Corporate Culture: Icebound? Or Breaking through?

Corporate Culture: Icebound? Or Breaking-through!

I read a good article suggesting that a CFO (newbie), should inquire among senior peer executives to ‘Bring out the dead’ during the second week on the job[i]. We can all agree there are benefits of learning what worked or didn’t; about disaster projects, and if they recovered. It’s part of a fresh forward momentum when starting in a new position. No sense reinventing the square wheel, right?

Then again, what if the firm’s management executives return a cold response? Or worse, you receive a line of defensive, politically charged rhetoric aimed at sinking any further investigation about the company’s history! Though these reactions are bewildering and add friction towards building camaraderie, you don’t have to stay Icebound… Certainly, chipping into that glacier of past financial misadventures can be challenging when the company veterans aren’t cooperating. Can you blame them? After all, who wants to admit to past failures? So, how does a CFO rookie navigate such resistance and breakthrough the ice?

First, it’s imperative to ensure the safety of your executive team to gain their trust. Though it seems colossal, a leader must, and can, develop an interdependent team culture. One that melts the internal faction issues like dissent and conflict … and creates safe passage to an authentic harmony. One solution is to apply the strategy of 'Constructive Conflict' coined by the late Mary Parker Follett. It encourages constructive debates, which lead to eventual consensus, developing fresh team skills and a higher level of commitment among the leaders[ii]. Changing destructive cultures at the top will in turn have a positive, linear effect on the subordinate corporate culture. Stay with me here, it has been done…recently.

Alan Mulally broke through the ice. He was the new CEO of the financially failing Ford Motor Co. in 2006, who immediately tried to initiate swift changes in a disintegrated Ford corporate culture. Executive meetings resembled tribal warfare and were plagued with “infighting and rivalry”, along with exhibiting groupthink behaviors like not speaking up or feigning a consensus[iii]. There were no candid constructive dialogues, only individualistic out-groups, symptoms which would be coined later as a “culture of No and Yes” [iv]. For instance, Ford executives would spend months arguing possible solutions on game-changing decisions ending in the only agreement of “No!” to do nothing. Or they would invariably agree “Yes” in the meeting but lobby in dissent afterwards down the hallway, determined never to resolve.

Mulally mirrored the ‘Constructive Culture’ principle and transformed Ford’s executives into a collaborative team atmosphere. How did he do it? In short, by developing a business plan review process. Each department executive was asked to bring to the meeting a color-coded progress of their area of responsibility. Green meant they were making progress, yellow stood for attention needed, and red was for alarming problems.

Weeks passed before the first, brave executive, who was head of North American operations, Mark Fields, came to the meeting with a red dot on the progress report, bravely announcing a problem with the Ford Edge vehicle production. Mulally responded with a resounding applause, reassuring that a constructive dialogue and a solution would follow to assist Fields.

More than just peer mentoring followed, the incident in the boardroom was retold so many times among management that the story resounded throughout the Ford culture… Until the previous destructive, competitive ethos, or philosophy, which had plagued Ford’s corporate environment was changed. Ford’s workplace now resembled what is described as “working together behaviors”, which was realized through Ford’s profits starting from a -$15 billion in losses in 2006 to gains of more than $8 billion in five short years[v] !!!

Clearly, there were other components involved, but the point is that changing a team culture is quite possible. Encouraging participants to reconcile opposing views can be as simple as responding with a “Yes, and how about this idea,” approach. True, a dysfunctional culture stifles innovation and growth, hurts team objectives, and leaves all progress still on ice. Using team building strategies, like constructive conflict and decision-making processes, can assimilate a team and turn cultural restraints into revenues. David Breashears, a Mt. Everest explorer, agreed, “if you’re trying to assemble a great team, don’t you want to hear their ideas?” I’d like to add that leaders are not “lone warriors” [vi] – they’re part of an executive unit. Cultivating a team by developing healthy, constructive debates and fostering clear communication can move a firm forward into a sustainable organization of success!

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[i] Secret CFO. First 90 Days as CFO. Retrieved on 8/21/2024 from: https://www.cfosecrets.io/p/first-90-days-cfo
[ii] Ibid page 11.
[iii] Manning, G. (Manning, 2014). The Art of Leadership (7th ed.). New York, NY: McGraw-Hill. Page 151.
[iv] Ibid page 17.
[v] Ibid page 20.
[vi] Roberto, Michael A., (Roberto, 2013). May, 2013. Why Great Leaders Don’t Take Yes for an Answer. Upper Saddle River, New Jersey; Pearson Education, Inc./FT Press, pages 11, 228.