Strange Ways that Organizations Change their Culture

Consultants do not change organizational culture. Consultants and management can change the way that things are done, and as a result culture is perceived as having changed. But there are much faster and different  ways that culture changes. Here are a few.

  • Get a major customer in Japan. This will drive a positive change in customer focus, product quality, and the creation of a long term account strategy.
  • Get heavily fined. If the court slaps a crippling fine on an organization for any one of many infringements, culture changes much more quickly. This works incredibly well especially if the management team is arrogant and self-serving.
  • Be acquired. If an organization is acquired, its culture is usually decimated with a few months to a few years. Cultures die upon acquisition.
  • Massive failures drive cultural change. This includes loss of major clients, severe prolonged fall in stock price or military defeat.
  • Departure or death of a founder. Departing dominant founders who fail to produce the next generation of leadership (especially but not only in family businesses) will trigger a rapid change of culture, not necessarily for the better.

Sadly, companies hire consultants to change culture and it always, always fails, unless external factors are leveraged to harness the change.

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Second Time OD

From time to time, an organization can attempt a OD endeavour a second time, after a first attempt has failed.

For the consultant, this is a challenge with many pitfalls, and in this post I will spell them out, with a few recommendations.

  • The previous consultant did good work, but the organization wanted fun and wow wow wow. This can happen when the work was commissioned by an internal OD and Training Manager, who is fearful for her/his standing in the organization. Example: Galit (internal OD) wanted the sales team to improve their soft skills. The consultant recognized that the products that the Sales team were failing to sell are of low quality and highly priced. But the VP of Engineering has a lot of clout with investors, so it is difficult to remove him to improve product quality. The consultant asked to investigate this issue in more depth and was fired for “poking around and overstepping his mandate”. In cases such as these, 2nd time OD will probably fail, unless the consultant also practices the second oldest profession in the world.

 

  • The previous consultant did poor work and was booted out. I have replaced Kumbaya consultants, rigid old-fashioned consultants who promulgate OD’s western values in the wrong places, flirtatious ladies, and consultants who just did not have the brain power to do the right things. However, the motive of “doing better work than my predecessors” is not a smart one, because it becomes “all about you”. The correct mindset is that the organization, not you, are trying again. If YOU want to succeed where your competition failed, you are setting yourself to be knocked out by your own ambition. Focus on what needs to be done, not where others failed.

 

  • For certain types of clients, second time OD is very difficult. Organizations with a very strong culture which has become a religion are prone to fail because the OD consultant, if not a high priest of the religion, is a heretic. I remember doing a project where transparency was a religion. Of course, it was not, but it was forbidden to admit it. Or I worked for an organization where every decision had to be made by consensus. This of course never occurred, but again, saying so was heresy.So, take a look at WHY your predecessor failed, and if you observe that the organization probably failed because it is impervious to change, but cannot admit it, stay away.
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Why things get worse when an OD intervention starts-and what to do about it

Don’t believe those who say that OD cannot make things worse. The truth is that OD does develop organizations, enabling them to better leverage horizontal team work between functions, mitigate unnecessary escalations, and repair organizational “bugs” by re-empowering people to evoke common sense. However this takes time and initially, things get worse.

Here’s why.

When people start talking about their problems, their expectations go up. However the speed of change is much slower than the rise in the level of expectations. The result is the perception that things are getting worse. This is common sense.

OD projects change the allocation of power generally from top to bottom, but also from side to side, ie, from one function to another. People resist these changes and fight back. How often? Always. For how long? As long as management is not consistent in supporting the change effort.

OD projects have opposition. The opposition arises from managers who see impending threats, from internal OD who moan and groan why they are not allowed to do the work, and from Finance since professional OD is expensive. Often the internal opposition initially creates lots of noise to undermine the success of the OD project.

OD efforts are often trial and error. The trials are sometimes unfortunately similar to finding a good antidepressant-it takes time and some pain.

Change is painful, and very often old problems disappear and new ones surface. Because OD does not solve problems, it replaces them with new ones, of a different magnitude. For example: we have now empowered our hotel maintenance staff to order spare parts directly without going thru the Hotels’ Management Chain’s purchasing bureaucracy. Maintenance is faster; guests are not complaining any more.  But now we need to change the methods/ culture of control and recruitment. New problems. New pain.

My suggestion is that an OD consultant always inform and explain this “initial setback” when before signing up for a job. If the management wants fun and wow, it’s better to clear this up front, and not get burnt.

And remember, HR and internal OD have a VERY low pain threshold, especially if they are the ones that have chosen you to do the work.

