Capturing the DIALOG of Corporate Culture
Gratisography

Capturing the DIALOG of Corporate Culture

Corporations much to the surprise of some individuals are just groups of people united together (hopefully) to achieve one or more shared goals that would have been far more difficult to achieve individually. Unfortunately corporate culture is ignored when we look at:

  • Failed mergers and acquisitions
  • Change in executive leaders who are directed to “turn things around.”

Mergers and Acquisitions the Two Edge Sword

Small to mid-size firms want sustainable business growth as well as extended market reach. By buying another firm that is profitable and in line with their own business industry or business model, they believe this is a viable strategy.

However the data regarding the success of mergers and acquisitions (M&A) paints a far bleaker picture. Actually according to one author, Robert Sher, a M&A is more or less a crap shot with a 50% chance of being successful. Those odds are not exactly promising.

In an article posted to Forbes in 2012, Sher noted 3 areas of concern outside of the actual cost of the merger to be addressed if business owners desired to move the odds in their favor.

  • Capacity
  • Culture
  • Corporate strategy

I am not sure if Sher intentionally placed culture in the center. However culture is what holds capacity and strategy together.

Culture is the mortar for the foundation of any business.

Corporate culture reflects the values of the organization through demonstrated behaviors. Without positive core values, the mortar crumbles and so do the foundational bricks because they are no longer held together. We have all experienced inconsistency as customers. That inconsistency can be directly traced back to corporate culture.

When one firm acquires another firm, the focus is on the P&L statement and culture is as noted previously is ignored or there is an assumption the newly acquired culture will easily merge into the culture of the firm doing the buying. Sometimes from my observations there appears to be a little to a lot of unstated arrogance within the acquiring firm.

Turn Around Drains Executive Leadership

Within mergers and acquisitions as well as turnaround initiatives, the talents of executive leadership are put to the test. What I have discovered in working with leadership in either of these instances is the executive leader’s own talents are significantly drained even when her or his actions are delivering the desired results. I know this because I had the opportunity to assess the talents of leaders through the Attribute Index before they accepted either of these corporate change initiatives. What also appears to be happening is their efforts leave them in isolation.

Turning a department or an organization around is not easy. Each department is like a gear of a fine, hand crafted watch. All gears must operate together. Unfortunately, if not all gears are working together, problems happen.

What is also interesting to note is these executive leaders because of their insightful leadership talents hire excellent people who have their own good to great leadership talents. During this turnaround process, these executive leaders are drained of their talents due to all the stresses and obligations lying within under performing bureaucratic corporate cultures. This is why leaders in these roles require more support their superiors realize.

Assess the Dialog

This raises the question how does one unite two different cultures or reduce the executive leadership drain facing leaders? My answer is to assess the dialog within the culture.

If we understand the origins of the word dialog it literally means to build a relationship. (Think Socratic Dialog) By assessing the corporate culture provides the opportunity to know where that relationship is strong as well as weak. Discovering any disconnects in that relationship is essential to ensuring the success of any merger and acquisition or “turnaround” initiative.

There are a plethora of organizational assessments on the marketplace. Some big named firms will even create a customized organizational assessment and charge big bucks. Yet, this is not necessary when there are proven assessments to tackle this barrier and are very affordable.

Probably the most affordable one I have discovered is D.I.AL.O.G. published by Resource Associates Corporation. This organizational assessment is aligned to Baldrige criteria; is currently available for several different industries including manufacturing, healthcare and education and has a 20 plus year history.

The acronym D.I.AL.O.G reflects the title of this assessment:

Diagnostic data

Indicating

ALignment of

Organizational

Goals

Beyond being aligned to Baldrige, this specific assessment recognizes the inherent value of alignment and embraces the 5 Star Model as developed by Jay Galbraith and his associates. When the following five areas of any organization are in alignment, this reduces poor performance as well as reduces the use of limited resources.

  1. Strategy
  2. Structure
  3. Processes/Systems
  4. Rewards
  5. People

The assessment is Internet driven with 70 responses in seven areas of operation:

  1. Leadership
  2. Strategic Planning
  3. Customer and Market Focus
  4. Measured Analysis and Knowledge Management
  5. Workforce Focus (Human Resource Development and Management)
  6. Process Management
  7. Business Results

Additionally an updated version includes an eighth category of sustainability along with 24 statements specific to sustainability.

