How a toxic working culture hampers your business
22 April 2016
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Hello and welcome to another edition of Old Mutual Live Business, my name is Chris Gibbons. I hope that you enjoy going to work every day, that your work is fulfilling, is rewarding. To say nothing of well-paid and you look forward to doing it all over again tomorrow.
For many people, work can be a living and that applies to people at the very top of the tree, just as much as those much further down. From the sea suite all the way down to the post room, to use an old fashioned description. If that’s the case for you, you have my sympathy.
One of the causes of this problem is very likely to be a toxic internal culture in your company. Ask just about anyone who has been involved in either management or the study of management. They’ll tell you that changing a company’s culture is one of the most difficult things you can do. When you think corporate culture, think about an iceberg. A little piece sticking out above the waves and a much bigger, far more dangerous chunk lurking beneath the waves. Difficult to see, difficult to avoid and as the Titanic discovered, ultimately deadly.
How do you set about dealing with a toxic internal culture? Maxine Jaffitt is Adjunct Faculty at GIBS, has been since 2004. She teaches on the PDBA and MBA programme there. She’s also a Scholar and Consultant in corporate culture and an Associate at the New York Consulting firm gothamCulture. Maxine Jaffitt, welcome to Old Mutual Live Business, thank you for joining us. Where does one begin, and let’s imagine first of all, that our listener is a member of the executive team, isn’t that where the power lies?
Does it start at the top?
Maxine Jaffitt: Absolutely Chris, if you consider that culture is multi-layered, multi-faceted. As you investigate culture, the real heart of culture lies with the assumption that founders and leaders and all those who come after them. Have about what it means to be successful and what it means to run an organisation.
Really, trying to interrogate and understand the culture is a deep process. It begins, of course, with the leaders who are, in fact, the embodiment of the culture. Even though they don’t realise it. Their behavior and who they are as people is the shadow of the organisation’s culture. Therefore it’s a difficult area to address unless there’s a willingness to embrace that.
CG: Theoretically then, the leaders should be aware of the companies culture at all times?
MJ: Well, yes, of course, but of course they are part of the leadership culture. Sometimes in certain organisations, the leadership culture is a separate culture to the other cultures in the organization. Because, of course, culture is not a monolithic kind of entity. There isn’t one culture. There should be an overarching culture and overarching value system, but what I see too often, the leaders are removed from the prevailing corporate culture. They live in their own world of what they believe is to be true.
When to do a culture check in
CG: Is this when we hear those magic words, ‘let’s do a culture audit’?
MJ: Yes, well, actually it doesn’t always come from the leadership suite, although it does frequently. The cause of that, or the reason people might want to engage in that is because they are finding it difficult to implement their strategy. Or that their brand external identity is not attracting the kinds of talent that they’d like it to do. Or somebody inside the organisation has told them that their culture is toxic. Or the culture, there’s many adjectives to describe the factors that influence a culture that is not working as well as it should. Because it’s an intangible asset. It’s often very difficult, as you so rightly say in your iceberg description. It’s hard to get your arms around what it is you’re talking about.
How to spot a toxic culture
CG: What would you say are the key, the hallmarks, if I can put it that way, of a toxic culture?
MJ: There are many factors that make up a toxic culture and I can really just talk to my own experience of working with different kinds of organisations. Firstly, as a result of a toxic culture, are significant, for example, you do have lower productivity. Lower morale, increased absenteeism.
But what’s more important, that it can be a cause of business failure. The first part of a toxic culture starts with leadership. Where leadership have no clear sense of direction, they have double standards, they’re authoritarian or bullying. Mostly when they’re inconsistent or hypocritical, they don’t walk the talk. Their espoused rhetoric and the lived reality are at odds with each other and that’s what people hear and see.
They see leaders saying one thing, but being or doing something completely different, which obviously leaves them fairly confused. I think the other parts of leadership has to do with their strong focus only on the negatives. So that leadership piece is really the most important piece. So to begin to understand a culture and why it may not be as strong as enabling as it might be, one really needs to start with those factors in leadership.
The second part is really a fear based culture where you’ve got high performance targets, little feedback and the constant threat of firing. There’s always this threat of firing that’s lurking around. Meaning that people don’t really have confidence in their jobs. They are motivated by fear and this obviously impacts productivity hugely.
A third factor might be lack of transparency or openness where people cannot speak their minds. They can’t raise issues and important issues are swept under the carpet. In that kind of culture where there’s a lack of transparency and openness, dishonesty and corruption is swept under the carpet and is not dealt with in an upfront manner.
Dealing with negativity
CG: How do you begin to start dealing with that, especially Maxine if the problem is the person right at the top of the organisation?
MJ: Well, it’s difficult to do that unless there’s enough of a critical mass of people who would like to investigate the culture in terms of achieving a strategic objective. In terms of understanding what people feel or think. What I see is often confusing is that people do climate surveys, which is a perception of how people feel. The perception and they call that culture survey. But culture is about looking at core assumptions and it’s a much deeper process of interrogation.
The Human Resources Department or the Head of Sales or another area of the business or the international partners in the business or other people who have a voice. Would like to investigate and diagnose and research the prevailing culture. When that happens, then one can begin to understand what it might be that’s holding the organisation back from achieving its objective.
CG: Does there come a point when the employee simply says, look, this is such an unpleasant place to be, I’m leaving, I’m out of here, I’m gone?
Driving employees away
MJ: I think if enough people who are significant do that, then of course that says something, but what is important about that is whether the MD or the head of the company gets to hear any of that kind of information. If it’s the kind of leader who is isolated from the realities of their business. Then that kind of information and the information regarding the reasons people leave, is not always well-known.
Unless they go to the press or they get a whole lot of other people to represent them. The mere fact that the leader knows why people leave and how many leave and some of the causes of this leaving, that in a way would give you an entrée into what’s possible and working with the kind of culture.
CG: But then fixing the problem also has to start right at the very top?
MJ: Yes, I think what most organisations struggle with is what do we fix. Where do we begin and I think there are people in organisations who know exactly what needs to be fixed. People, if you ask enough people and you interview and research enough people in the organszation, they know what is holding them back.
From being successful as an organisation because culture is the software if strategy is the hardware. It’s really what is holding you back from being successful as an organisation. To that extent there are areas that one can work on and it begins with a diagnosis of what is.
CG: So then it’s about talking to people, talking to people and really listening to them, not just pretending to listen to them.
The importance of communication
MJ: Absolutely and for that to happen you need to have an external or a neutral party who is investigating the territory. Because when you are in the organisation, you are of the culture. So it’s very difficult for you to be objective about what it is you are hearing.
I think one of the failures is that many companies do the culture research online or using digital or other kinds of media and I think culture is in conversation. The organisations are works of language and the culture is in the language, in the phraseology, in how the three letter acronyms in how people describe and analyse things. What is most important is that culture research is face to face research or conversations between people.
CG: This is the final question Maxine. I take it that having had these conversations and really listened, this is not going to be a quick fix.
MJ: Well, it’s not going to be a quick fix but what is important is very active researching and the very active intervening is already beginning to change the culture. Because as you begin to investigate it, so people discuss it and so things that were tacit become much more explicit. In so doing the very journey towards working with what’s possible is in motion.
CG: There we will leave it, Maxine Jaffitt of GIBS and gothamCulture in New York, thank you for having been with me on Old Mutual Live Business.
MJ: Thank you so much Chris, bye.