today, including employee engagement, retention, and capability development, and in many cases they were making things worse.

Deloitte has recently revamped it's own approach, as detailed in an HBR article this month. The new approach separates compensation decisions from day-to-day performance management, produces better insight through quarterly or per-project “performance snapshots,” and relies on weekly check-ins with managers to keep performance on course.

Image source: Deloitte

-- Segundo Saenz


SC Johnson case -- a test of values

An article in the current edition of Harvard Business Review captures the dynamics of managing a privately owned business with strong, long-held values and the tough decisions these companies are faced with on many levels.
In it, the CEO of SC Johnson presents a case study of sorts based on the company's Saran Wrap product. Framed in terms of "revenue vs. goodwill," the piece talked about the pressures he faced when deciding whether to replace the existing, successful product with a reformulated one that eliminated a questionable chemical but had inferior performance.
The goodwill of people is the only enduring thing in any business. The rest is shadow"

Ultimately, the company went with the reformulated product. As a privately held venture it did not face a shareholder backlash, but it was not an easy decision by any means. Inside the company there were vocal proponents of sticking with the existing formula beforehand, and afterwards the brand's financial performance did suffer as its relative market share dropped.

CEO Fisk Johnson maintains it was the right decision, based on the longstanding values of the company that put trustworthiness above all else. "Back in 1927 my great-grandfather said something that has been a guiding principle for me throughout my career: 'The goodwill of people is the only enduring thing in any business. The rest is shadow.'”
Across the corporate world we see a growing number of companies making commitments to higher values -- though we also see market pressures pushing managers arguably in an opposite direction. This is a tension we will see arise more often, and in more high-stakes decisions than before.
Key questions from examples like the Saran Wrap case include:
  1. When core values conflict with financial performance, what is the deciding factor?
  2. And what are the time horizons that will be used to make the decision -- will the calculation look at the long-term or the immediate impact?
-- Segundo Saenz & Bojan Angelov

Catalyst Content Briefing 24 March 2015

In this week's look at what's new and interesting:

•         Businesses need to collaborate to address sustainability challenges
•         Banding together to solve major problems
•         Mergers thrive when capabilities are a strong fit
•         Properly fostering intrapreneurship can encourage success
•         Helping customers understand percentages can boost business

Businesses need to collaborate to address sustainability challenges
February 1, 2015
In January 2015, co-authors David Kiron and Knut Haanaes presented findings from the "Joining Forces: Collaboration and Leadership for Sustainability" study, which discussed the benefits of collaborating for sustainability. They presented their findings on what makes successful collaborations, which include shared language, due diligence and the right entrance and exit strategies. They study found that 90% of respondents agreed that businesses need to collaborate to address sustainability challenges, and 61% of executives whose companies participated in sustainability-related partnerships view these collaborations as quite or very successful. The complete webinar can be found here.
source:  MIT Sloan

Banding together to solve major problems
March 10, 2015
In Jinotega, Nicaragua, a collective of representatives for the world's biggest coffee brands and leading NGOs - including Keurig, Starbucks, the Specialty Coffee Association of America, Farmer Brothers, Counter Culture Coffee, and Mercy Corps - band together every year to help coffee farmers deal with not only the regular aspects of the coffee bean business, but also more pressing concerns afflicting those who provide their product. The "Coalition for Coffee Communities" use their collective weight and expertise in a quest to improve coffee-growing communities around the world. For example, farmers in Jinotega are struggling with seasonal hunger, as many in the region find their harvests are too small to support their family for a full year, and are dealing with a complex intersection of climate change, weak local government, few options for financial credit, and limited agriculture extension services - a set of problems too big for any one company to tackle alone.

