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Culture Isn’t Everything

2015 October 18
by Greg Satell

The National Football League is a place steeped in tradition and resistant to change.  Chip Kelly, the head coach of the Philadelphia Eagles, on the other hand, is anything but conventional.  He travels widely during the offseason to pick up new insights, regularly consults with academics and runs a unique offensive scheme.

Yet it is his personnel moves that has raised the most eyebrows.  This offseason, he let go of the team’s quarterback, top running back and top receiver—all former All-Pro’s.  He also got rid of both starting offensive guards and almost the entire defensive secondary. Some of the key moves were done in the name of culture.

So how’s it going so far?  Not very well.  In the first three games of the season, his vaunted offense mostly stalled, putting up some of the worst numbers in the league.  Blockers miss their assignments, receivers drop balls and runners are caught behind the line of scrimmage with disturbing regularity.  Culture, despite what some say, isn’t everything.

What It Takes To Enforce Culture

In a competitive marketplace, top performers are highly sought after and given wide latitude. Yet Stanford’s Bob Sutton called this practice into question in his book, The No Asshole Rule, in which he presents a persuasive case—supported by years of research—that even one toxic person can ruin a workplace culture and severely decrease organizational performance.

At my previous company, before Sutton’s book was published, I implemented my own version of “the no asshole rule” that we called the fire nasty people rule and I strongly believe that it was a big part of our success.  We were able to build a highly collaborative atmosphere and that helped us attract even more talented, friendly people.  It became a virtuous circle.

When I talk about firing nasty people at corporate workshops, everybody seems to like the idea, but few actually implement it.  The reason?  It’s extremely hard to pull off.  Nasty people are often top performers, which is why they feel they have license for their behavior.  They also usually have other redeeming qualities and often attract a small but loyal following.

Enforcing culture is hard.  You have to be willing to fire people no matter what their performance and you can expect a backlash.  Nevertheless, if you want to build a great culture, that’s what you have to commit to.

Culture Is Only One Piece Of The Puzzle

Marissa Mayer arrived at Yahoo with great fanfare.  Formerly a top executive at Google, where everything she touched seemed to turn to gold, many thought that she could be a savior at Yahoo, a firm that has had long and very public struggles.  One of her first priorities was to transform the company culture.

She got right to work, instituting a major change in personnel policy that required remote workers to convert to in-office roles or leave the company.  At the time, I was encouraged by the policy.  Research shows that proximity matters.  People working remotely simply don’t build the same relationships or collaborate as effectively as those who work together.

Unfortunately, Mayer’s tenure at Yahoo has been less than successful.  She has been castigated for a number of missteps, including some bad hires, a failure create compelling new products and a fall in earnings.  One business professor at NYU even went so far as to declare that she would already have been fired if she wasn’t pregnant with twins.

Changing a culture is important, but it’s not a panacea and shouldn’t overshadow other priorities.  Sometimes, you need to be patient.  Chip Kelly, for example, waited till his third year—when he had already put together two winning seasons—before he made sweeping changes, which is why the reaction to his current troubles has been relatively muted.

The Continuity Paradox

Culture, to a large degree, is a set of organizational habits.  As Lou Gerstner pointed out, it determines what an organization rewards and punishes.  Do people seek out individual achievement or a positive team dynamic? Are they encouraged to take risks and blaze new trails or seek out a consensus?

The problem is that, to be effective, a culture needs to be seen as legitimate, rather than just a bunch of empty slogans.  That requires trust and trust takes time.  You can’t dictate culture, it needs to grow over a period of years.  It’s has less to do with any set of policies than how people interact, build relationships and measure success for themselves and their colleagues.

For example, in a study of star engineers at Bell Labs, it was found that the best performers were the most embedded in their organization’s network.  They worked in small, tight knit teams, but also reached out to a diverse groups of experts in a wide variety of fields.  These experts, in turn, helped the star engineers solve problems when they got stuck.

Think about that for a minute and it becomes clear why so many change management efforts fail.  To create change, you need to build innovative teams that work well together and with others.  Yet to do that, you need a certain amount of continuity.  Rapid change often breaks up informal networks in an organization and those bonds of trust take years to rebuild.

Building A Culture Of Purpose

Look at any great enterprise and culture is at its center.  However, that doesn’t mean that culture is where you start.  Rather, it’s an end point.  It is the culmination of many other things that an organization does.  As I’ve noted before, culture is how an enterprise honors its mission.

Let’s return to Marissa Mayer’s struggles at Yahoo. Her move to end the practice of working from home was in many ways a sensible way to build better collaboration.  But collaboration in the service of what?  She never made that clear.  So many people simply assumed that she wanted them to do the same things, just without the convenience of working remotely.

Contrast that to Chip Kelly, who made his emphasis on culture clear from day 1, but didn’t make any major personnel changes in his first year.  Then he let go of Desean Jackson—a star receiver—in his second year and did a major overhaul in his third year, after he already had some success and it was clear what he was trying to achieve.

That, despite very poor initial results, has given him some breathing room.  Culture is no panacea.  It only becomes effective when its purpose is clear.

– Greg

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