Organizational Culture Case: Control the Machine mindset
After looking at some powerful questions based on the Competing Values Framework, let’s look at this case that illustrates the crucial role of (positive) leadership. It shows how an “old-fashioned” CEO stifles an organization and how one division considers taking ownership of their change. Positive leadership started with asking different questions and giving their staff more space and trust to solve the challenges of this division…
Meet the mechanics and engineers
The organization “MM” has machine maintenance as its core business, next to process optimization. They have locations all over the country, and their 400 employees can be divided into mechanics and engineers. The specialist mechanics work at the client’s site to do machine maintenance. The engineers give advice and guide more complex projects around process optimization.
MM is organized in a traditional hierarchical structure, with a strong CEO on top. They are organized in four divisions throughout the country. Each division is organized in several locations, with a location manager who is fully accountable for the budget to spend and the turnover that their location generates.
MM’s CEO is an elderly man who has been with MM for ages and he practically IS the company. He likes to control everything, and he is concerned about their deteriorating profits and worsening numbers. The four division directors report to this CEO, who means well but gives them “little space,” as they say.
The MM organization is facing increasing competition in a market that is shrinking due to the economic downturn. Client factories try to postpone their maintenance. They want to avoid expensive hiring of outside mechanics. The strength of MM’s mechanics, however, is that they are well trained with up-to-date knowledge. They are outsourced to the client’s site, but once this factory needs to cut costs MM’s mechanics are the first to exit the gate.
Another challenge is the hiring and retention of technical personnel. There’s a shortage on the market for higher-educated, specialist mechanics and engineers. MM invests in their training and education, but they leave easily, hired by a competitor.
The biggest of MM’s four divisions decided to use the OCAI culture assessment because they needed to change to face their challenges. The managing team got together for a one-day workshop to discuss their OCAI profile and develop a plan to change.
Break free of Control
They recognized their current (dark side of) Control (Hierarchy) culture instantly and they admired the preferred Create (Adhocracy) culture that illustrates the need for change at this point in time. In spite of the OCAI survey outcome, they don’t really consider so much of this culture type for their business in machine maintenance, but it depicts a feeling: they want to break free of control.
Their dominant Control (Hierarchy) culture is over 42 points, softened by around 32 points of Collaborate (Clan) culture. The CEO is a people-oriented man; that’s why people matter. The mechanics form close pairs when they are working on machine maintenance with a client. Colleagues know each other well. But the thing is, their Control culture evolved to its dark side and is “over the top.” As we do the work of making organizational culture operational from values down to behaviors, they come up with this list.
Current Culture Behaviors
Current behaviors are:
- You can’t do anything without a signature.
- We shift accountability upwards, so it’s never our fault, but our boss’s.
- We respond by procedures when we want to arrange something; we don’t make an exception for one mechanic, but we try to rewrite a procedure, so all possible circumstances are covered, turning the procedure into a phonebook.
- We spend two pages on explaining why a request was declined, trying to be correct according to the rules and keeping our relationships well.
- We spend our valuable working time on solving issues that should not have happened in the first place. Because no one has a clear overview (phonebooks everywhere!), there’s a lot of confusion and discussion.
- You have to deliver your numbers the fifteenth of every month, no matter what. Even if it would be wise to wait until you get that crucial information on the 16th.
- People tend to manipulate figures to make them look good on the 15th. This is not efficient. The pressure to deliver detailed reports to the CEO and answering his questions is keeping us from doing our work. His fear of declining turnover is turning into reality this way....!
- We now have 15 autonomous location managers - we hold them accountable, but we don’t reward them. Moreover, they are being treated as children who are called in to report and who are patronized.
- We shift accountability to other levels: three others after me will check the document, so I don’t read it but simply sign it. The thing is, the other three think that I checked it and might sign the document too, without properly reading it...
- Our mechanics can get all the technical courses they want, but 2 miles extra driving on their declaration will be declined by the accounting department, explained in 2 lengthy pages. We seem to be “penny wise and pound foolish.”
- We cannot make mistakes. All executives focus on details. Details are important and should be correct at all times.
Control based on Fear
These behaviors and examples illustrated their workplace. They sighed: “Isn’t it incredible how we still make money in spite of producing all these papers and reports? We do this to reassure ourselves and each other and most of all, our CEO.”
The division director said: “Every time I plead for more freedom and trust, the CEO says to me: ‘I am responsible for this shop! I can’t take risks and let anyone experiment with anything, or we will all go down. You have the biggest division so if you fail, this entire company will go broke’.”
“Out of fear, the CEO can’t let go. He freaks when your numbers are late (not on the fifteenth). He wants to know all the details about staff. He is a people guy, so he remembers names and circumstances and wants to know everything. He is nice, really, and he means well.”
What can I Do?
I asked them to reflect on what they, the managing team of the largest division of MM, said about their CEO. They didn’t get it at first. They asked: “You mean we shouldn’t talk about him like this? Should we not tell you how he’s doing the wrong things?”
But what I meant was: They made themselves dependent on the CEO. They responded just like their employees, shifting responsibility for the situation upwards, to their boss. They discussed how he should change. And they were probably right. But the most empowering question is:
How can I change? What can I do about this situation?
What do you think? In this post, we’ll continue this Organizational Culture Case, and you’ll learn what they did to change...
If you don't like fragmented reading, blog post by blog post, you might consider getting my eBook How to lead Positive Change with Culture and Positive Leadership that entails a more extensive version of this content.
Copyright © Marcella Bremer 2016. All rights reserved.