Case Study: Three Keys To “cultural” Change In Your Organization
A lot has been written about Company Culture, every consultant in the world has the training program, book you need to read, or DVD you need to watch so you can shift the culture of your company to yield amazing results. However, the term Culture is an ambiguous one at best and the way you effect change on that is more about making changes to key personnel and procedures than having weekend team building events in the woods. Changing a companies “culture” requires making changes to leadership, or the way you lead your company. Check out the case study below on a company I experienced.
We will call the company Precision Manufacturing for this case study. I was once head hunted to work for a company called Precision Manufacturing. They were a manufacturer of a number of products and needed to see positive growth after years of decline. While we achieved what we could, the culture of the company was broken and in the end the changes that needed to be made never came about. The Executive Summery from the first report that I drafted after one week of reviewing the state of the company:
Precision Manufacturing is in need of major restructuring so it can move into the 21st century in terms of best practice, pricing, and technology. The key issue is a business structure that is not conducive to growth. Unless Precision Manufacturing is ready to take radical action as in organization it is my opinion that the Precision Manufacturing will be forced to drastically reduce operations and staff and continue to decline in the marketplace. The result will be bankruptcy or sale of assists and dissolution of the business.
Leadership: The leadership of a company is vital to growth and achievement and Precision Manufacturing had none. The owner spent little time understanding how his business had been effected by changes in the market to the point that he was oblivious to the costs of doing business and profits that his company was able to produce. In his mind he had a large building, lots of employees, and staff that would tell him what he wanted to hear, and would not pay vendors so that they could fund his personal projects.
Completely self obsessed the owner would discourage his employees by posting signs with quotes such as:
“It’s always good to stop short of your goals, that way you don’t have to think of a new one” or “Lower your expectations that way you won’t get disappointed”
These pearls of wisdom would be posted in the break room so all employees could reflect on them while they had their lunch. There was a major leadership issue within the company, but the owner was not involved in the day to day and only in the office a few hours a week. The bulk of the leadership responsibilities fell on the General Manager.
The General Manager of Precision Manufacturing was not a bad guy, he did not openly seek to destroy the company, he was just so far over his head that he did not know what to do. Coming in with fresh eyes it was immediately apparent that the former shipping clerk had no idea how to run a multimillion dollar company. Looking at the historical data (something that had not been done in over 5 years), the decline in sales and revenue was staggering.
The chart above shows the point where the new General Manager took over and the actual sales from 2003-2008 with the projected sales biased on the average rate of decline through 2015. The company had seen amazing growth before shift in power, growing as much as 22% in sales from year to year, however, the leadership behind that explosive growth grew frustrated with the company culture and left. The company decided to look inward and find a leader that would work with the culture, they found a perfect fit in a uneducated, inexperienced, but compliant employee that was willing to take the reigns and tell the owner what he wanted to hear.
(Now I am stressing this point because I have seen it time and time again where a company will resist change so much that they end up destroying the company they are trying to save. Take a moment to look at your small business and try to avoid the mistakes that others have made.)
The results of finding a mediocre person to lead a company of this size, is that you get mediocre results. The first year under his leadership sales only grew by 4%, 14% less than the yearly average for the previous 5 years. Over the 4 years that followed the companies sales would decline on average 16% a year. While the company had taken a massive cut in revenue the General Manager had not adjusted staffing to reflect the decline in business, in fact he had hired people. He also had not updated the costs of goods in over two years leaving the question up in the air regarding if they were profitable or not.
Understanding The Culture:
The culture of a company can be formed by many things, Mission Statements, Vision Statements, Directives, Goals, are all great and should be the force behind your company culture; but the people you choose to put into your organization will have the biggest impact on culture. No Book-on-Tape is going to magically fix your company. If your warehouse is a mess, inventory is off, and your employees only get sick on Fridays and Mondays, it is not because that behavior is in your company Mission Statement.