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Accessing the Political Skills of Potential Job Candidates

We all know how hard it is to access the compatibility of candidates for a job. Tests, interviews, graphologists, peer interviews: we have all had to eat our humble pie after massive errors of judgement.

I have been way off many times and I am not kind to myself after I miss. But thankfully, my clients are nicer to me than I am to myself because I try to do my best to innovate in order to improve.

One of the factors that I try to access in each interview is the level of political savvy that a potential client has, since more often than not, it is the organizational politics that plays a critical role in the adjustment of the candidate. There are a lot of organizations which don’t test for political skills, especially organizations that are very political. The army and family businesses are a good example, as are large and older organizations.

I will provide some examples of how I try to access political skills.

  • For a family organization

The CEO, your boss, is extremely dominating. Furthermore, some of his critical decisions are made in haste. The CEO’s mother wants to speak to you next week. She is the former chairwoman and founder. What are your thoughts? Plans? Fears in any? Describe your approach.

  • For an engineering job at a senior level

You have been asked to submit a budget to present to the Board which covers 60% of what you actually need. Your boss has told you that the budget submission is a political act, and later on down the line, he will allocate “whatever is necessary”. How will you react to your boss’s request?

  • For a business development role for hi-tech

You are about to meet with new investors who may be interested in injecting money into the company for which you work. You have been thinking of jumping ship because the next  product releases are 1) too buggy and 2) too late; you are pretty negative about where your company is heading. You know that these investors will really bad mouth you if you mis-represent, but you need to stay put until you get a new job (which is not easy) because of your mortgage payments. What’s your plan?

These are just a few of the many examples I have developed.

Try doing so next time you are fishing for a candidate. It may add just a bit more of validity in the perilous process of predicting success.

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Organizational Stupidity

Andy Borovitz’s book Profiles in Ignorance documents the increasing degree of stupidity in the political domain, documenting such figures as W Bush, Quayle, Reagan, Pailin and Trump.

Phenomenally funny book. And it got me thinking about stupidity in organizations.

But first and to be fair, the book is one sided.  There are other examples of ignorance BOTH sides of the political scale, such as Kerry’s middle east policy, knocking off Senor Kaddafi, and Carter’s total misreading of Iran as a island of stability just before the old Shah was disposed.

It appears that stupidity is not limited to one side. In organizations, this is doubly true. At face value, organizations have become more sophisticated over time. Augmented by computing power, easier financing terms and a manpower pool from the global economy, vast knowledge about the market, organizations should have become much smarter. But this has not happened.*

Organizations’ increasing stupidity is often fueled by the innovations that they have adopted. In this post, I want to point out examples of organizational stupidity all based on my experience and observation. 

1-Your customer base and our technology acquisition.
We have a great technology but a weak customer base. You have a strong customer base but your technology is weak. So, let’s create synergy by acquisition and sell our technology to your customer base.

And I ask, how stupid do you have to be to know that this seemingly simple plan almost never works, because of all of the personal, political and technical issues involved?

2-ERPs
Enterprise resource planning certainly solved a huge set of issues (speed, compliance, built-in siloism) only to create a shitload of new problems, such as the elimination of common sense, lack of flexibility, process Nazism, and a thriving blaming culture fuelled by constant escalation of issues to senior management to solve problems fueling by these very “integrated” processes.

Sounds stupid? It certainly is, unless you understand that all innovations solve certain problems and create others.

3-Spokesmen and Perfuming Pigs
In an attempt to deal with image problems stemming from the intrusive role of the media, organizations began to view “looking better” as much more important than becoming better. This lofty goal was delegated to the spokesperson, and or course, often times this fueled lack of trust on the part of the consumer, as well as the process of “hiding” information from and by the spokesperson.

Can you really sell a 20 Euro ticket from Barcelona to Rome, or a 15 Euro ticket between London and Dublin or an 8 Euro trip between Cairo and Entebbe whilst providing good service? Can airports handle the inevitable havoc as the serfs and hoards start to wander almost freely? Of course they can’t, but by perfuming the pig, organizations appear to be “cruisin’ for a bruise” and/or digging their own grave.

4-Shadow work
Organizations seem to believe that you work for them. And thus, they download their jobs to their consumers (shadow work), generally via phone support which is often almost impossible to reach. Try installing a new router on your own, or transitioning to fiber optics; try assembling a water filter every six months.
Shadow work denigrates the reputation of companies, results in huge turn over in call centers, and to a lack of customer loyalty.

5-Constant Reorgs

In another post, I have spelt out the stupidity of constant reorganizations.

