Managing Change Toolkit

 lindsay sherwin logo

          OverviewDeveloping a Change StrategyImplementing ChangePeople in Change    

Overview
bullet Overall Framework
bullet Best Practice Tips
bullet Managing Radical Change
bullet Culture - Charles Handy
bullet Culture - Deal & Kennedy

© Copyright 2007
Lindsay Sherwin

Click here to access the Lindsay Sherwin Homepage and further toolkits.

Deal and Kennedy's - Corporate Cultures (1982)

Corporate Culture is "the way we do things around here."

The Five Elements

Deal and Kennedy argue that corporate cultures and behaviours are shaped by shared values, beliefs, and assumptions about the way an organization should operate, how rewards should be distributed, the conduct of meetings, even how people should dress. Drawing on approaches from anthropology they identified five critical elements:

  1. The business environment - the orientation of organizations within this environment - for example a focus on sales or concentration on research and development - leads to specific cultural styles.
  2. Values - are at the heart of corporate culture. They are made up of the key beliefs and concepts shared by an organization's employees. Successful managers are clear about these values and their managers publicly reinforce them.
  3. Heroes - personifications of the organization's values, achievers who provide role models for success within the company. (...) Heroes have vision and go against the existing order if necessary in order to achieve that vision.
  4. Rites and rituals - ceremonies and routine behavioural rituals reinforce the culture (product launches, sales conferences, employee birthday celebrations...)
  5. The cultural network - the carrier of stories and gossip which spread information about valued behaviour and 'heroic myths' around the organization.

Analysing these five elements can give an indication of how strong the organisations' corporate culture is.

The Four Cultures

They then proposed a model of culture is based on characterizing different four types of organization, based on how quickly they receive feedback and reward after they have done something and the level of risks that they take.

Feedback and reward
  • A major driver of people in companies and hence their culture is the general feedback and specific rewards that tell them they are doing a good or bad job.
  • If this feedback is immediate or shorter-term, it will quickly correct any ineffective behavior and hence lead to a consistent culture (those who cannot survive will quickly find out and either leave or be sacked).
  • If the feedback takes longer to arrive, then can leave mistakes uncorrected, but it also lets people look further out into the future. Either way, there is likely to be some substitute activity (such as process management) to help keep things on track until actual results are known.
Risk
  • Uncertainty and risk are something that some people hate and some people thrive on. In either case, it is another motivating force that leads people to focus on managing it.
    Where the risk is low, people may be willing to take risks up to their acceptable limit. Where they are high, the risks need to be managed or accepted. High risk companies are more likely to include people who enjoy the frisson of taking a gamble.

 

 

Risk
Low High
Feedback and reward Rapid  

Work-hard,
play-hard
 culture

 

Tough-guy macho
culture
Slow  

Process
 culture
 

 

Bet-the-
company
culture
 

 

Work-hard, play-hard culture
 This has rapid feedback/reward and low risk, leading to:
  • Stress coming from quantity of work rather than uncertainty.
  • High-speed action leading to high-speed recreation.
  • e.g. Restaurants, software companies.
Tough-guy macho culture
 This has rapid feedback/reward and high risk, leading to:
  • Stress coming from high risk and potential loss/gain of reward.
  • Focus on the present rather than the longer-term future.
  • e.g. police, surgeons, sports.
Process culture
 This has slow feedback/reward and low risk, leading to:
  • Low stress, plodding work, comfort and security. Stress may come from internal politics and stupidity of the system.
  • Development of bureaucracies and other ways of maintaining the status quo.
  • Focus on security of the past and of the future.
  • e.g. banks, insurance companies.
Bet-the-company culture
 This has slow feedback/reward and high risk, leading to:
  • Stress coming from high risk and delay before knowing if actions have paid off.
  • The long view is taken, but then much work is put into making sure things happen as planned.
  • e.g. aircraft manufacturers, oil companies.

On Cultural Change

Changing culture can be enormously expensive and take a very long time. It should not be embarked upon unless it is really needed. Deal and Kennedy identified five reasons to justify large-scale cultural change:

  • If your organization has strong values that do not fit a changing environment
  • If the industry is very competitive and moves with lightning speed
  • If your organization is mediocre or worse
  • If your organization is about to join the ranks of the very largest organizations
  • If your organization is small but growing rapidly.