Viewed 717 times | Published on 2018-08-29 | Updated on 2019-04-03 19:19:50
Curious about the title? Well, let's just say that I think that anybody who stays long enough in any organization, when moving to another organization, carries along some "cultural frameworking baggage" (and, often, removes knowledge from the original company).
Disclosure (not needed if you read other material that I published online since 2003), as I prefer to remove off the table any bias before presenting any argument.
No, it is not a "Cicero pro domo sua" article, also if I obviously, even when I stayed long with a company (curiously, longer as a consultant than as an employee), it was always on "missions" and "targets", while having other missions and targets in other companies (and industries, countries, types of organizational structures, types of missions, etc).
So, I am cross-cultural, both in terms of languages, and in terms of industry- or size-specific approaches.
But was even so before starting officially to work, in the 1980s, thanks to political activities abroad.
Therefore, I am naturally inclined to think not in terms of cultural continuity, but in terms of controlled cultural dis-continuity.
Meaning: whenever you add somebody to the team, sometimes you want continuity (usually at the operational level, i.e. adding more of the existing skills),sometimes want to go completely the opposite way (shake up the "status quo ante", to change behavior), sometimes you want a bit of both.
Being an Italian by birth and raised in Italy, albeit working often and eventually also living abroad since the 1980s in few countries with a large foreigner community, with varying degrees of integration, you get used to a different concept of "continuity".
There is always an element of risk, pushing from "cultural continuity" to "cultural stasis".
This is just a short introduction (see at the bottom), but as some say that I usually write items that are too cryptic,let's stay to my current location and locally influenced news, before moving onto my theory.
If you look at my CV, you can see that, as I wrote few days ago on Facebook, I worked in few main industries in Italy since the late 1980s, automotive-banking-outsourcing, plus logistics and retail.
The curious part is that, even when I lived and worked abroad, only in banking, logistic, outsourcing, retails, I worked across few countries and companies.
In automotive and related, from the mid-1980s until 2018 I eventually had a mission within what used to be the main industry of my hometown, but always within a company of the FIAT group (now FCA).
Other automotive and related companies? Just to compare and study differences (starting with the obvious Toyota and Womack, and onward).
My latest mission ended in February 2018.
Few months later, the CEO of CNH Industrial left.
Few days before, he had announced (on newspapers) a plan for the future of the company that made few analysts (and myself) say that it was a look alike of the plan for the FIAT group of over a decade before, and then, few days later, announced that he would see himself as the next CEO of FCA.
I do not remember that many cases where the CEO of a company within a group announced on newspapers that he would like to become the CEO of the main holding.
The reaction was what you would expect: the then CEO of FCA, Sergio Marchionne, replied to a question by stating that he saw the CEO of CNH staying well where he was now.
Reaction to the reaction: the latter resigned, and left few months later.
Few weeks ago Sergio Marchionne passed away, and the choice for his successor was somebody who knew better the key market and key current product of FCA, Jeep- then, an Italian FCA senior manager who everybody in Turin assumed would were in line to succeed the CEO of FCA, resigned.
In both cases, at critical junctures in both companies (CNH, right after announcing a restructuring and repositioning plan; FCA, after the loss of a charismatic leader).
I know that many, locally and in the news circus, talk about something else- I prefer to talk about a matter of style.
As a smaller fry, personally, just to talk about Turin, e.g. in 2002, 2007, and early 2018 kept working on missioons also when it is wasn't convenient- continuity and transition still do matter, and my harsher judge on that count is the one that I see every morning in the mirror when I shave.
Now, at their level, both those who left will bring a wealth of industry knowledge and experience, wherever they go, but with a catch.
Let's move now to Tesla, struggling to turn from a "boutique" to a "mass market" producer of vehicles.
As many companies scaling up, obviously hired talent from "established" mass producers, as well as from potential competitors within the self-driving and electrical-vehicle domain.
Some news and industry analysts almost cheered the departure of some of the "newly imported talent", as a sign of failure.
Frankly, in my past across Europe I observed something else.
I will resume discussing the case of Tesla and other start-ups or "built around a core/leader" companies at the end of the article.
Let's say that you are a manager who grew through the ranks in a company across most of your career.
At each stage, you embed one bit more of the corporate culture- and, curiously, this happens both with larger and smaller companies.
In the former, the culture is embedded both in formal and informal processes: often, you do not proceed through the ranks unless you are "culturally compliant", no matter how much consultants and gurus write and deliver speeches or workshops on "making elephants dance".
In the latter, most elements are less embedded into formal processes and procedures, and more into explicit relationship/"corporate social" expectations.
In both cases, when you hire somebody who raised through the ranks in a specific culture, you do not get just the skills and experience- you get the corporate culture that they represent.
While larger corporations usually are more successful at "forging" their own culture, most smaller companies in my experience have a culture that is a blend of their own and their social culture, as they lack the structure and means to build a "bubble" around their own organization.
Many try, with a "cradle to grave" company support, but most fail to create their own "bubble community"- they still are embedded in their local culture.
