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What Happens When Leaders Forget the Culture That Made Their Company Great?

culture

What Happens When Leaders Forget the Culture That Made Their Company Great?

Many business leaders view their corporate culture as so important that they make it a point to hire people who are a good fit for that culture – and jettison any employees who aren’t.

But what happens when it’s the leaders themselves – for profits, for expediency, for getting the next deal done – who toss aside the culture and plow ahead with decisions that go counter to what made the company a success?

Trouble, that’s what happens, says Bill Higgs, an authority on corporate culture and the ForbesBooks author of the Culture Code Champions: 7 Steps to Scale & Succeed in Your Business (www.culturecodechampions.com).

“Your company’s culture should inform everything you do,” he says. “When you start straying from the practices that got you where you are, you run the risk of making decisions that will cost you in the long run.”

One example that surfaced recently involved Boeing, which posted its first full-year loss in more than two decades. The company was already reeling from two Boeing 737 Max crashes in 2018 and 2019 that killed 346 passengers in Indonesia and Ethiopia, and forced the company to ground its entire fleet of Max jetliners.

According to news reports, the origins of the company’s woes can be traced all the way back to 1997 when Boeing acquired McDonnell Douglas, a merger that immediately led to a clash of cultures. At Boeing, engineers were king. At McDonnell Douglas, the bottom line ruled.

In the end, the McDonnell Douglas culture prevailed.

“Mergers and acquisitions are always fraught with danger both financially and culturally,” says Higgs, a founder and former CEO of Mustang Engineering who recently launched the Culture Code Champions podcast. “Financial concerns get the focus while management figures, incorrectly, that culture will just work itself out.”

But in any organization – with or without a merger – it’s paramount that the leaders take charge of maintaining the culture. Higgs says some steps crucial to establishing a company culture and keeping it on course include:

-Encourage communication. Higgs is fond of saying that all problems ultimately are communications problems. In any organization, there can be communications breakdowns. “The most important way to improve execution and efficiency is to foster and maintain a spirit of inclusion, where everyone who has any contact at all with a particular project feels they are involved and is kept in the loop,” Higgs says.

-Knock down silos. Too often silos emerge in large organizations where departments become insulated from each other. They fail to share ideas and resources, and an attitude of competition replaces a spirit of collaboration.

-Make sure employees know they are respected and valued. This is the real key to building a successful organization and making sure your best people stay with you, Higgs says. Leaders should communicate regularly with employees to make sure they understand how valued they are. He says employees should also know it’s all right to speak up if they see something problematic.

“When I was at Mustang Engineering and we had grown from a small to a huge company, I still had drafters who were comfortable jumping five levels in the organization to let me know they would have to put out substandard work if the schedule or cost were not changed,” Higgs says.

“I always told them I would handle the issues internally with engineering and externally with clients or suppliers, but they should stay the course on quality.”

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Bill Higgs, an authority on corporate culture, is the ForbesBooks author of Culture Code Champions: 7 Steps to Scale & Succeed in Your Business. He recently launched the Culture Code Champions podcast (www.culturecodechampions.com), where he has interviewed such notable subjects as former CIA director David Petraeus and NASA’s woman pioneer Sandra Coleman. Culture Code Champions is listed as a New & Noteworthy podcast on iTunes. Higgs is also the co-founder and former CEO of Mustang Engineering Inc. In 20 years, they grew the company from their initial $15,000 investment and three people to a billion-dollar company with 6,500 people worldwide. Second, third and fourth-generation leaders took the company to $2 billion in 2014. Higgs is a distinguished 1974 graduate (top 5 percent academically) of the United States Military Academy at West Point and runner up for a Rhodes scholarship. He is an Airborne Ranger and former commander of a combat engineer company.

culture

Is America’s Corporate Culture In the Dark Ages?

American work habits can seem downright oppressive when viewed from afar.

Various reports and studies show that Americans experience a more burdensome work week than many of their peers abroad, spending interminable hours at the office, wolfing down lunch at their desks, letting vacation days expire unused, and answering emails after hours and on weekends.

It’s practically the dark ages compared to the rest of the civilized world, where 20 to 30 days of vacation are the norm, the maximum length of the work week often is set by law, paid parental leave is mandated, and some countries have even tried to legislate the “right to disconnect” for workers besieged with after-hour emails and phone calls.

This divide between America’s doggedly industrious approach on the one hand, and the less-relentless global approach on the other, might make it seem that a corporate culture developed for a U.S. company would prove a poor fit beyond our borders.

But that’s not necessarily so, says Bill Higgs, an authority on corporate culture and the ForbesBooks author of the upcoming Culture Code Champions: 7 Steps to Scale & Succeed in Your Business (www.culturecodechampionspodcast.com).

“Yes, there are differences, but there are also commonalities,” Higgs says. “There are people in every corner of the world who want to serve others, do high-quality work, collaborate closely with others, and have fun while doing it. Where they live or where they’re from has nothing to do with those traits; they come from the person’s character, not his or her nationality.”

Higgs knows from experience. He is a founder and former CEO of Mustang Engineering, and from 2005 through 2014, Mustang opened several international offices.

“Our first was in Woking, England, about 30 miles southwest of London, and it grew to about 450 people,” he says.

Within the next few years, Mustang added offices in Melbourne and Perth, Australia; Mumbai, India; Kuala Lumpur, Malaysia; Bogota, Colombia; Al-Khobar, Saudi Arabia; and Norway.

“That’s a lot of different cultures around the world,” says Higgs, who recently launched the Culture Code Champions podcast, which was named a New & Noteworthy podcast on iTunes.

