I ended 2015 shaking my head about the pervasive misuse and misdiagnosis of cultural issues in organizations.  The head shaking started when I read a December 20th article in the Wall Street Journal about Volkswagen AG’s plan to change organization structure by routinely rotating key executives in order to break a “culture of tolerance” for rule-breaking in the company.  This is being done in the wake of an emissions cheating scandal involving 580,000 diesel-powered vehicles sold in the US with devices that duped emissions tests. The incident has wreaked havoc on the company’s reputation and market value, and threatens it with criminal investigations and fines that could total more than $18 billion.

Then, a mere 10 days later I read another Wall Street Journal article about a company that has launched a “culture on candor” campaign to stop employees being nice all the time and start speaking up about sub-par work.  Other companies mentioned in the article are using practices called “radical candor,” “mokita,” or “front-stabbing” in order to get managers and employees to confront each other about questionable actions and decisions.

My concern is that the companies are fixing the wrong issue under an umbrella of a “culture thing.”  When things go wrong we want to fix the cause of the problem, not its manifestation.  The root cause of employees not speaking up about issues in a company is often two-fold:  (1) the cascading impact of poor leadership behaviors of key executives, and (2) an ineffective performance management system.

Leadership Behaviors of Key Executives

There are three important leadership behaviors involved:

  • •  Integrity: standing for something, having core values and never being ambiguous or neutral about them.  It is a gift we give ourselves, one that is easier to manage than it is to recover when lost.
  • •  Courage: taking action or making a decision in response to a situation.  It comes from a future orientation and an ongoing assessment of the regrets of non-action.
  • •  Intolerance: establishing boundaries of right and wrong for an organization and never accepting violations.  Leaders will get the lowest level of performance in an organization that they are prepared to tolerate.  They signal their level of tolerance through what they do and say, don’t do and say, and the questions they do and don’t ask.

The three behaviors are interrelated.  In seminars and coaching my advice to clients is to focus on integrity first.  Get a good understanding of what you stand for and make sure that there are no gaps in what you espouse and the way you actually show up.  With that foundation, a leader now has the ability to challenge their intolerance through acts of courage.  If there are people and/or situations at work that conflict with their values, then they must confront them in the moment.  It’s the interplay of courage, integrity, and intolerance that builds a leader’s mastery of all three.  “Radical candor,” “mokita,” and “front-stabbing” are excellent and courageous actions provided that they are based on a foundation of integrity and intolerance.

Ineffective Performance Management System

One of my laws of performance management is:  Employees will do whatever you incentivize then to do.  They won’t do anything else even when it’s the right thing to do.  In this regard, there are two concerns that leaders must address in a performance management system.  The first is a about messaging.  The message that employees get about expectations is more important than any other aspect of performance management because it determines behavior.  When erroneous messages are perceived it’s always about the wrong context.  Left in a vacuum without context from management, employees will infer one based on the life experiences that shaped their identity.  Leaders must ensure that context about performance is shared from the top to the bottom of an organization to ensure that employees get the right messages about expectations.

The second concern is about goals or more specifically “goalodicy”.  Unintended consequences can occur when achieving a goal becomes a fixation, i.e., more than just hitting a target but a part of the identity of the organization and the people who work there.  The issue is that when evidence emerges that a goal is unwise, employees will either not observe it or ignore it because their identity is tied up in the goal.  Management must be attentive to the risks of goalodicy and be thoughtful about creating a balance of goals for an organization.  When a singular goal shapes the collective identity of an organization, it will take a crisis or crises to refocus the organization.  We have seen this time and time again and Volkswagen AG’s drive for environmental leadership in diesel engine design may be another example.

Bottom line:  If you want to fix an organization first start with the leadership behaviors of the top executives, and then refresh the performance management system to ensure that the messages are clear and the goals are balanced.  Restructuring and cultural campaigns are often false starts that do nothing more than perpetuate a problem.


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