When Crisis Hits Corporate Culture

When Crisis Hits Corporate Culture

Corporate culture, defined as “how we do things around here,” powerfully influences people.

There are four core cultures: control, collaboration, competence, and cultivation. The “competence” culture creates a perception of distinction by offering one-of-a-kind products and services. They pursue excellence and capitalize on high capability. Filled with high achievers, they are highly competitive, and intensely focused on winning.

The power of culture derives from implementation and identity. With success (perceived or real), “how we do things” becomes the equivalent of “who we are” (identity). Now the motivation to keep doing things the same way subtly shifts to a motivation to preserve identity. Culture grows so powerful precisely because it becomes the identity of the firm and its leaders.

Strengths taken to extremes turn into liabilities. When leaders fail to keep behavior in balance, problems emerge. These loom large because they are, in fact, identity problems. Out-of-balance behaviors unique to competence cultures include: mistrust, secrecy, arrogance, fear of making or revealing mistakes, excessive financial incentives, emphasis on winning, refusing to consider odds of losing, selfishness, and ethics that take a back seat to cashing in quickly.

Leaders must monitor their cultures, the strengths and potential liabilities, keeping both in balance and preventing strengths from running to the extreme. Indeed, when an extreme is allowed to “mature,” the company will have a serious problem borne of its strengths but characterized by great weakness.

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Posted in Business and Strategy Management and Leadership

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