The Corporate Culture Handbook: How to Plan, Implement, And Measure a Successful Change Programme
From BookJive
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| Author: | Gabrielle O'Donovan |
| Publisher: | Liffey Press |
| Published: | |
| Pages: | 375 |
| ISBN-10: | 1905785291 |
| Category: | Array |
[edit] Book Summary
[edit] Preface
One of the greatest issues facing companies in the new century and the latter part of the last century has been that of corporate culture management. The importance of corporate culture has been keenly felt by many in light of recent corporate governance scandals. Many companies have opted to move away from traditional piecemeal solutions to a more holistic and global solutions which addresses corporate culture issues on a much higher level.
Corporate Culture: The Rites and Rituals of Corporate Life was one of the first books on the subject, which was later followed by the research of Kotter and Heskett--two Harvard professors. The professors conducted an 11 year study which determined that companies with a strong culture of ethics significantly outperformed companies with weaker cultures. In spite of all the current research available there was no real resource that addressed the design and implementation of a corporate culture change strategy based on primary research. That is where this book comes into play.
Author Background O'Donovan graduated from the University of Bolton UK and was hired by Rabone Chesterman of Birminghan UK where she help to place staff members in new employment as the company was closing under a national recession and economic pressures. Later, O'Donovan moved to Hong Kong where the economy was booming and she started a training consulting company. After a few years O'Donovan joined the Cathay Pacific Airways team where she worked on the service culture change program among other things. She also began her graduate work during her 6+ years with Cathay Pacific. In 1999, and as a result of routine medical surgery, O'Donovan suffered near fatal pulmonary embolism and cardiac arrest. During the recovery period she finished her Masters thesis and reflected on her life. The event had a profound effect on O'Donovan's outlook and left her very focused. Shortly after the incident O'Donovan joined HSBC Hong Kong where she designed and implemented the award winning "Together! We Win!" (aka "Chung Chi Sing Sing") corporate change program for the bank plus five subsidiary companies.
Part I of the book presents:
- An overview of a major company using a corporate management change program
- Cases for and against corporate culture management
- How the current model setup recent corporate scandals.
- Consider some of the myths surrounding corporate culture
Part II show leaders how they can implement a successful change program.
[edit] Part I Practice into Theory
[edit] Chapter 1 HSBC and the New Millennium
Background Chapter 1 outlines the award winning culture transformation program led by the author for HSBC and 5 subsidiary companies. The Hong Kong and Shanghai Banking Corporation, started in 1865, is the second largest financial institution in the world with over 10,000 offices. The vision of the transformation program was to "embrace change to allow HSBC continuing success in the 21st century" and the mission was three fold: build staff satisfaction, customer satisfaction, and shareholder value. Phase I of the program lasted for 7 months and took the form of a centeralized event. Each day 120 participants would gather to learn how the 6 core values of company were being practiced on a departmental level. There were small group workshops that included a mix of employees including top management. Also, a live question and answer forum was held where employees were encouraged to ask top management speakers for responses to current issues. Phase 2 followed and took place over an 18 month period; in their workplaces, teams reviewed specially designed learning materials and used action planning and implementation to transfer the company's core values to their everyday work.
The program had a significant impact on the company's culture. An employee survey was taken before and after the program and the results were impressive.
- Company Image +15%
- Quality of Supervision +14%
- Empowerment 14%
- Customer Focus 14%
- Working Relationships +12%
- Quality +10%
The program also went on to win several prestigious awards, including the ASTD Excellence in Practice award (USA) and the "Customer Service Grand Award" (Hong Kong), which was won for the first time in the company's history.
[edit] Chapter 2 Corporate Culture Defined
[edit] Chapter 3 The Business Case
"...corporate culture is a potentially productive or destructive force."
Case Study: Enron Enron management used off-the-books private partnerships to cloak inflated earning reports and were eventually caught. In November 2001 the company disclosed their overstatement of profits and by December of the same year the company filed for bankruptcy.
Case Study: Arthur Andersen Arthur Anderson created a company culture by creating a cookie-cutter workforce designed to maximize profits and who were unable to think for themselves. In order to make millions the company overlooked their client's (WorldCom,Enron) book cooking practices.
Case Study: Parmalat "Parmalat [Italian dairy giant] executives simply invented assets to make up for as much as $16.2 billion in liabilities and falsified accounts. Its 2003 Earnings before Interest, Taxes and Depreciation were overstated by 530 per cent." The company claimed to have a Bank of America Cayman Islands account. The company went bankrupt in December of 2003.