Both firms, the one being acquired and the one doing the acquiring, require an organizational assessment. The results from these two assessments are part of the feedback and the foundation for effective execution.

Clarify the Feedback

Electronic answers are not the only solution to understanding the dialogue within any corporate culture. Actual one on one interviews with a segment of the population are also necessary. These interviews require the exact same questions to be asked to all respondents. The segmented population should reflect the same percentages as in the initial organization assessment.

Then these responses both electronic and face to face are gathered together. The next step is to meet with the executive leader and discuss the results of the organizational assessment. He or she then assembles his or her leadership team for further discussion and analysis. From these meetings, specific goals are constructed in all areas. The focus is twofold:

  • Continue to do what is being done well
  • Work on closing any misalignment

Forward thinking leaders will in many instances share the results with the entire team or department. This builds credibility for continue corporate dialogue because no one likes to be in the dark. Darkness only increases the possibility of stumbling.

Execute the Goals

Consistent and effective execution continues to elude leadership at all levels. Part of this reason is because of corporate culture.

Again people make up corporate culture as demonstrated through their behaviors. Execution is all about the actions necessary to achieve the goals. Unless everyone knows how to consistently set and achieve personal goals, then achieving corporate goals again turns into another crap shot.

Goals must be clearly communicated. How many times does it appear that individuals in the same company are fighting each other instead of working together?

Of course the goals must be in alignment with the overall vision and values of the buying firm while recognizing the vision and values of the firm just acquired. Here again is where both firms require the organizational assessment.

Corporate culture is critical for organizational success. We have heard enough horror stories about poor corporate culture from the US Internal Revenue Service and US Veterans Service to Enron and other for profit industries.

Executive leadership is 100% for corporate culture. When mergers and acquisitions take place, this is when forward thinking leaders must step up to the plate and take full responsibility for merging the two cultures in such a way that everyone is willingly united to move the now much larger organization forward. Taking this action is not easy and hence reflects why 50% of all mergers and acquisitions fail.

Learn more about D.I.AL.O.G.

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Related Reading:

Leadership

Sustainability

Leanne Hoagland-Smith, M.S., is an executive coach and talent management consultant who takes a heuristic approach to sustainable personal and professional growth. Her task is to support forward thinking leaders in bridging the gap between today’s results and tomorrow’s goals. She can be reached at 219.508.2859 central time. Follow her on Twitter or check out her profile on LinkedIn.

Note: In full disclosure, I am an affiliate of Resource Associates Corporation as well as I hold a Master’s of Science in instructional design and technology. Knowing how to write good assessments is part of my education and training. Over the last almost 30 plus years in business I have personally taken several organizational assessments. D.I.AL.O.G. is probably the easiest, quickest and most reliable of those I have taken.

Greg Stuart

Strategic Executive Coach| 45 Years Leadership Development | AI Integration | Certified Business Coach Championing Excellent Listening for Results

9y

Great article, Leanne Hoagland-Smith. I have used DIALOG with my clients for years and everything you say about using this tool to support the goals of leadership is true. In my experience, leaders have discovered many blind spots using DIALOG that they weren't previously aware of. Because of the insights they have gained, many of my clients now use DIALOG as an annual measurement tool.

Sue Hays

Building Customer Satisfaction and Retention

9y

Your remark on turn around draining executive leadership and your measurement of this using the Attribute Index are really great insights, Leanne Hoagland-Smith. I'm now curious to know how this phenomenon can be alleviated.

Susan Lauer

Certified Business Coach. Principal at Aspire Consulting.

9y

Leanne, Great article, a recent article and some good points. A recent article in HBR highlighted the key attributes of senior leadership in the aquiring organization and middle management at the company being acquired that lead to success.

Deb Calvert

We build organizational strength by putting PEOPLE first. Engagement, retention, morale and productivity soar when you put PEOPLE first in business.

9y

I agree, Leanne, that corporate culture makes a huge difference in a company's long-term health and success. When leaders fail to understand the importance of culture, irreparable harm can occur. Insidious counter-culture influences erode what may have taken decades to build and, as you said, the very foundation that made a company can crumble away if not undergirded. Thank you for an important post.

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