And back to stupidity, becoming media savvy probably has created politicians who know how to “look good” as opposed to being compatible to the job. And constant innovation and the need to be fast and flexibile have created new organizational configurations, riddled with stupidity.

……………………………………………………..

*Today’s organizations remind me of great boxers with a powerful punch on one hand, like Floyd Patterson or Amir Khan or Vladimir Klitchko, yet with a glass chin- meaning critical weaknesses that leave them exposed to being knocked out in well fell swoop.

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When an OD intervention is stuck

OD interventions are not physics.

It is difficult to predict when an intervention will have sufficient traction to drive change only to slow down, unravel itself back to square one, or even suddenly regress only to be worse than it was in the beginning.

In this post, I want to provide a few guidelines (about what can be done when things get stuck)  that I follow myself and also suggest to the people I supervise.

  1. Defocus. Instead of working on one or two directions, try several directions, all at the same time. This will enable to work with what you have. Remember, organizations can be very unpredictable.
  2. Use the “stuck in a snowbank” routine. Well, I’d better explain. I learnt to drive in Quebec during January’s severe winters. When stuck in snow, you can move you steering wheel slightly to the right and left, then go slowly back and forward, then back and forward, rocking your way out. So, applied to organizational development, this would mean: look at your mandate, widen it or narrow it down, and/or don’t apply constant pressure in the same direction. Or, push forward and allow things to regress, then go forward again and again, and back, until there is change.
  3. Look for hidden agendas. Who is benefitting by the lack of progress? Is someone in HR trying to replace you as a vendor? Is the CFO trying to cut down costs? Is your client just stringing along with you to please his boss.
  4. And never think about you. Change is not about your success, but rather the success of the organization. If you want faster change to make yourself look good, you are in the wrong business. So when things get rough, don’t make stupid mistakes and get thrown out in a futile attempts to look good.

 

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Suggested emphases for Organization Improvement in 2023

Yeah, I know. 2023 plans have already been put in place and signed off on. What can I do?

Perhaps I am not the Speedy Gonzales that I used to be.  

Nevertheless, a bit late,  here is a list of things that I will continue to look at closely in my diagnostic work in this coming year.

  • To what degree has digitalization negatively impacted interface with the customer base and what is the recovery strategy for this?
  • What types of skills are to be lost with the introduction of artificial intelligence of different sorts? Has there been appropriate risk mitigation?
  • For which organizational weaknesses do the “product heroes” compensate? What plans are in place if these heroes jump ship?
  • Where has common sense been eliminated by process Nazism? How is it possible to restore the rule of common sense in such situations? And as US-based consultant Peter Altschul has added more about common sense in personal correspondance, “what is the relationship between common sense and policy? How do the two influence each other? To what extent is common sense connected with culture?”
  • How can in house communication and trust be improved by making sure that electronic communication is not used to blame or transfer hot potatoes?
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The problem with transparency as a corporate value

Yes, lots of firms have Transparency as one of the core values embedded on their flag.

But what is embedded on the company flag is very often what companies have a great deal of problems accomplishing. So instead of doing it, they subscribe to values like Transparency mainly as a symbolic gesture and/or as an esposed (as opposed to actual) religion.

Transparency as a core value is extremely problematic for several reasons which I will point out in this post. If you are a reader based in the west and doing business in the west, read this anyway because it may apply to you.

  • Many companies misrepresent their capabilities during the sales process. Subsequently, they misrepresent expected timetables. Upon delivery, the client can be surprised or unhappy about what was delivered, yet keeps on buying because of the temporary advantage that the product delivers. IF A COMPANY IS NOT TRANSPARENT WITH ITS CLIENTS, THERE IS ZERO CHANCE FOR INTERNAL TRANSPARENCY.
  • In many parts of Asia (especially China and Taiwan), Russia & the FSU as well as the Middle East, Transparency is often seen as a bizarre western quirk. The common approach is “why share knowledge i.e, power? Why give others an advantage? Why expose weaknesses? Transparency will enable HQ to fu-k us! Or other development sites will take our knowledge away”.
  • Being Transparent is indeed is often being stupid for the nerd in the trenches: you get more work; you get more pressure; you are more vulnerable. Not strangely, HR is the function which most often promulgates Transparency because it is easier to manipulate the staff when their guards are down all hyped up by transparency (and authenticity).

Now don’t get me wrong. Transparency is a great enabler of better management and healthier organizations. Ah-ma-ma (a Hebrew slang for “but what”), it is often resisted (justifiably) and not always REALLY beneficial for the interface with the client.

