Female hand stopping domino effect on grey background

Who has to take the blame when a company is deemed to have the wrong workplace culture? Is it the individual managers who are not behaving correctly? Is it your Chief HR Officer? Will your board feel that it is their responsibility? Or will it be you, the CEO?
You have most likely read that Travis Kalanick, CEO of Uber, has been ousted from the company which he himself co-founded. Previously celebrated by many for running an aggressive strategy and a high-energy workplace culture, Kalanick has seen things go from bad to worse since Susan Fowler wrote her now famous post. Fowler, an engineer who left Uber in December, described in her post a sexist, discriminatory, and seemingly well-established side of the company’s workplace culture. Uber has defined 14 core values to guide decisions, processes and priorities – super-pumpedness, always be hustlin’, make magic are a few of them. Kalanick was not ousted for putting these in place. He was ousted because how he managed – or mismanaged – other aspects of workplace culture, as manifested in leadership, career paths, and collaboration.
Another celebrated CEO recently losing his throne is Martin Winterkorn of Volkswagen. The company’s engineers had installed software to cheat emission tests. Winterkorn resigned days after the scandal broke, and long before the total cost to Volkswagen was known, now estimated to more than 20 billion euros. Winterkorn still denies blame, claiming he was not informed. But whether he was informed or not, he is deemed to have neglected his duties as supervisor. The question being how this cheating could have been imagined at the first place and then survived the scrutiny of the Volkswagen management. The behaviour was shared and spread within the organisation and as such it was systematic. Cheating regulations was a way of doing things at Volkswagen (and arguably several other car manufacturers). Culture – the way of doings things – claimed the CEO as its victim.
After the last financial crisis, financial companies had to face numerous new interventions from the regulator. The goal of these rules are to avoid another financial meltdown, by trying to control excessive risk-taking. Legal checks and balances are part of most processes and transactions. Every CEO will have a well-staffed legal team to ensure full compliance. But the regulator is even more ambitious, indicating that financial companies must also manage their culture of risk taking. Basically, requiring companies and with their CEOs in charge, to monitor and shape “the way things around here”.
Corporate culture is not just about having Communications or HR stating the core values that you have decided. Culture is the way things are done in your organisation. It is worth paying attention to. Your CFO would approve as research shows that companies with a great work place culture are outperforming the average in terms of growth, profit and share price. And not paying attention to it could, similar to Kalanick and Winterkorn, ultimately claim your job.
Since you have read this far, culture is probably already one of your priorities. Or if not, perhaps you have found something to reflect on over summer. Unlike sales, not investing in culture doesn’t leave you with no culture. Instead it leaves you with a culture you probably don’t want. And perhaps, that you can’t afford to have.
Michael Daun, founder/CEO, Wellevue

Leave a Reply

Your email address will not be published. Required fields are marked *

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>