Posts Tagged culture

422 — Managing The Problem Employee

Nick, the managing partner in a professional services firm, was irritated. “We have a 15 year employee who at first communicated very well and was promoted to Office Manager. In the last few years he has begun to hold information too close to his chest. Now people see him as a roadblock. I am very uncomfortable with the situation I haven’t talked with him about it. What should I do?”

This office manager may be responding to something that happened outside of the office, but most likely he is responding to something that has changed in the office. It’s often difficult to see what has changed, because changes are typically slow and seem natural, almost invisible. Here are steps you can take to understand and change situations that lead to difficult behavior.

What Should I Do?

What people do depends largely on their situation. Most people respond reasonably to situations, from their point of view. If you want to understand why people do what they do, stand back and look at their situation — perhaps ask the person about it. If Nick can understand that his Office Manager is behaving appropriately, from that manager’s view, he will be well on the way to solving the problem.

The first step in problem solving is identifying who has the problem. Here the employee, the “problem manager”, doesn’t have a problem. Nick and other people who see this manager as a roadblock have the problem. Nick’s problem won’t go away until he finds a way to have the employee own it. One guide to a good culture is, “People like to be involved in decisions that affect them.” People who are affected by a problem should be involved in the solution to that problem. In this case the employee should be involved in developing the solution for at least three reasons:

1. So he will take ownership of the problem.
2. When he takes ownership, he will be motivated to correct it.
3. He probably knows already how to correct it but he hasn’t acted because he doesn’t see it as a problem.

Finally, all company situations, including “problems”, are opportunities to develop the work culture — to improve relationships, communication, trust, involvement, and teamwork. Nick can use this “problem” as an opportunity for positive cultural change.

What Causes Changed Behavior?

The Office Manager’s change over 15 years didn’t happen in a vacuum. Nick needs to know if something outside of work has affected the employee; a divorce, ill family member, or something else that might have caused withdrawal or depression. Assuming there is nothing at home, look to the office.

Begin With the Leadership

Perhaps Nick and the other partners in the company have inadvertently done something that set the stage for the manager’s new behavior. As you do this keep in mind that systems, such as companies, are highly coherent. A behavior pattern in one part is usually found in other parts. When there is an issue at a low level in an organization, you’ll almost certainly find it at the highest level as well. Nick should meet with his partners and ask, “What could we do as a group to make clear, by what we do every day, that we do not want to hold information close to our chest?”

These are difficult and usually uncomfortable questions for any group to discuss. Leadership groups often use a third-party to help facilitate such discussions. See 421.

Don’t Get Bogged Down With Analysis

Looking backward and trying to analyze the many and complex causes of human behavior can be a quagmire. Managers are sometimes tempted to treat people problems as they would treat a faulty engine. But people are not machines that you can disassemble to find the busted part. With people, rather than trying to do a “root cause analysis”, it is usually better and less painful to look at where to go and opportunities to get there.

A First Action Step

Nick might also arrange a small meeting including himself, the Office Manager, a few other people who have expressed a concern, and one or two other partners — their presence signals the importance of the issue. At that meeting, Nick can discuss the company’s need for improved communication. He can describe a few examples of problems and of successes, and also share what the partners are doing to improve their own communications.

Don’t Point Fingers and Blame

It is essential not to blame a person or point a finger. Employees should understand that managers see problems as a system issue and not a personal issue. Pointing fingers is like saying, “The hole is in your end of the boat, so I’m OK”. Blaming causes defensiveness, not a quality you want in your organization. Have the members discuss the issue, but don’t jump too quickly to action at this first meeting. Stay with step one of the 4-step decision process. Ask the members of the group to reflect during the next two weeks on how they experience communications in the firm and what they might like to do personally, or suggest that the partners might do, to improve things. Schedule another meeting in two weeks to discuss and understand the situation further, to hear people’s ideas for changes, and to agree on who will do what.

Follow Through Is Essential

Broad cultural or system issues, such as communications or relationship problems, are among the toughest issues managers face. Solving these deep seated problems requires steady attention from the leadership group. This means regular, visible and open meetings focused on moving forward, one small exploratory step at a time. Only when the leadership group shows serious commitment will everyone change from the way things are. As I’ve said often elsewhere, if a cultural problem is delegated to a low level for action, nothing will change.

