How Leadership Affects Culture and Culture Affects Leadership

How Leadership Affects Culture and Culture Affects Leadership

There has been so much written on leadership that there is very little I can really add. Leaders should be story tellers, communicators, holistic, strategic, encouraging, creative, conservative, risk taking, ethical, competitive, inspiring, and a whole host of other attributes that are too numerous to mention. There are 940 books currently available on the subject and it would not surprise me if you there were close over half a million articles on the subject. It is the bread and butter of every consulting firm throughout the world. With so much thought and insight, why is it still an issue?

The answer lies with culture. The entire purpose of leadership is to create a culture. In a large and well established organization it can be difficult for an outsider to implement a new culture. So, does leadership create a culture or does culture create a leadership? The answer to both questions is yes.

Culture Affecting Leadership

“I have been here 25 years.” said the director of a large municipality. “I have outlasted 3 City Managers so far and I will outlast this one.” That is the attitude that many leaders face, especially when they are brought in from outside organizations to run or manage large, well established ones. The negative cultures especially can undermine positive leadership as initiatives are actively undermined by managers who have a stake in the old culture. Whether it through manipulation or complacency, negative cultures can be create significant challenges for change.

Negative leadership, however, can have a fast, dramatic affect on a positive culture. WorldCom was a telecom leader and very innovative culture until Bernie Ebbers took over. While squeezing every cent he could from the environment and putting pressure on employees to work harder with less, he was pillaging the company. Turnover soared and, within a few years, WorldCom was bankrupt.

Culture as a Function of Leadership

Companies reflect the ethics of the leaders who run them. Bob Page felt like an outsider and had to hide his sexuality. When he built Replacements Ltd. he ensured that it would be a place that accepted diversity not just of lifestyle but of thought and would invest in building their community. Anita Roddick founded the Body Shop to show that you could build an environmentally friendly corporation that reflected her commitment to environmental activism. Jim Goodnight’s commitment to work-life balance is part of the culture at SAS, the largest privately held company in the world. Jack Welch’s commitment to being the best created an environment of excellence at General Electric. In each of these cases, the ethics of the leader became a central part of the culture.

The Obstacles to Culture Change

The real obstacles to culture change are what we call the internal obstacles. False ego, fear, complacency, and preconceived ideas create a negative environment. When change is introduced there is resistance, even when the change is positive. People learn different coping mechanisms to avoid the change such as hiding behind procedures, ‘office cooler’ talk or gossip and complaining, or actively undermining the initiative. The question then becomes how can leadership have a positive impact on the culture of an organization.

How can a leadership influence culture

Whether a leader comes up through the organization or is brought in from the outside to change the organization, there are ways that leadership can have an impact on culture.

1. Walk the Talk People observe what you do, not just what you say and the values of the leader, not just what they say, While Enron C.E.O. Kenneth Lay and his management team were stealing from shareholders, many of his traders were laughing how they were going to bankrupt little old ladies for their heating bills. This is the toughest part of leadership. Having worked with people who wrote books on the subject, I can tell you that often times their actions did not match their words and the affect was that a number of people had no respect for them. When you say you are going to do something, you need to follow through and do.

2. Rewards and enforcement are a function of ethics. .
We value what we recognize. How are people rewarded or recognized? For instance, if you want collaboration and teamwork and then reward people for ‘hitting their numbers’ then their energies will be on what they are recognized for. Jim Goodnight from SAS enforces that people only work 37.5 hours a week because they will be burned out if they work late hours and are therefore less productive. If ‘yes’ people are promoted, then the culture will see that conforming is the only way to succeed and you will create a hierarchical culture.

3. Be Passionate
Passion is contagious and people like to be part of it. As the saying in the Marine Corp. leadership program goes, “People will follow you because they have to or because they want to and who do you want with a gun at your back?” When you inspire people to make change, you literally reprogram their brains and they will take ownership to ensure success.

4. Get Networked with the Organization
Many senior leaders are very removed from the front lines, which is literally where the tire hits the road. These are the people who ultimately create the culture. Many leaders really only interact with their direct reports, which gives them a skewed sense of what is going on. What is really happening at the front lines of the organization? Who are the enablers and resisters in the organization? That is the one advantage of promoting within the organization – they know the people. Of course, the problems within the organization may call for new leadership. Either way it is important to be networked in the culture. There is the culture you have and the culture many leaders think they have.

A number of years ago, I heard this story from a client. He was upset that the organization was getting rid of their smoking rooms because smoking was being banned by law from the entire building. “Even though I don’t smoke,” he told me. “I was amazed by what was happening in there. People were really talking without regards to title because they had one thing in common – an addiction. One day a Senior Vice President came to me and told me about this guy he was talking to who had a number of very good suggestions regarding labor relations he wanted to implement. He asked me who he was, I looked it up and found out he was part of the custodial staff. He was literally the janitor.”

Leaders need to remove the layers around them and build in “smoking rooms”.

5. Communicate clearly
It may sound like an obvious statement but in the absence of clear communication there is unclear and informal communication, i.e. gossip. Gossip can undermine any change and have a negative impact on the culture. People appreciate honest and straightforward communication, even when it is negative. The worst part is not knowing.

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