Case Study: WorldCom WorldCom had a $7.2 billion dollar accounting discrepancy that later led to the biggest bankruptcy scandal in history.
According to a ISR (International Survey Research) study toxic company cultures can be identified by the following:
- Company values discussions are more lip-service than a true commitment
- Integrity is seen and a hindrance
- Debate and challenging status quo is discouraged
- Bad news is spun instead of dealt with
- Information is not shared openly
- Behavior of high-performance employees is never questioned
- External factors are manipulated, rather than respected
- Exclusive focus on short term financial growth
Another study conducted by GlobeSpan found that 70 percent of consumers hold companies totally responsible for operational responsibilities (provide secure and safe work environment, eliminate harassment and discrimination, reject the use of bribery, etc) while only 50 percent of consumers would hold companies responsible for citizen responsibilities (protect human rights, protecting the environment, making contributions to charities, etc).
Each company has a unique corporate culture which cannot be copied by other companies, unlike products and services. This differentiation can significantly enhance a company's competitive edge.
Mergers and acquisitions are most likely to fail because of differences between company cultures. Besides the regular due diligence companies should conduct due diligence on the merging company cultures to identify any incompatibilities that need to be resolved.
Research by Harvard Business School professors Kotter and Heskett that studied 207 large firms for a span of 11 years found that companies with exceptional company cultures outperformed the competition by significant margins. The former:
- Increase revenues and average of 682 percent compared with 166 percent
- Expanded their workforces by 282 percent compared with 36 percent
- Grew their stocks by 901 percent versus 74 percent
- Improved their net incomes 756 percent versus 1 percent
Several academic arguments against conducting a corporate culture change program include:
- It challenges a worldview and causes stress and confusion - This may be true, however, in challenging the status quo we stretch our comfort zone and become more empowered.
- Corporate culture can't be measured - ways to measure corporate culture are constantly evolving and have become more accurate. More on this later in the book.
- It's too expensive - This is not true. There is an initial cost associated with a program, but "Typically, the financial outputs (increased revenues and cost savings) come to exceed the inputs by a wide margin.
[edit] Chapter 4 Culture Myth Exploded
[edit] Part II Theory into Practice
[edit] Chapter 5 Back to the Drawing Board
[edit] Chapter 6 From the Strategic Management Team
[edit] Chapter 7 Create Program Vision and Define Strategy
[edit] Chapter 8 Organize the Workforce
[edit] Chapter 9 Design Core Program and Embedding Mechanism
[edit] Chapter 10 Communicate Vision and Program Roll-Out
[edit] Chapter 11 Manage the Human Landscape
Managing the human landscape effectively during the changes brought on by the culture change program can make the difference between success and failure. This chapter addresses how cultural changes will affect employees differently and how to deal with this. In response to the challenge of change soem 10% will immediately embrace the changes (Champions), 80% will resist the change (Resistors) and the remaining 80% will have a mixed response (Laggards).
The company should reveal the news of change timely, and thoughtfully, and through key leaders who are prepared and confident in immediately fielding any questions that should arise. A leader's confidence will calm and comfort the staff. Also, make sure that line-managers are ready to answer questions because their staff will look to them for guidance as the news is announced and throughout the change process.
The workforce will need company support and company provided tools to help champion a successful change program. It is not enough to just deliver the message. Leaders need to approve time for meetings, create learning packets that outline, support, and explain new concepts and scenarios. Leaders also need to be sensitive and supportive of the array of emotions the staff will experience. Adapting to a new situation can be difficult for some people so encouraging appropriate emotionally processing is highly recommended.
Champions (those who are optimistic and supportive from the start) may experience a relapse in their commitment as the program progresses. It is important that leaders support and help these people resolve their issues as they arise.
Laggards and Resistors can be swayed and become ardent supporters if they are given support. "Once the individual starts to have a few wins with their new situation, this can help them to be more honest with themselves about the past, let go of the obsolete and commit to the future." It should be noted that there are two types of resistors 1. those that are genuine in their concern or fearful of the change (this can be overcome through counselling and education) and 2. those who want to undermine the program to preserve some self-serving interest. In order to deal with resistance to change try using one of the following approaches:
- Education and Communication
- Participation and Involvement
- Facilitation and Support
- Negotiation and Agreement
O'Donovan shares a conversion story of one of the HSBC company leaders who, at their first meeting, vehemently opposed the change program. After some effort O'Donovan was able to schedule another meeting with the man and convinced him that they both wanted the same thing, but that it could be accomplished on her budget and time line saving his department money. He went on to become a very dependable leader and supporter of the change program.
