You may be king in your house and behave as you please, but once you step into the workplace where you are not the boss, you know you have got to comport yourself in accordance with a different set of rules. No matter the values you hold and espouse as a person, you know that in the workplace you have got to align or subordinate them to the code that operates in the work environment. ‘Set of rules,’ ‘values’ and ‘code that operates in the work environment’ may be seen as components of what is commonly referred to as corporate culture.
Corporate culture, if we may proceed with some definitions, is, according to Edgar Schein, cited by John L. Thompson in his book Strategic Management, defined as ‘the deeper level of basic assumptions and beliefs that are shared by members of an organisation, that operate unconsciously, and that define in a basic “taken for granted” fashion an organisation’s view of itself and its environment.’ He says further that culture is ‘a pattern of basic assumptions that work well enough to be considered valid, and therefore is taught to new (organisation) members as the correct way to perceive, think and feel in relation to problems of external adaptation and internal integration. … (it is) learned, evolves with new experiences, and can be changed if one understands the dynamics of the learning process.’
Thompson’s own view of corporate culture ‘in the simplest terms’ is that ‘it is the way that organisational members behave and the values that are important to them and it dictates the way that decisions are made, the objectives of the organisation, the type of competitive advantage sought, the organisation structure and systems of management, functional strategies and policies, attitudes towards managing people and information systems.’ Let’s get a few more perspectives on the subject.
‘An organisation’s culture,’ according to Geoffrey Moore, quoted by Mark Morgan, Raymond E. Levitt and William Malek in their book Executing Your Strategy (How to break it down & get it done), ‘can be defined by the kinds of values it cherishes and the kinds of people, activities and achievements it celebrates.’ Mark Morgan et al. contend that ‘culture determines how an organisation sets its priorities, the kinds of questions it asks and the style of leadership it adopts. It encompasses the prevailing way of organising work and the type of people the organisation attracts.’ They add further that ‘culture encompasses the implicit and explicit informal norms about appropriate behaviour in an organisation.’
Lastly, according to www.1000ventures.com/businessguide, corporate culture ‘generally represents the norms, assumptions, shared values and artefacts within a firm.’ These artefacts of corporate culture, according to Mark Morgan et al. in their aforementioned book, include: processes, language, rituals, stories, physical environment, etc. In summary, corporate culture is the overarching mores, traditions, ethos, values, customs, beliefs, philosophies, assumptions, expectations, policies, etc. underlying the general behaviour and attitudes within an organisation as well as the general behaviour and attitudes themselves. It is probably nearly, if not equally, as powerful as native culture in imposing a mentality and world view on staff within the organisation. This is understandably the case these days as people tend to spend more time at work (or working) than anywhere else or doing anything else. An organisation’s culture defines the way of life and work in the organisation and is critical for its success.
Sir Allen Sheppard, former chairman of Grand Metropolitan Plc (now Diageo) points to the connection between an organisation’s culture and its success when he says, ‘the power of “corporate culture” should not be underestimated, both for a company’s success and, if it is inappropriate, in frustrating change. Values, strategies, systems, organisations and accountabilities – the components of culture – are a very strong mix which can either make a company successful or, alternatively, lead to its decline.’ He adds that ‘the task of corporate leadership is to apply energy and judgement to the corporate culture to ensure its relevance.’
Going by the various definitions above it shouldn’t be too difficult to see that some organisations in this part of the globe don’t have any deliberately instituted or laid down corporate culture but a system in which just about anything goes. The fact that anything goes does not mean that there is no corporate culture in operation. There is one unwittingly created, and it is underpinned by the ‘basic assumption’ that just about anything goes. It is that assumption that informs the anyhow manner employees conduct themselves and management makes its decisions. Well, that is not our focus for today. The point being made is that all organisations have one form of corporate culture or another, even if only in its crudest manifestation.
If in the course of your career you have worked in a number of organisations, chances are that you are familiar with a couple of distinct corporate cultures. Even if two of the organisations are in the same industry, or the proprietors of one of the two organisations had earlier worked in the other or had moved from one organisation to set up the other, it is difficult if not impossible to have the same corporate culture operating in both. No matter how similar, no two separate organisations can have the same corporate culture. There are bound to be differences, even if mere nuances in some areas.
