Taking the long view: building an enduring and trusting culture

Bob Lintz, one of the leaders featured in both our first book Trust is Everything and our forthcoming book Becoming a Trustworthy Leader, had the ability to take the long view.  Unlike many managers at GM, he didn’t skip around from plant to plant, promotion after promotion, but decided to stay in Parma, Ohio to build something that would endure, even after he retired.  Parma is still thriving today as one of the automotive industry’s highest quality stamping plants.

This new McKinsey study identifies three ways that leaders can help employees take the long view

1) root out unhealthy habits: Bob worked with the union to eliminate costly overtime and duplicative jobs.

2) prioritize values: Bob did this by eliminating the executive dining room, abolishing separate parking lots for hourly and salaried employees, and having managers no longer wear coats and ties.  He wanted the union and management to work together to bring in new business to the plant, and knew that they could not do it with old, traditional barriers in place.

3) keep it simple, but meaningful: Bob instituted an Open Door policy that he stood by.  Anyone could come to Bob at any time.

These are important principles to remember: easy to say, but challenging to implement.


Creating a Trustworthy Culture

This article is a reminder that while many things can be replicated from company to company, we can work hard to create a unique culture that is much harder to duplicate.  The author makes the point that building a unique culture does not have to be complicated: it can be as simple as a small, but powerful sentence that helps employees spring into action.

In chapter 6 of our new book, we discuss this very concept: how to build a trustworthy culture by sharing examples from some powerful leaders we have met.  For example, Two Men and a Truck®, International (TMT) uses simple but elegant sentences to remind their employees and franchisees of their culture that illustrate their values such as “Movers Who Care” and “The Grandma Rule“.  These are easy for the TMT family to remember and implement and make a big difference, if you happen to be a customer, as we have been 10 times!

Movers who Care” began when the founder of Two Men and a Truck®, International (TMT), Mary Ellen Sheets, gave away her entire first year profits to ten nonprofit organizations in her community.  That tradition is alive and well today with TMT giving away money from every move to the American Cancer Society.

In addition, TMT wanted a way to help movers to remember how to keep their customers’ belongings safe and knew that everyone would want to treat their own Grandma well, so in honor of their own Grandma who was so important in the founding of the company, they created “The Grandma Rule“: treat everyone’s belongings as if they were your own Grandma’s.

Both ideas are simple and elegant and convey their core values:  a focus on the customer and what is important.  Those are what keep their culture unique and trustworthy.


Assessing Culture is Critical

We talk extensively in our next book about how leaders build a trusting culture.  This HBR article is also helpful in understanding what specific questions to ask today when you are interviewing for a job in order to assess an organization’s culture to determine if it is a good fit for you.

Aneil and I have both worked for leaders and companies where we thought we had found a good fit, only later to discover that the fit was not right for us.  We were blinded by either the job or the friend that hired us, only to find out that there were deeper issues at play that kept us from truly trusting that leader and that organization to not only have our best interests at heart, but our customers best interests at heart, too.

We all want to work at a place we can trust to be excellent, care for us and for its other stakeholders, but today, it is a complex proposition.  A recent MetLife survey shows employee loyalty at a seven-year low.  Employees are not loyal because they don’t feel that employers are loyal to them.  There is definitely a trust gap here.

How have you created a more trusting culture at your workplace?

Greg Smith Speaks Truth to Power at Goldman Sachs

Update 1-16-12:

Goldman Sachs reviewing conflicts policies for M&A bankers according to the Wall Street Journal.

Original Post 1-15-12:

Occasionally, employees and former employees have the courage to speak the truth about what really takes place in their organizations.  The results are typically not pretty, but such honesty is essential to restoring trust and addressing endemic problems in an organization’s culture.  Given that our country is still dealing with the aftermath of the financial meltdown, we need much more honesty from people like Greg Smith.

Here’s what the Wall Street Journal wrote today:

Goldman Sachs Group Inc. GS +2.40% said it will examine claims by an employee who quit Wednesday that executives “callously” talk about “ripping their clients off” in order to make more money for the securities firm.

Photo: Jim Watson/AFP/Getty Images.

The pledge was part of a daylong scramble by the New York company to contain potential damage from the public attack. The employee, 33-year-old Greg Smith, wrote in the New York Times that he had decided to walk away from his 12-year career at Goldman because of the firm’s “toxic and destructive” culture—a 1,270-word denunciation that ricocheted around the world in sharply divided tweets, Facebook comments and blog posts.

At Goldman, the op-ed prompted anger toward Mr. Smith and new introspection among executives stung by persistent outside criticism of the company since the financial crisis began. Unlike previous incidents in which Goldman seemed to be caught flat-footed, company officials quickly launched a public-relations counteroffensive Wednesday that minimized Mr. Smith’s role at the firm.

In a memo to employees, Goldman Chairman and Chief Executive Lloyd C. Blankfein and President Gary D. Cohnwrote that Mr. Smith was one “of nearly 12,000 vice presidents” among more than 30,000 employees at the company.

This kind of news is only going to make it harder for Wall Street to recruit on college campuses, according to The New York Times‘s Dealbook.

By the way, here’s an excellent whjte paper about speaking truth to power, organizational culture, and organizational change by leadership guru Jim O’Toole.  It also contains a neat discussion of Sophocles’s Antigone, one of the original sources for the concept of speaking truth to power, as well.



Top Down Decision Making Inhibits Trust and Innovation

The September 24, 2011 edition of The Economist reports these survey results from LRN:

It found that 43% of those surveyed described their company’s culture as based on command-and-control, top-down management or leadership by coercion—what Mr Seidman calls “blind obedience”. The largest category, 54%, saw their employer’s culture as top-down, but with skilled leadership, lots of rules and a mix of carrots and sticks, which Mr Seidman calls “informed acquiescence”. Only 3% fell into the category of “self-governance”, in which everyone is guided by a “set of core principles and values that inspire everyone to align around a company’s mission”.

The study found evidence that such differences matter. Nearly half of those in blind-obedience companies said they had observed unethical behaviour in the previous year, compared with around a quarter in the other sorts of firm. Yet only a quarter of those in the blind-obedience firms said they were likely to blow the whistle, compared with over 90% in self-governing firms. Lack of trust may inhibit innovation, too. More than 90% of employees in self-governing firms, and two-thirds in the informed-acquiescence category, agreed that “good ideas are readily adopted by my company”. At blind-obedience firms, fewer than one in five did.

In our own research on organizational change, we’ve found similar results.  When organizations have tightly controlled decision making, employees evidence both distrust in top management and are less likely to engage in the behaviors that promote innovation.