All Paths Lead to Rome

Once top management is clear to itself and to others that a particular problem needs attention, there are many approaches. Here I’ve mentioned two. Because cultural problems are all closely related it may be just as effective to initiate a change in some other related area. If you can’t decide where to begin, just ask any employee for a suggestion and start there. Culture change is an evolutionary process, the next step depending on what happened when you took your last. Once you choose your destination, i.e. what qualities you want or what you want to change, if you remain open and responsive to what happens at each step, it hardly matters where you begin, or which path you take — you will arrive safely.

cc 422 — © Barry Phegan, Ph.D.

Posted in: Topics and Issues — People

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132 — To Understand Behavior, Look At the Situation — The Culture

A person’s behavior is information about the person’s situation. Culture is the situation. To understand culture, look at what people do. To understand behavior, look at the culture.

When something goes wrong:

      • Don’t focus on the person as if they are the problem.
      • Don’t look at the problem as if it is an independent event.
      • Do look at the situation that led to the problem.


“There is no event in a vacuum.” Most problems come from the system. Most system problems come from poor decisions, resulting from poor relationships and communications. These are cultural issues, which is why the culture is always part of any problem, often the root cause.

Culture Is the Context for Human Actions

What people do comes from who they are and the situation they are in — a person in a culture. People in any culture behave similarly because they have a shared sense of what is appropriate. At work, our national culture combined with the local company culture, tells us what is appropriate. Anthropologists have long known that culture is the context that explains human actions.

1-situation behavior

Personality plays a role in what happens, but as a manager you cannot change someone’s personality — and you probably should not try. The situation or company culture is the most important part to look at for two reasons:

  1. The culture is the part leaders can manage.
  2. Managing the culture has great leverage. Developing the culture lifts the whole ship, not one part — it is a very efficient allocation of management time.

cc 132 © Barry Phegan, Ph.D.

Posted in: About Company Culture — Person and Behavior

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431 — Improve Safety, Reduce Accidents

When leader’s actions show that they take personal responsibility for safety, employees will act safely.

Only With Trust Can You Discover the Truth

It was 7 AM when Andy Brown, Vice President of U.S. Manufacturing arrived at his office. The night before there had been a deadly explosion and fire in one of the company’s Gulf Coast plants. His boss, the EVP Operations, called. After talking for a few minutes Andy put down the phone and said, “He wants to know what happened and he wants some heads on the table. I tried to tell him that I can do either of those things but I can’t do both. He wouldn’t listen.” We discussed his dilemma and he quickly came up with a brilliant one-liner that would make a great corporate bumper sticker:

safe plant bumper sticker

Andy knew that to get at the root cause of the explosion, people must felt safe to speak the truth. If they were afraid for their job, he probably could not get at the real cause and therefore not know what procedure modifications to make to prevent another similar blast. Andy knows that to understand a problem you must look at what led to it, to the context, the situation, the system, the culture. To Andy, the explosion was a symptom and the cause was the system. To his boss the explosion was a problem that someone caused.

People don’t come to work to perform poorly. They want to be proud of their work and feel that they are a valuable and appreciated team member. Few of us deliberately do the wrong thing. There is rarely an excuse for poor performance, but if you look carefully you’ll always find an explanation. Every careless person has a reason.

Accidents Are a Symptom of a Cultural Problem

You can’t understand the cause of the accidents unless you put yourself into the employee’s shoes, understanding why the employee bypasses procedures, takes shortcuts, and ignores obvious evidence of mounting problems, and why, after an accident, the employee justifies this behavior with, “That is how we’ve always done things here.” Culturally speaking the employee did nothing wrong. He or she did just what was expected, behaving appropriately to his or her situation, to the culture, to what managers ask for, not in words but through their actions.

We each know what it’s like to work under pressure to get the job done. You feel that push every minute, in everything you do. Senior managers may even have a bonus for on-time or early project completion. Leaders typically deny any relationship between accidents and their leadership. Ironically, if their division does well they will quickly claim personal credit. But if there is an accident that same manager will blame it on external events or someone at lower levels. Looking in the mirror is painful.