This point underlies a fundamental issue about corporate culture which may seem a truism but is nonetheless worthwhile restating because it is sometimes lost on some corporate executives. Corporate culture is created and operated by people, not machines. And because no two people are the same, no two non-mechanical systems created and operated by two different people or sets of people will be the same in all respects, even if one copied the other carefully.
No matter how well one copies the tangible attributes or physical features of a system, one is unlikely to achieve the same success rate in copying the inner values and attitudes or intangible attributes underlying the system. Like McDonald’s would argue, ‘Our competitors can copy many of our secrets, but they cannot duplicate our pride, our enthusiasm and our dedication for this business.’ The fact remains that even if the originator of a system shares with her protégé or progeny her inner values, motivations and drive, and possibly spends all her life with the latter to ensure ‘comprehensive’ transfer of values and personality, the protégé will still be incapable of embracing all the values to the exact degree or proportion they are borne in the progenitor.
The fundamental difference between people accounts for the fundamental difference between corporate cultures of different organisations. Man’s uniqueness is so striking that even conjoined (Siamese) twins have different tastes, likes, feelings, attitudes and personalities. Even if two similar organisations are set up and run individually by two identical twins, their different personalities are likely to reflect in how the organisations are run, leading to distinct corporate cultures. Some organisations, however, especially longstanding multinational companies have built their corporate culture over decades and are able to maintain a somewhat uniform culture across all the diverse countries where they have offices. Somewhat because slight differences still exist on account of the differences in the larger operating environment, the local native culture and the people. It is humans and not machines that operate the system after all.
Corporate culture, as noted above, is created and operated by people. Like native culture, it is created, operated and maintained by people for people, not the other way round. People were not created or employed for corporate culture. Corporate culture is not meant to operate as some kind of workers’ overlord standing by with a big stick to punish any non-compliance. It is meant to operate subliminally or unconsciously as Schein noted above. It is meant to create the right atmosphere in the workplace that facilitates great work and promotes smooth working relationship between people, not create stumbling blocks.
It follows therefore that a good corporate culture should promote those things that make for a great work environment. It should therefore be built on positive values such as mutual respect, fairness, teamwork, courage, openness, honesty, hard work, humanity and unflinching commitment to professional ethics. Not on fear, intimidation, favouritism, nepotism, tribalism, religious affiliation (except where it is a religious organisation), discrimination, gender (except if a gender-based organisation), greed or corruption. Also a good corporate culture should not be ambivalent, leaving workers confused as to which course of action to pursue when faced with a difficult decision.
Corporate culture remains relevant for as long as it serves the organisational vision, mission and corporate objectives. It should be known what objectives it seeks to serve, for example, what outcomes or values the culture is meant to promote. There should be a built-in system of sanctions and rewards in a good corporate culture. Let everyone know what the organisation will commend and what it will frown upon and not condone. And just as organisational vision, mission and objectives undergo long-term reviews, every corporate culture should be subjected to periodic reviews.
Thompson argues that there can never be ‘one best or ideal culture’ and that ‘(corporate) culture needs to be flexible and adaptive as circumstances change.’ He maintains that ‘the cultural factors that bring initial success may need to be changed if success is to be sustained.’ ‘Similarly,’ he continues, ‘it is not enough simply to look at what other successful organisations are doing and copy them. Benchmarking and teasing out good practices is both important and beneficial, but these practices again need customising and adapting to the unique circumstances facing an individual organisation.’
In these days of high job mobility, corporate executives have a huge responsibility to ensure that all their new staff are properly oriented and toe the line based on the company’s corporate culture expectation. No one should be allowed to import a different culture or create a new one because she does not seem to like the existing one. Every new member of staff must be given proper orientation on the organisation’s culture before she commences work. The orientation should be seen as a fundamental part of her job description, which cannot be skipped.
Now we come to the crux of the matter. Imagine a situation in a home in which a domestic servant has two bosses (man and wife) who always give conflicting orders, seek to undermine each other and are ever fighting themselves or antagonistic to each other. Put yourself in the servant’s shoes. Do you feel her sense of utter confusion? Now imagine that scenario in the workplace. For the worker, it can be both utter confusion and utter frustration!