Example:

It’s September and there is a deadline which is impossible to meet in December. If I am transparent, I will voice my opinion immediately and will be worked to the bone from now on. If I surface my “concerns” in December just before the deadline, I will have just a few days/weeks of pressure and the delivery will be rescheduled.

Okay, so you have reached this far and and think, “he’s crazy, of course I want my organization to support and celebrate Transparency.”  Just to make sure, take this small test:

  1. Do you support the idea that staff share one another’s salaries, perks and bonuses with one another?
  2. Is your engineering department free to discuss all the products’ shortcomings with clients, and provide a realistic timeframe for them to be fixed?
  3. Are you willing to diviludge what are the real reasons why highly incompetent people retain their job, even during the most severe downsizing?
  4. Is Supply Chain mandated to negotiate the contracting services so ensure that ALL vendors (not just strategic ones) makes a fair profit AND get paid on time with no lame excuses? Again I emphasize, all vendors.
  5. If you do not give out salary increases when the going is bad, do you compensate when the going is good? Or do you have a bullshit excuse when the going is good as well?

Now, do the math.

 

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Let’s look at leadership close up for a minute

Let’s look at leadership carefully for a moment.

I have worked with several leaders in my career who should never have succeeded.

Kim could not make a decision to save his life. He dithered and dilly dallied and hemmed and hawed. He told everyone what they wanted to hear and when he finally made a decision, he did what he wanted in a clandestine manner, only to be caught red handed. Kim bet on one technology that turned out to be a smashing success, which made him and his team very rich. History was rewritten to make him into a hero and management guru.

Saul was extremely loquacious, and not the brightest lightbulb. His English was mediocre, at best. He spent hours and hours talking to his team members, one on one, to ensure that they were on board with his decisions, which he never made. Saul was a sports fan and often chewed off the ears of his staff with long monologues about what this or that player “should have done”. In a bad year when 3 of the released products failed to produce desired results, Saul managed to sell the unhappy customers new (undeveloped) products which saved the revenue stream of his company. Saul also managed to raise a huge amount of money even when his investors were bombarded with bad news about client dissatisfaction. Saul, like Kim, was reframed as a Churchill.

Allan is rude; he cannot listen more than a minute before he loses his patience. He knows how to do everyone’s job better than they do. He bullies employees and he makes sexist jokes. His personal assistants last no more than 6 months. Allan, faced with a quickly changing job market place, imported labour from abroad solving “a lack of skills” shortage. He scrapped an IT project which was diverting management attention and focused the company on “3 major wins”, as opposed to 50 small projects. He stabilized the product road map. Allan is also a Churchill like figure.

Of course, some leaders look great even though they are /may not be great. While I despise the Russian aggression and Russian leadership, certainly I do not think that Zalensky is a good leader. He provoked, he teased without a risk analysis, he bet the farm on western support and so on and so forth. And yes, he is a great actor, even better than Reagan. But what about the results? Ukraine is in ruins-no electricity, no water, nada. But Zalensky? He wears a nice green habit, and inspires his people;  even more, he inspires western liberals. His present stature makes Churchill into Mickey Mouse.

What do we really know about leadership?

 

Kim, Saul and Allan are thought to be great leaders.

All over the world, people vote for right wing leaders who give them “meaning” and a “sense of belonging”, not proper governance.

Depressed people used to be dipped in ice water. That was the state of the art cure. In another époque, they were paraded to be shamed out of their depression. Now it’s all about serotonin. And ketamine. What do we really know about depression?

Or leadership. Very little.

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Working remote and “do me a favour”

Horrid bureacracies with their rigid processes that cannot factor in common sense often have several workarounds, aka shortcuts.

Managers often allow breaking the rules (that they themselves are asked to enforce); furthermore people in the trenches do each other favours, especially in cultures where relationships are more valued that process. China, Israel, Holland and Taiwan  serve as  good examples.

Noam has been called to the campus at 2 AM to repair an extremely complex valve. He arrives at the campus without his security card, which is in his wife’s car! The gate does not open. He honks furiously. The guard who does not know Noam refuses to open the gate. But Noam knows the other guard sitting in the control room, because they have often had supper together when Noam does the night shift. Noam calls his friend in the control room who lets him in, against every single security policy.

Things like this happen every single day, greasing the idiocy that bureaucracy creates. But not when people work remote: I have not measured that, but I have worked extensively with organizations in which remote workers refuse to bend rules for people that they do not know, and wfh has created lots of opportunities to hide  common sense in a rule book or create buck-passing.

Any organization that wants to promote wfh, which is a very positive thing, need to promote “common sense” that stems from the power of relationships.

 

 

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