Precision Manufacturing had a incredible mission statement that was an entire page long with lots of bullet points, it spoke of pride, customer service, vision, and always doing what is right by the customer. However most of the staff had never read it, so how could they be expected to abide by it? The culture that had been formed over the years was one of protectionism where each employee was more concerned about protecting their position, power, or their own self-importance within the organization, to the point that is spilled over to the customers. Going through the records and assessing the business I discovered that one of the largest customers in the industry had not signed up to be a dealer and their was no answer as to why. I decided to visit the customer at their business and see why they had not done business with Precision Manufacturing and the answer was the customer service. I brought them on board promising to personally oversee their account, orders were flowing in from this client and many times they were large, and one day they just stopped popping up in my in-box. I picked up the phone and was told that the sales rep that would have been assigned to that account (and not they are not on commission) had called and told the client “your my account and you have to only place orders through me”. This came from the protectionist culture within the company where the employees were more interested in their own numbers than the overall health of the company.
Is your company culture creating a place where employees feel they are part of the team or are they only focused on protecting their job at all costs?
Job Descriptions:
Job descriptions can be one of the leading factors to poor company culture. At Precision Industries the General Manager was obsessed with “Cross-Training” it got to the point that sales people would be “cross-training” in accounting, and graphic designers were asked to bring people in the purchasing department “up to speed” in graphics software. Once his wave of cross training was done he decided that one of the sales people would handled accounts payable, that janitor would spend part of the day pulling and packing orders, that the shipping clerk would work part time in purchasing, the purchasing manager would also serve as the delivery driver, and that the marketing and design team needed to also work in sales. Everyone was so busy doing so many different jobs, that none of them were being done well. It was not as if there was a shortage of employees and people needed to double up. This was done out of fear and ignorance on the part of the General Manager who did not want anyone person to excel in any one field as to rise up to challenge him for leadership in the eyes of the owner, and secondly because he did not like having specialists with special skills he felt would be hard to replace.
Changing the “culture” of a organization requires that people know what is expected of them, what they are to do, and how they are to do it. Again your not really changing the actual core values of the employee, as that takes years of careful grooming, leadership, and being willing to cut loose employees that are not willing to work within the framework of your company.
Three Keys:
Leadership
Understanding The Culture
Job Descriptions
About the Author
Michael Satterfield has worked in the automotive aftermarket for over 10 years, with a focus on internet sales and marketing. Michael holds a degree in Organizational Leadership with minors in Political Science and History. He also holds certifications in Internet Sales and Marketing from Ford Motor Company, Kia Motors North America, and Nichols, Campbell & Marrow. Michael founded Satterfield Group to help small businesses in the automotive aftermarket better brand themselves and build their corporate identities using both traditional and internet marketing. Michael is also a regular contributor to many automotive and marketing publications.
|
|
Melissa`s Everyday Cooking With Organic Produce (Hardcover) $20.14 Must-have information and amazing recipes for cooking with the freshest, tastiest organic produce With hundreds of farmer`s markets and an increased interest in organic fruits and vegetables, today`s home cooks need an accessible reference for shopping and cooking organic. Melissa`s World Variety Produce is the nation`s leading distributor of specialty fruits and vegetables and the professional chef`s go-to source for new and unusual produce. Their products have been certified organic for over 10 years. In Melissa`s Everyday Cooking with Organic Produce, the team from Melissa`s compiles vital information on fresh, seasonal organic produce with the best recipes for getting the most out of your organic finds. This inspiring, mouth-watering resource is packed with delicious recipes and gorgeous full-color photos, making it a must-have for anyone who wants to incorporate organic produce into flavorful everyday meals. Inside, you`ll find more than 400 recipes, including quick-prep recipes and deliciously easy variations, as well as a special section of meatless options for vegetarians. Covers 56 of the most commonly available fruits and vegetables, arranged alphabetically for quick reference Includes overviews of each food, what to look for when shopping, tips on buying and storing produce, produce varieties, serving suggestions, and complete nutritional information in the standard USDA format Offers "Cook`s Notes" and tips, suggested variations, meatless options, and complete nutrition profiles for each recipe For home cooks who want the latest and most comprehensive information on shopping and cooking with the best organic produce, this book is an invaluable guide. |