Safety or Profits, or Safety and Profits? — Example

Jack, the manager of a large processing plant regularly preached to his managers and employees about safety, yet the plant’s safety record lagged well below the company’s norms. Jack was unaware of the contradictions between what he preached about safety and what he said through his actions. In management meetings he focused on the numbers, on productivity, labor hours, maintenance costs, expenses, overtime and downtime. It was clear to his managers, and everybody below them, that financial performance trumped safety — every time. Jack justified his emphasis saying, “That’s’ my job. If we aren’t profitable we won’t stay in business!”

We suggested to Jack that if he wanted to improve safety it would need to share the stage with finances. The message took repeating but Jack eventually heard it. He started opening his management meetings by asking for the safety numbers and how these affected his employees. It wasn’t long before the safety numbers improved — significantly. Jack was surprised to see that along with improved safety numbers, productivity slowly rose. His conversations with supervisors revealed that improved safety was improving employee morale and work attitudes. Employees were bringing more responsibility and energy to their jobs.

Fear Brings Silence

Most corporate executives claim they are not afraid to say what they think when they are in meetings with their peers and the CEO. Is that true? Executive meetings are typically dominated by the powerful field of competition, power, authority and control. Put a bunch of alpha males in the same room, human nature prevails. If this were the open savannas of Africa, fangs and claws would be bared — there would be blood. That’s scary.

But in the controlled calm of the executive suite competition is more subtle. Fear is largely suppressed and denied behind a cool front. What is thought and what is said may be worlds apart. When not speaking up, except about “business” issues (levels 1, 2 and 3 of culture) is the model at the executive level, you can be sure it’s the same down below.

Investigators of the BP Gulf oil spill, along with other well-researched “incidents”, unearthed the fear of speaking up. Most companies have box cars full of safety procedures. They don’t need more. The problem is that even when employees know the rules, know what should be done or see something being done wrong, they don’t speak up, don’t say “Stop.” Anyone who has worked in a large organization knows exactly how that feels. Bravery is stupidity.

Ironically, leaders in these bureaucratic and autocratic cultures often imagine they can improve safety by issuing even more rules and harsher directives, maybe even shouting at people to follow the rules and speak out. Of course in a culture or fear and passive-aggressive obedience, this has the opposite effect. It brings more fear, more silence.

Executives Will Get What They Ask For

As we say repeatedly on this website, what people do at the top gives permission for what happens below. To say that in reverse — if there’s a problem at lower levels you can be sure it is mirrored by a similar problem at the top. So if you plan to improve or develop a safer work culture the leadership team might ask itself, “What can we do differently to show we want things done differently in safety?”

These discussions invariably include the human levels of culture. They bring more openness and trust in the leadership team. When leaders combine that with trying new ways of showing safety in their daily work, they start changing the culture. This happens automatically as people below look up, see the new expectation and copy it. People want a safe workplace. When they see they have permission it doesn’t take long before the workplace is more psychologically and physically safe.


1. It is important that leaders don’t navel gaze by asking what they’re doing now that fosters the present safety problem. Human behavior and cultures are far too complex for such simple analysis. Searching for behavioral causes only brings accusations, denial, makes people angry, and in any case looks backwards rather than forwards. It’s more useful to ask, “How can we show greater safety with small changes in how we work together as a team and to how we each do our daily work?”

2. Delegating safety problems to Human Resources or to the engineering department is not only irrational, (it is a leadership issue, not a procedural, training or HR issue) it is counterproductive. People know safety is a leadership issue. When leaders delegate the problem there’s a clear message, “Don’t change. Keep things the way they are.

cc 431 – © Barry Phegan, Ph.D.

Posted in: Topics and Issues — Operations

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142 — What’s the Cash Value of Developing Your Culture?

Today most executives agree that a well-developed company culture is a formidable competitive asset. However like all business decisions, the investment in developing your company’s culture should be weighed against the benefits.The pages below will help you calculate the cash return from investing in outside expertise to develop your company culture.

1. Assess Your Existing Company Culture 

Most managers are not familiar with thinking or talking about their company’s culture. This first question prepares you to answer the unfamiliar questions that follow. This question has statements about qualities or attributes of a well-developed company or business unit culture.

