DECIPHERING, CHANGING AND LEADERSHIP - ORGANIZATIONAL CULTURE AND LEADERSHIP: LESSONS FROM STAR

CULTURE

How Leaders Embed and Transmit Culture

As the organizational culture is the shared learning by the group and eventually it will be dropped out of awareness after learning the same things over and over.

Founders and leaders are the linchpin of the learning process as they have credit to impose their own view, have power to make decision, etc. We have seen many organizations in big or small size are the reflection of what are their founders’

assumptions and beliefs. Apple is the apparent case that all of its products have reflected what Steve Jobs beliefs: product oriented, perfectionism, minimalism and superior of design over engineering, etc. (Isaacson, 2011). Apple’s products come out with sexy look, minimal interfaces and buttons (Macbook laptop has onle 2 USB-C ports while other brand laptop has as many ports as possible, USB, VGA, Ethernet…). Apple has always been pioneer to cease the unnecessary accessories for the product such as the first to dropped out Floppy Disk and CD-ROM. We even don’t feel any redundant accessories from Apple’s product. The IPhone 4’s incidence about the loss of telecom signal when the user holds the phone in particular manner showed us evidence of Apple’s culture of triumph of design over engineering. Ive, Chief of Design, suggested the design of IPhone 4 with the glass’s surface. And to make it as “unibody” and elegant look, he suggested to remove the sizable slot filled with plastic that hidden antenna can receive telecom signal. The engineer resisted this idea and warned that the signal of the phone will not be stable. But obsessed with the sleek design, Jobs decided to implement Ive’s idea, and result was the crisis that Apple offered the cover or accepted any product return from its customers. History and presence of Apple show us that the culture that being embedded by the founder is actually prevailed over time and even is the resistance force to new leader with different view. Evidence by John Sculley who replaced Jobs in 1983 with the beliefs in marketing and profit more than great product was ousted by

failure in managing company go on right track, and then Jobs came back to revive Apple back to its original culture, and until now, over 6 years from Jobs’ last breath, Apple has been still pursuing literally same culture at Jobs’ time. (Isaacson, 2011).

To understand the organizational culture, it is crucial to understand how (or through what means or tools) the founder or leader reinforce, embed and transmit the culture to organization. Schein organized them into primary and secondary mechanism listed below:

Table 3.1. How Leaders Embed their beliefs, Values, and Assumptions. Adapted from

Primary Embedding Mechanism

Schein wrote (Schein, 2016, p.184):

The most powerful mechanisms that founders, leaders, managers, and parents have available for communicating what they believe in or care about is what they systematically pay attention to. This can mean anything from what they notice and comment on to what they measure, control, reward, and in other ways deal with systematically. Even casual remarks and questions that are consistently geared to a certain area can be as potent as formal control mechanisms and measurements.

In managerial accounting, there is famous quote about the effectiveness of managerial accounting that “we get what we measure”, meaning that people tend to concentrate to improve what numbers on accounting report rather than other numbers

not being measured. So for the culture “Culture we have is what leader pay attention, control and measure”. If the leaders are aware of this powerful mechanism, they can consciously impose what they really want the culture looks like over daily operation, more importantly in consistent way. In case these things are not done consistently over time, it will cause great trouble and time consuming for their subordinates whom are confused and spend time to guess the real message from their leaders. At his famous quote, Warren Buffett said “Somebody once said that in looking for people to hire, you look for three qualities: integrity, intelligence, and energy. And if you don’t have the first, the other two will kill you. You think about it; it’s true. If you hire somebody without [integrity], you really want them to be dumb and lazy.”. It’s true here that the integrity (consistency) of leader is eventually the integrity of the organization.

The moment that reinforces the perception and behavior of subordinates greatly is the emotional outburst of leaders. As human nature, people don’t want and carefully avoid to face such painful situation from intense emotions, and the memory of such panic will last longer than in normal situation. Next time, subordinate had learned and know what condition their leaders would be critical and would act accordingly to avoid it happen again. Ironic case had been recorded in Apple from some first years after inception, that Jobs was very emotional in the meeting, his well-known ability of

“reality distortion field” (his unblinking staring look and charisma could distort the reality and persuade people to do what he wants them to do although they know it is impossible). Jobs could praise any one for brilliant idea by that time then some hours later call it crap, or berate an engineer for the bad idea then praise him after an hour. To survive over, Jobs’s subordinates developed the ability to filter out or reduce the fluctuation or the rhythm of Jobs’s emotion, then creating a climate that it is not much intense whereas outsiders (never met Jobs before) feel a horrible meeting with Jobs’s behavior. (Isaacson, 2011).

So how about what leaders do not pay attention to, subordinates would infer either it is not the thing they should focus or they can do it in their own choices. This is the area that kind of subculture will be developed because each of leader’s subordinate will have different assumption and will impose their own assumption over their underneath hierarchy.