Higgs says certain principles that make for a winning corporate culture are universal. Why? Because they all relate to people, and people are the crux of any organization’s success. A few of those principles include:

Open communication is critical. Higgs believes in encouraging employees to speak up if they spot a problem or have a suggestion. A corporate culture that promotes such open communication can work well anywhere in the world, he says, because it spurs people who have a different take on things to share their thoughts. If employees feel comfortable speaking out, that can help a U.S. company operating in a foreign land avoid missteps.

Smart hiring practices make a difference. It’s possible to take a new hire and train them to fit into your corporate culture, but it’s even better to hire people who are a good fit to begin with, Higgs says. “Whatever your values are, you want to make sure the new people you hire share those values, and that’s important both at home and abroad,” he says. A bonus is that, once you bring on good people, they often know other good people and can help you recruit.

A spirit of belonging helps promote a passion for work. People want to belong to something, which is why they buy the jersey of a favorite sports team or bumper stickers supporting a favorite cause, Higgs says. “For some reason, though, this sense of belonging rarely happens where people work,” he says. “But you can go a long way toward making people passionate about their work if you organize activities where they can get to know each other as people, not just coworkers.” In many cultures, people already like to spend time with coworkers outside of work, so for them it comes naturally.

“You really can break down the barriers that some think separate people in different parts of the world,” Higgs says. “Respect their local cultures, but invite them to belong to yours as well.”

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Bill Higgs, an authority on corporate culture, is the author of the upcoming book Culture Code Champions: 7 Steps to Scale & Succeed in Your Business. He recently launched the Culture Code Champions podcast (www.culturecodechampionspodcast.com), where he has interviewed such notable subjects as former CIA director David Petraeus. Culture Code Champions is listed as a New & Noteworthy podcast on iTunes. Higgs is also former CEO of Mustang Engineering Inc., which he and two partners started in Houston, Texas, in 1987 to design and build offshore oil platforms. Over the next 20 years, they grew the company from their initial $15,000 investment and three people to a billion-dollar company with 6,500 people worldwide; since then, it has grown to a $2 billion company with more than 12,000 people. Higgs is a distinguished 1974 graduate (top 5 percent academically) of the United States Military Academy at West Point and runner up for a Rhodes scholarship.

communication

Your Business Has 99 Problems and Communication is All Of Them.

Businesses face a multitude of vexing situations every day.

Sometimes these are quickly remedied, such as a missed phone call that must be rescheduled, or an unhappy customer who needs to be soothed. At other times, there’s a total breakdown and turmoil erupts, as in the recent GM strike where 50,000 auto workers walked out, venting their anger over a number of decisions by the company.

But, small or large, of minor importance or potentially ruinous, every cause for concern that a business encounters originates from the same place.

“All problems are communication problems,” says Bill Higgs (culturecodechampionspodcast.com), an authority on corporate culture and author of the upcoming book Culture Code Champions: 7 Steps to Scale & Succeed in Your Business. 

“How well you communicate is tied to your organization’s culture, which raises the question: What is your current culture costing you?”

Higgs says it’s common in the business world to be in a situation where someone asks or tells you to do something, you think you understand what they want, but when it’s done, it’s not right.

“When you both review what happened, you realize there was a communication breakdown at the outset,” he says.

Higgs recommends a few ways businesses can improve communications – and in the process avoid everything from minor mishaps to major disputes:

Seek and value input from everyone. A lot of rework could be avoided if leaders in an organization would empower their people to speak up if they see a problem, Higgs says. “Often, people remain silent even when they see something that does not seem right,” he says. “Why is that? I believe these problems happen because a person might notice something seems wrong, but he or she isn’t comfortable challenging someone who they see as more expert on the subject than them or who has more authority.” That’s why it’s important to foster an organization-wide culture where people feel comfortable challenging things, no matter who they are or who they are challenging. That way you increase the odds that things will be done right the first time.

Cross-train people so they better understand what others do. When employees have no idea about their co-workers’ areas of expertise, work slows down, as though everyone on the team is speaking a different language. “You want to get your people to broaden their knowledge and expand the scope of what they normally do in their own jobs,” Higgs says. As people learn more, they become more efficient and, for example, could handle questions from a vendor without bringing in other members of the team, saving everyone’s time. Higgs says cross-training often can take place when people have downtime, but if that’s not possible, it may be necessary to schedule time to make it happen.

Bust silos. Many organizations group people together by function. Marketing people work in the marketing department, finance people in the finance department, and so forth. Departments also are often separated physically. “This can create a number of problems and inefficiencies,” Higgs says. “For example, it can lead to lots of rework because silos are not conducive to communication.” Other problems silos cause include competition rather than collaboration among teams, and finger-pointing and blame-shifting when things go awry. He suggests that, instead of separating people by their functions, group them together in teams that are working on the same projects.

“Don’t let your people shut themselves off in their offices or workspaces, and don’t create such a hierarchy that people can communicate only through pre-approved channels,” Higgs says. “Effective teamwork requires good communication – and lots of it.”

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Bill Higgs, an authority on corporate culture, is the author of the upcoming book Culture Code Champions: 7 Steps to Scale & Succeed in Your Business. He recently launched the Culture Code Champions podcast (culturecodechampionspodcast.com). Higgs is also retired CEO of Mustang Engineering Inc., which he and two partners started in Houston, Texas in 1987 to design and build offshore oil platforms. Over the next 20 years, they grew the company from their initial $15,000 investment and three people to a billion-dollar company with 6,500 people worldwide; since then, it has grown to a $2 billion company with more than 12,000 people. Higgs is a distinguished 1974 graduate (top 5 percent academically) of the United States Military Academy at West Point and runner up for a Rhodes scholarship.