How are these qualities in your company or business unit? Check Agree   X   or Disagree   X  

Agree ___  Disagree ___    People here feel useful and productive.
Agree ___  Disagree ___    People here can be creative.
Agree ___  Disagree ___    People here see endless opportunities for improvements.
Agree ___  Disagree ___    People here know how they fit into the big picture.
Agree ___  Disagree ___    People here feel they belong.
Agree ___  Disagree ___    People here know they are valued for their work and contributions.
Agree ___  Disagree ___    People here have fun.
Agree ___  Disagree ___    Relationships at work are mature and non-political.
Agree ___  Disagree ___    People here have enough information to make good decisions.
Agree ___  Disagree ___    Most people here bring their full energy and creativity.

The Workplace
Agree ___  Disagree ___    This is a powerful company that engages employee’s hearts and minds.
Agree ___  Disagree ___    Procedures here are designed along with the people who will use them.
Agree ___  Disagree ___    Relationships and communications are fine.
Agree ___  Disagree ___    Power and control are widely shared.
Agree ___  Disagree ___    People are involved in decisions that affect them.
Agree ___  Disagree ___    The company creatively responds to challenges, suggestions, and change.
Agree ___  Disagree ___    Employees recommend working at this company to family and friends.

Agree ___  Disagree ___   Leaders here put people first.
Agree ___  Disagree ___   Leaders here are good coaches.
Agree ___  Disagree ___   Leaders here ask people how they can help them.
Agree ___  Disagree ___   Leaders here set a clear direction — “This is where we are going.”
Agree ___  Disagree ___   Leaders here recognize, celebrate and reward desired behavior.
Agree ___  Disagree ___   Leaders here give everyone background information, the big picture.
Agree ___  Disagree ___   Leaders here protect people from abuse from the system above them.
Agree ___  Disagree ___   Leaders here make cooperative, team decisions.

Hopefully that got you thinking culturally.

2. Valuing Your Potential Company Culture

Studies indicate that most employees bring to work around 20% of their potential contribution. With a well developed company culture people will bring much more. Even with a conservative estimate doubling that 20% to say 40%, it’s clear why a more developed workplace, that more fully engages employees, is overwhelmingly competitive and profitable.

The six questions below describe some ways employees respond when leaders deliberately develop their company’s culture. Answering questions 2 thru 9 is difficult. Please try to put an approximate number against each item. You may not even know where the decimal point is. That’s OK. Remember, “Perfection is the enemy of the good.” Just make your best guess.

What would be the annual $ value to you or your company if all your managers and employees:

$ ________  Took full responsibility for identifying and solving problems in their work areas, without just passing them on to their boss?

$ ________  Watched and cut costs as carefully as you do?

$ ________  Look out for what is good for the company rather than just what serves themselves or their department best?

$ ________  Treated customers as if they cared about them personally, and customer loyalty doubled?

$ ________  Communicated so well up, down, and sideways that work always flowed smoothly across departments and throughout the company?

$ ________  Continually sought new, creative ways to improve work processes and build the business?

Nationally, The Cost of Underdeveloped Cultures is Enormous.
Nationwide the greatest loss to American business is the withheld energy and creativity of employees at all levels. If you assume even a minimal lost productivity of 5% (and it is probably closer to 50%), the annual national cost is in the trillions of dollars. Developing a powerful workplace culture — where people bring more of themselves to work — saves you your share of this terrible national waste. In many companies, reallocating a small part of the money now lost to low productivity, absenteeism, turnover, and dealing with unnecessary problems, would more than cover the costs of getting their people involved in a positive way.

3. Productivity

What would be the annual added value if employee, plant, business unit, or company productivity increased?

10% $ ___________        20% $ ___________      50% $ ___________       100% $ ___________

4. Labor related issues (If your facility is unionized)

Over the last 12 months what might have been saved if there were no discipline hearings, arbitrations, or attendance discipline issues?

$ _______________

5. Accidents and Safety

If applicable, what would be your annual savings if you had no major accidents and lost time injuries were well below one/million+ labor hours?

$ _______________

6. Attrition/Turnover/Retention

What would you save annually on recruitment, training, etc. if turnover was cut by 75%?

$ _______________

7. Reduced Management

Traditional workplaces have high control costs. In developed company cultures, employees take responsibility and control, solve workplace issues and feel freer communicating across boundaries and levels. These companies have low control costs, i.e. far fewer supervisors and middle managers. What would you save annually with 20% or 40% fewer supervisors and middle managers?