In Nicaragua, the coalition has partnered with Mercy Corps and Aldea Global, an association of smallholder farmers launched by Mercy Corps in 1992. The association has grown substantially, today working with 2,200 farming families and 12 cooperatives, generating a loan portfolio of $2.4 million for its members to borrow and expand their farms and small businesses. The group is also working with farmers to bring back some of those traditional practices, but with a new spin - adding an extra source of income wherever possible, like intercropping bananas and citrus trees. By accepting these new ideas and partnerships into the coalition, what originally started as a few has grown substantially, and is making headway in helping deal with problems farmers face. Building on its beginnings as a tight-knit group of companies and associations piloting ideas focused on food security, the group plans to become "a hub for thought leadership, investment and action."
source: Next Billion

Mergers thrive when capabilities are a strong fit
March 10, 2015
Gerald Adolph, co-author of Merge Ahead: Mastering the Five Enduring Trends of Masterful M&A, examines why some companies fail when it comes to executing a merger and others succeed. He said those that succeed are based on a strong capabilities fit. While post-merger integration is a key piece of the puzzle, the best integration planning can't cure a deal that should never have happened. Only those M&A deals that either enhance each company's distinctive capabilities systems or leverage those systems - or both - have a shot at real success. A capabilities system is very specific: three to six mutually reinforcing, distinctive capabilities that are organized to support and drive the company's strategy, integrating people, processes and technologies to produce something of value for customers. Clarity and specificity from the start is critical, and can smooth integration, even when the companies don't have much in common. The most successful deals are those in which an acquiring company took a capability of its own and leveraged it in the newly acquired company. The second most successful ones were those companies that acquired a capability that could then be leveraged to enhance their own capabilities.

Dangers still remain when it comes to picking the right M&A, however. No matter how good they look, some mergers are doomed because they happen as a result of pressure from stakeholders responding to a current trend. When the economy recesses, for example, people want to retrench and consolidate rather than diversify or grow. In other cases, a company will bite off more than it can chew, and lose sight of its goal. Even with the best-laid plans, the integration can fail on the people end, however, there is a learning opportunity here. By starting the process with a focus on capabilities, CEOs can not only choose the right partners but also ensure that they preserve what is special about the company they're buying—not to mention their own.
source: Chief Executive

Properly fostering intrapreneurship can encourage success
February 27, 2015
With the economy rebounding, employers are again fostering intraprerneurship among their employees. Though, given the still shaky financial atmosphere, successfully fostering employee potential can be tricky. To get things off on the right foot, one has to make sure there's a solid leader at the helm. Leadership must provide the air cover required to protect bottom-up ideas so, as the best ideas mature, they can be promoted within the organization and embraced from the top down. Creating the right culture is also key to building the right environment. This can be achieved by giving team members creative tasks that they are passionate about, as well as encouraging them to share their innovative ideas.

Ideas won't be shared, however, if employees feel like they won't be properly recognized, which could actually lead to a less inspired environment. To avoid this, it is crucial that higher-ups encourage transparency at all stages of innovation. Incentives also help, which can include the opportunity to run with a successful innovation, public recognition, and access to accelerated career path opportunities, though companies should build a reward structure that encourages all employees to contribute to the success of the overall organization. However, not every idea will be a success, so innovators should be prepared for failure. By giving team members a positive response for a negative outcome, companies are rewarding them for taking a calculated risk, which in turn can lead to them taking more risks in the future and encouraging a constant cycle of intraprerneurship.
source: Forbes


Helping customers understand percentages can boost business
March 10, 2015
Research found that most consumers, even highly educated ones, are bad at percentages. Offer an average shopper a choice between 50% more product per dollar and a 35% price reduction, and the majority will pick 50% more volume, thinking that it's a better deal, but it's not. The 35% cost reduction leads to a 54% improvement in price per unit of volume whereas the 50% benefit increase only leads to a 50% improvement in unit price. Faced with a choice between two marketing offers with percentages, consumers almost always opt for the largest percentage without calculating its impact in terms of cost/benefit (or benefit/cost) rate. What consumers fail to see is that percentage cost discounts always beat percentage benefit bonuses.

This approach has been good for marketers, as it gives the perception of a better deal despite it not actually being so, though customers have access to more information than ever before and their patience for corporate self-interest is wearing thin. These clever ploys won't last forever, which is where companies can step in and offer assistance. Companies seen as protecting their customers and giving them value will come off as more authentic and trustworthy. Studies show that more transparency helps consumers to make more informed decisions, regardless of how good they are at percentages.

Source: INSEAD Knowledge