Personally, I observed combinations of both cases in various countries and industries.
Now, if you get somebody from outside used to just one culture, and give them a directorship (or even worse, push them directly to the CEO level), they will be naturally inclined to replicate what they know.
I saw since the early 1990s in Italy and in other EU countries smaller companies hiring managers from larger, structured companies, in an effort to "cope with increased complexity and scaling up".
Fine concept- but, unfortunately, unless you consider the cultural aspect, you end up not hiring skills, but "transplanting an exogenous culture".
Better to keep, for a while, few degrees of separation from where they could act as "replicants".
Typically, a first litmus test is if, instead of trying to "convert" and "adapt" (themselves and the organization), they focus immediately on hiring people who are more like themselves, and building an even larger bubble within the organizatio, while sidelining all the incumbents as "alien" to their culture.
If the smaller company had a strong cultural footprint it would routinely reject the new approaches: you can increase turnover by just hiring the wrong manager (but sometimes this is a choice).
The issue extends also to companies with hundreds of employees trying to "grow" by hiring somebody from a multinational with tens of thousands of employees.
The main viable alternative? If the CEO/owner/senior managers were able to understand and integrate, they could get the best of both worlds.
Otherwise, there was also an opposite risk.
Do you remember the old sci-fi movie "The Blob"? More than once, I saw a similar event- if the new hire was motivated enough, could actually gradually convert the hiring culture into a scaled-down copy of his (as mostly this happened with men) old corporate culture.
With mixed successes: seeing a company wiht 1/50th the size of another one adopting the same processes and bureaucracy is quite curious, as basically it gets the overhead with no gains, neither in efficiency nor in efficacy.
Better off to "layer", like in an onion, with each layer having different levels of "alignment", and ensuring communication between layers to deliver overall consistency and stability to the structure.
Example: even a small company might cooperate with a large one, but the expectation from the larger entity is to have compliance with bureaucratic procedures that make sense when you have 50,000 employees.
If a 500 employee organization were to adopt the same procedures, would end up adding too much overhead and kill its own difference.
In that case, better either to become part of the larger entity or, if the purpose is to keep the smaller entity's flexibility, create a "compliance layer" that will limit the overhead while ensuring e.g. traceability.
But, of course, it has to be discussed on a case-by-case basis: just think about the issue and see if it matters for your organization, this is not a cookbook!
Now, back to Tesla and the like.
If you have a look at the book reviews within http://robertolofaro.com/books/suggested-readings, you can read of books that are actually discussing an issue related to industry 4.0, but that, frankly, I saw since the 1980s.
In order to keep this post short and, as the others in this section, "operational", I would share here just two cases.
One issue is the counterpart of the "transplant" element I discussed above.
So, if you are a small company and want to "structure up" your culture, organization, and processes, one way to do this is to get some of your own true-and-tried insiders embedded in your culture, and have them hired from a larger competitor, to be used as a "school ship".
Paranoid? No- frankly, I observed few cases, and are quite easy to spot, if you know what to look for.
Incidentally: as if by miracle, after a while, they return where they came from.
The other case is when a larger company needs to understand the forma mentis required to introduce new processes, technologies, approaches.
Sometimes larger companies take the shortcut of buying, obtaining as a net result that they lose those who can contribute the most, and keep the rank-and-file.
Sometimes, before setting up a joint-venture, or doing joint projects, or purchasing the company, is better to have somebody from your own organization to join them.
Provided that you have, again, somebody that you trust enough to be "structural" to your own coporate culture, and able to blend the best lessons from both world.
The benefit? This would enable to create a set of "cultural guidelines" that will allow to avoid doing what I saw in projects where two (or more) cultures that were too different tried to work together: it kept swinging from a dialogue where nobody was hearing, to a quest for territory, in both cases leaving behind more damages that lessons learned.
Over the last few decades we talked too much of human capital and people as if they were physical assets- forgetting that they are also carriers of habits, cultural traits, and, the longer they stayed anywhere, the more they will be used to a "different kind of normal".
The higher their position (or the higher impact their role) within the organization they came from, the higher the chances that what you will not see (the culture) will be based on a continuous stream of expectations.
Whatever your choice, the basic rule of thumb that I learned over the last 30+ years is: if you hire external talent, know first what you are looking for, and what are the impacts that you want to achieve on your own culture and organization- the higher they go, the higher the change that they might alter your culture.
And it is even more important when technology induces distributed decision making (e.g. "intelligent devices"), massive amount of data ("big data", continuous streams of data from your shops, locations, products), etc.
If anything, business 4.0 should highlight the higher need to avoid the loss of the rationale behind decisions, as it includes a costantly decreasing time to make a choice whose impacts will fairly outlast probably the tenure of the decision-maker in that role.
The first new issue of Business Fitness Magazine (to be published in September on http://businessfitnessmagazine.com) will be focused on these cultural issues.
PS More limited in scope, but today I posted also a short article (in Italian) focused on Turin and its soul-searching about a future: "spezzatino"