A situation in which corporate executives preach one thing but practise another or do not maintain a consistent corporate policy and a consistent position on issues is, to the worker, akin to serving two masters – Dr. Jekyll and Hyde. It sends a confusing message to any conscientious worker who wants to do her job to the best of her ability and demonstrate unquestionable loyalty to the organisation. No organisation is advanced when its management team members undermine or contradict its corporate culture rather than reinforce it.
It is the same confusing situation that confronts the worker where there exist factions headed by different corporate executives who expect workers and managers to be on their side if they want to get ahead. Factionalised management signals a situation akin to workers having two or more masters and creates room for double or divided loyalties. It does not help an organisation’s corporate culture when there is no strong, competent, united and unambiguous management in place with a clear overall boss to whom ultimate loyalty goes.
It is doubtful if any organisation where its workers are consistently faced with ‘serving-two-masters’ situations will make substantial progress. Doom rather than boom is beckoning to the organisation. Only a deliberate and resolute attempt by the management or proprietors of the organisation to immediately address the situation, especially the root cause(s) can save the organisation from going the way of defunct organisations that were brought down by prolonged and repeated failures to deal with endemic ‘serving-two-masters’ situations confronting their workers.
Corporate executives need to realise that their actions speak louder than words. They have a responsibility to model the very norms, values and practices that they espouse. Their workers would feel more at ease in their work if they are able to take decisions when faced with a difficult and conflicting situation by asking ‘what would the boss do?’ rather than ‘what does the boss say?’ This is because, as Mark Morgan et al. argue, what company executives do affect culture more than what they say. They illustrate this with a story about Citigroup.
Citigroup is one of the most decentralised financial institutions in the world. It has experienced a number of ethical lapses in the business practices of its various business units… Following several such widely reported incidents, the company invested substantial resources in creating a set of executive education programme to develop a strong culture of commitment to ethical and legal work practices. At the same time, Citigroup managers, like their counterparts in other financial services companies, continue to be evaluated heavily in terms of short-term financial metrics. So a tension remains between the espoused culture of ethical behaviour and the formal structure (which defines the rules about performance metrics for employees and the rewards tied to them)…
This tension between espoused corporate values and executive actions led to yet another scandal for Citigroup in 2004, code-named the ‘Dr. Evil’ trade. Citigroup (then) CEO Chuck Prince had given multiple speeches to his employees about how important it was for Citigroup traders to follow scrupulously ethical business practices, and he had made significant investments in ethics training for all employees. Yet the perpetrators of the Dr. Evil trade were not disciplined. Understandably, this caused many Citigroup employees … to be confused about the firm’s core values.
The existence of an ‘espoused culture of ethical behaviour’ alongside an opposing system of evaluation that in the main undermines ethical behaviour within Citigroup created the unpleasant ‘serving-two-masters’ situation for its employees. That is not the kind of scenario that conscientious professionals would want to spend their entire working life confronting. Citigroup as one of the Fortune 500 companies admired and respected by start-ups and emerging entrepreneurs across the world, ought to set better examples. Being one of the global giants affected by the recent global financial crisis, Citigroup’s bad example demonstrates the connection between the leading cause of the crisis, said to be the failure of corporate governance and corporate executives’ greed, and the debasement and despoliation of previously-sound corporate cultures and structures of financial institutions.
Thompson underlines this point when he argues that ‘because ethical standards and beliefs are aspects of the corporate culture, they are influenced markedly by the lead set by the strategic leader and … her awareness of behaviour throughout the organisation. If a proper lead is not provided, managers will be left to “second guess” what would be seen as appropriate behaviour.’ He cites WC Frederick as contending that ‘the corporate culture is the main source of any ethical problems.’
Regulators of Nigeria’s financial industry might want to turn the searchlight on the existing corporate culture in banks and other financial institutions. That is where any meaningful fixing of the ethical problems bedevilling Nigeria’s financial sector should begin. Also, corporate executives in financial institutions and other corporate organisations need to critically examine their corporate culture for signs and manifestations of the ‘serving-two-masters’ situations they may have unwittingly created for their employees. The prize for eliminating the problem – which includes attraction and retention of the best hands in one’s industry and a highly efficient, effective and successful organisation – will be well worth the effort.