The culture of organization or the assumption of leader will be challenged the most in the case of crisis. The crisis is the chance of people see how strong the assumption of that leader is. Because in normal situation, leaders might consciously act

on rational thinking, as his espoused beliefs and values, only in critical crisis that leader would use what is really essential to them to react. So crises are especially significant in culture creation and transmission through reacting to and solving crises from leaders.

More successfully leader solved the crisis, stronger impact of culture creating and embedding is, as people more likely believe the reaction of heightened emotion in crisis rather than in normal circumstances.

For the role of modeling, recruiting, promoting, excommunicating, … from leaders. I would like to illustrate it by using Chinese traditional wisdoms. Once said in the book of “Great Learning” or “Daxue”, one of four favorite books of Confucianism (Lee, “The Great Learning” translation, 8.1):

“8.1 所謂平天下在治其國者：上老老而民興孝，上長長而民興弟，上恤 孤而民不倍，是以君子有絜矩之道也。所惡於上，毋以使下；所惡於下，

毋以事上；所惡於前，毋以先後；所惡於後，毋以從前；所惡於右，毋以交於左；所惡於左，毋以交於右。此之謂絜矩之道。《詩》云：「樂只君子，民之父母。」民之所好好之，民之所惡惡之，此之謂民之父母。

《詩》云：「節彼南山，維石巖巖。赫赫師尹，民具爾瞻。」有國者不可以不慎，辟則為天下戮矣。”.

“It was said that “To promote good virtue throughout the world must first govern their nations effectively”, if the leader is filial to his own parents and grandparents, his people naturally would become filial to their parents; if the leader respect his elders, his people naturally would respect their elders; if the leader shows compassion towards the deprived, his people would naturally not act contrary to humanity. Thus the leader set the example and standards for Code of Self‐conducts.

What I dislikes those above me do, I would not do so to those below me; what I dislikes those below me do, I would not do so to those above me; what I dislikes those before me do, I would not do so to those after me; what I dislikes those after me do, I would not do so to those before me; what I dislikes those on my right do, I would not do so to those on my left; what I dislikes those on my left do, I would not do so to those on my right; this is so call The Code of Self‐conducts…”

This timeless wisdom is not exceptional by today, even is proved to be more true, because whatever vocal message the leader wants to communicate, his modeling is the most forceful, persuasive and overriding message. Another ancient story about how the leader was aware of his role model before communicating a message: once upon the time, a mother approached Mahatma Gandhi (2 October 1869 – 30 January

1948) respectfully and asked if he could advise her boy to stop eating so much sugar.

Gandhi paused a moment and told her son go home and come back in two weeks. Two weeks later they came back, Gandhi looked at the son and said “Boy, you should stop eating sugar. It is not good for your health”. In her surprise, the mother asked Gandhi why he did not tell the boy two weeks ago. Gandhi replied “Mother, two weeks ago I was still eating sugar myself”.

In the Analects of Confucius, chapter Wei zheng 爲政 (Muller, 2017 updated, 2:19): “The Duke of Ai asked: “How can I make the people follow me?” Confucius replied: “Advance the upright and set aside the crooked, and the people will follow you.

Advance the crooked and set aside the upright, and the people will not follow you.””.

By promoting and excommunicating his subordinates, leader sends a covert important message to the people about how he would appreciate and dis-appreciate his followers.

By doing this, leader eventually create a fast and smooth learning because people followed the leader should have relevant assumption to be promoted, then a climate of the organization would align with his assumptions. They way leader punish and reward his subordinates also have the same effect as promotion and excommunication.

Besides replicating their assumptions, leaders also promote outsiders to bring new culture into organization, because it is not easy to change the deep assumption of people, and there won’t be an example to learn from, the more powerful and faster way is to promote an outsider who is ingrained with the culture and skills needed by the leader.

Secondary Reinforcement and Stabilizing Mechanisms

In the organization, those design, structure, architecture, rituals, stories, and formal statements are greatly instilled by founders and leaders at the early stage and even at the mature stage of the development of organization, just like the house we build, the important and essential first design and structure are realized by our conceptions. Then after the house is built and we move in, like after organization succeed and stabilize, these space, design, shape become the constraint to be changed and the change tends to be small and incremental though. Like our house, when the organization become stable, these secondary mechanisms have already been setup, leaders will face the constraint in changing any of it. In some situation, the culture associated with these setup mechanisms literally define whose assumption aligns with

25 its culture could become the leader.

Schein wrote (Schein, 2016, p.198):

All these secondary mechanisms can be thought of as cultural artifacts that are highly visible but may be difficult to interpret without insider knowledge obtained from observing leaders’ actual behaviors. When an organization is in its developmental phase, the driving and controlling assumptions will always be manifested first and most clearly in what the leaders demonstrate through their own behavior, not in what is written down or inferred from visible designs, procedures, rituals, stories, and published philosophies”.

For the integrity of the culture, the second mechanisms should be congruent with the primary mechanisms for the best result of culture embedding and transmitting.

