Thursday, June 19, 2008
Scott Olson of Ann Arbor SPARK recently recommended to me Keith McFarland’s book “The Breakthrough Company.” Using a similar research methodology as Jim Collins’ “Good to Great,” McFarland wanted to find the answers to the following questions:
- Why do most companies start small and stay that way?
- What is special about the handful of companies that successfully “break through” the entrepreneurial stage of development?
- What can a leader do to ensure that his company maximizes its chances for breakthrough?
Overall, I found the results of his research interesting and the time to read the book worthwhile (probably the biggest test of utility these days). Where I have some significant disagreements is with his chapter entitled “Building Company Character.” Being a self-professed culture guy, I was eager to hear what he had to say. Unfortunately, I think his insights don’t add up. Here’s why. This is his defining statement regarding the difference between corporate culture and character.
Some may wonder why we use the term “character” instead of “corporate culture” – it seems to us that the idea of a corporate culture brings with it too much baggage. Borrowing the term from the field of anthropology, many business observers have given the impression that culture is something largely beyond the control of individuals in an organization. Culture is viewed as something out there, to be studied and rectified by consultants. The idea of organizational character is different. Since character measures how we are as a group of individuals act, we are reminded that each of us has an individual responsibility for determining our company’s character. This point was driven home to us when, during our fieldwork, one executive told us, “There is no such thing as corporate culture, there is only how we treat each other.”
Putting aside the minor slam on consultants, here’s my beef. Just because culture is hard to get your arms around doesn’t mean it’s not relevant -- probably more so. Another thing, I don’t know who Mr. McFarland is talking with, but plenty of work has been done to measure the characteristics of corporate culture and link it to bottom-line results. For me, culture is all about behavior, specifically, patterns of behavior that are expressed in the absence of explicit expectations or that contradict explicit expectations or values. So it’s not just about how people act, it’s also about the way people behave that contradicts what the company espouses as its values or character, as well as what they say or don’t say depending on particular circumstances.
And then McFarland seems to contradict himself. Twelve pages later he is describing a case study featuring Shamrock Foods of Phoenix, Arizona:
A quick survey in early 2007 of the top thirty-five people in the firm identified one of the problems: People in the firm weren’t saying what they really thought. Perhaps owing partly to history (Shamrock is a 100-year old firm still owned by the founding family), people at Shamrock are nice, sometimes too nice. And in the interest of niceness, sometimes people avoided confrontation. It turned out the team didn’t agree as much as thought about what the firm’s key strategic imperatives should be, which caused a lack of focus.
Hello, that is culture! What was causing people not to speak up? Instead of brushing off this behavior as a family-owned business phenomenon (might be a big reason, might not be), McFarland needs some x-ray glasses to see through the actions to the underlying behavior and even further to the reasons behind these behaviors. This is the messy digging up process of an organizational anthropologist, Mr. McFarland. You might want to hang out with us for a while.
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