20%   $ ____________          40%   $ ____________

8. Your Culture Goals

Imagine that in 18 – 36 months you have the culture you want. What would that be? How would you like your company to be different? What four main results or outcomes would you want? (See also 312 — The Five Steps to An Unbeatable Culture,  1. Choose Your Culture Change Goal)

a. _________________________________________________________________________

b. _________________________________________________________________________

c. _________________________________________________________________________

d. _________________________________________________________________________

9. Estimate the Return

Everything described in 1. thru 8. is realistic and achievable. If you developed the culture you want, what would you estimate its annual added value would be to you, your company or your business unit? Keep in mind that the benefits of culture change are cumulative and ongoing. They begin appearing within the first eight weeks, are normally visible company-wide within the first 12 months, and solidly in place within 2 to 5 years. The three main variables are the industry type, the strength of top management support, and the company’s size.

Estimated Return/year   R $ _____________________

10. Select The Investment

Few managers are skilled in culture change. It is practically impossible to do without professional assistance. The figures on the chart below are drawn from my experience. However organizations vary enormously even within industry type, so the numbers are guides only. They represent only the investment in outside expertise. However the internal investment of top management time is relatively small, perhaps 3 – 4 hours per month, and that is mostly in the first six months of the culture change process. Employee problem-solving teams pay for themselves almost  immediately. After six months the culture change process naturally merges with normal operations and does not require additional management time.

Locate your company on this chart by # Employees (total FT payroll)
If you have say 500 employees, imagine a vertical line half way between 100 and 1,000 on the # Employees line. Your estimated Investment/year would be half way between $400k and $2,000k, i.e. $1,200,000. Write your Investment/year number into Question 11, 2nd space.

# Employees                                    10               100               1,000          10,000              100,000
Investment/employee/year         $9,000          $4,000           $2,000             $500                 $100
Years to complete change               1                  2                    3                    4                     5
Total Investment                            $90k            $800k           $6,000k        $20,000k         $50,000k
Investment/year                             $90k            $400k           $2,000k        $5,000k          $10,000k

11. Calculate Your ROI

Divide the Return/year (your estimate from Question 9)

R $ ________________________

by the Investment/year (taken from the above chart 10.)

I $ _________________________

R/I  =  _______ X 100 = _______ ROI %

Surprised? Typically the ROI in company culture is exceptionally high.


cc 142 — © Barry Phegan, Ph.D.

Posted in: About Company Culture — Why is Culture Important?

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133 — Splitting Thoughts and Actions Cuts Profits

For many employees, what goes on in their head is not what they show through their words and actions. This split between thought and behavior is stressful and unproductive, a waste of company resources — bad for people and bad for business.

One of the many threads that led to my interest in culture was the book Something Happened by Joseph L. Heller of Catch 22 fame. In his book, Heller chronicles the inner life of Bob Slocum, a corporate middleman acutely conscious of company politics and power.

Like your average corporate employee, Bob Slocum struggles with what to say and what not to say in a meeting. He tries to interpret comments and glances in a hallway. He is uncertain about where he stands in the eyes of those above him. He does not say what he thinks. The contrast between his thoughts and actions, his feeling and words is jarring. What is real and unreal, true or false, rapidly blurs.

This describes my own experiences in my 20s, first as an employee, and later as a supervisor and manager in several companies. Later I thought, “If Slocum experiences corporate life like I do, perhaps others do also. Why don’t we talk about this at work?”

Dividing Thought and Action

We each adopt to the world of work. If we don’t we are ejected. I learned, as most of us do, that at work we discuss the abstractions, the ‘quantitative’ details of production — the numbers. In business meetings we rarely discuss the hard data of our immediate concrete experiences of work. We do not put these personal facts on the table. We sit in meetings thinking constantly, saying little. If we do talk about our feelings, it is at lunch, at the water cooler, in the restroom, after the meeting, or to our spouse in the evening, or to our friends at social gatherings.

Joining Thought and Action

Companies with well-developed cultures build relationships and trust that allow people to say what they are thinking, to be what they long to be, to hold together thought and action, to bring more of themselves to work. These companies are highly energetic and creative, a pleasure to work in, very productive, and exceptionally profitable.

cc 133 — © Barry Phegan, Ph.D.


Posted in: About Company Culture — Person and Behavior

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