But in case the secondary mechanisms are different from primary mechanisms, the implication of leaders would take more effect, as we usually witness in our job that sometimes staffs would say it is the procedure to do this, then their leader can supersede the procedure by commanding to ignore the procedure and “do it my way”. Later “do it my way” becomes the new procedure.

As we can see any “way of doing, thinking…” initiated from the founder or leader, it will eventually become an atom of the culture which then is embedded and transmitted within organization. No matter how explicitly intended or not, leaders or founders are actually creating and managing their organizational culture. Someone may ask so then in any way, culture is there, why do leaders bother to beware of and manage organizational culture? To answer, I would like to cite the Chinese ancient story about one of great thinkers of the East, Mencius (孟子 or 孟轲). The story was called

“Mencius's mother, three moves” (孟母三遷). (Visiontimes, 2017):

Mencius's father died when he was very young. His mother Zhǎng (仉) raised her son alone. They were very poor. At first they lived by a cemetery, where the mother found her son imitating the paid mourners in funeral processions. Therefore, the mother decided to move. The next house was near a market in the town. There the boy began to imitate the cries of merchants (merchants were despised in early China). So the mother moved to a house next to a school. Inspired by the scholars and students, Mencius began to study. His mother decided to remain, and Mencius became a scholar.

Leaders of an organization are like the mother and organization is like her boy in this story. The intention of the mother to have her son to become scholar is like the vision of the organization. The third place the mother moved to is the right culture of

the organization to reach its ultimate vision. If Mencius’s mother was not aware of the environment and deliberately moved Mencius to the proper environment, probably we would not have an influential thinker and the author of one of Four Books (四書). The same lesson rings true for us today, if leaders don’t beware, understand and deliberately cultivate the organizational culture, will organizational vision be attained?

To maintain proper organizational culture, leaders need to understand their current culture first, then filing the perceived gap by the proactive change. Following sections will deal with how to deciphering and changing the culture.

Deciphering The Organizational Culture

The organizational culture is complex and includes many aspects of the organization, so to deciphering an organizational culture is not an easy job, especially it is almost impossible to have a complete picture of it. In my opinion, deciphering a culture is to try to capture as complete as possible the aspects of the culture. From the prevailing practice of researchers, we have two methods to decipher the organizational culture, qualitative and quantitative methods, and each of method has its own pros and cons. Let’s look at the field of anthropology to know how anthropologist explore the new culture (this field is also the foundation of “organizational culture” term to be born, in fact the “Artifacts” word was originated from this field). Geert, anthropologist, in order to pursue new ways of obtaining insight of the native mind and understanding the world, in his paper (Geert, 1983) introduces two concepts “experience near” and

“experience far”. The first concept refers to the native’s thoughts, feelings, views and beliefs, the latter refers to the terms and formal description of the phenomena. Or we can call first concept as “walking around” and the latter as “bird’s-eye view”. These two concepts are relevant to qualitative and quantitative methods as we usually see by today.

To discover all of aspects and deeper structure of organizational culture, the bird’s eye view or quantitative method could give us the aspects and type of organizational, and “walking around” or qualitative method could help us to delve into a deeper layers of the culture such as basic assumption and in-used and espoused belief and values. So the combination of two methods give us deeper and more complete picture of organizational culture than using one method alone. Following sections, I will describe both methods in general.

Quantitative Method or Bird’s eye view

Usually this method involves the employee’s survey with specific given questions. To know what kind of questions we need to ask, we need to have in advance some particular typologies of the organizational culture, then answers will be calculated by pre-defined formula and guidance to output the result as the profile (what typology our organizational culture is similar to). There are several models (or kind of profiles) are popular as following (Schein, 2016, p.285-293):

- Denison (1990)’s model identifies a number of dimensions of culture that are presumed to be relevant to a given organizational outcome such as performance, growth, innovation, or learning. The survey questions are then focused on just the dimensions considered relevant, and if those dimensions cannot conveniently be measured with a survey, the researcher or consultant can supplement with interviews and observations. Here is example of 12 dimensions under four general categories: Mission (strategic direction and intent, goals and objectives, vision), Consistency (core values, agreement, coordination and integration), Involvement (empowerment, team orientation, capability development), Adaptability (creating change, customer focus, organizational learning). Scores on each of the 12 dimensions are shown in a circular profile of the group and can be compared to norms based on a large sample of organizations that have been rated as more or less effective. Notice that the categories are quite abstract, so we have to go back to the actual items to discover just what was meant by each dimension.

- Human Synergistics International (HSI) offers a similar approach with its

“organizational culture inventory” (Cooke & Szumal, 1993). HSI’s 12 dimensions, also shown as a “circumplex” profile, are organized around three basic organizational styles: constructive styles (achievement, self-actualizing, humanistic-encouraging, affiliative), aggressive-defensive styles (oppositional, power, competitive, perfectionistic), passive-defensive styles (avoidance, dependent, conventional, approval).

- The O’Reilly, Chatman, and Caldwell (1991) “organizational culture profile”

(OCP) offers another alternative. The OCP distinguishes attributes associated

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