culture club – Thoughts on instilling company culture
Leadership Key to Healthy Micro-Cultures
Corporate culture is typically referred to as a singular entity, but in reality, a firm’s culture often consists of micro-cultures that develop inside business units, branch offices, acquired companies, and project teams. These micro-cultures have only proliferated alongside the rise of hybrid workplaces since geographically scattered staff can feel deeper bonds to those co-workers they interact with daily on Zoom than to the overall firm. While these subcultures can undermine the broader corporate culture if not properly managed, studies have shown that micro-cultures can actually strengthen ties among workers and connect individual employees to the larger company culture.
Respondents to a 2022 global survey of knowledge workers and human resources leaders by the research and advisory firm Gartner reported that team-level experiences strengthened their sense of connection substantially more than company-wide initiatives. The Gartner study found that employees’ culture connectedness can increase by as much as 19% when achieved through micro-based experiences. Multinationals have long balanced strong corporate cultures with vibrant local micro-cultures. Dutch health and nutrition company DSM, for example, views itself as a flotilla of independently piloted ships rather than a single boat. According to Gartner researchers, “The company provides the flotilla with guidance to sail in the right direction, but it does not prescribe the norms and behaviors aboard each boat.”
Of course, micro-cultures can become exclusionary and cliquey if not properly managed, and studies have underlined the importance of strong department, branch office, and project team leaders to prevent this from occurring. An October 2023 working paper on employee misconduct revealed that middle managers are 2.5 times more important in predicting employee misconduct than company-wide factors. In addition, a survey of sales representatives and managers at 131 companies published in the July 2019 Quarterly Journal of Economics highlighted the dangers of basing promotions on individual performance instead of subculture health. Researchers found that firms were more likely to elevate “lone wolves” to sales management positions over candidates who displayed better collaboration skills. Those teams headed by the lone wolves were more apt to develop cutthroat micro-cultures, which resulted in 30% fewer sales than teams led by more collaborative managers who fostered healthy micro-cultures that synced with overall corporate cultures.
The next you – The latest on developing next-generation leaders
Wanted: Fluid Thinkers
Identifying internal prospects for future leadership positions presents an inherent challenge. Candidates are chosen based on potential—not proven capabilities as firm leaders. And as the winter 2018 edition of the Society for Human Resource Management’s People + Strategy Journal details, “Research indicates that a person’s current performance rarely predicts their future performance in different more complex, and/or bigger roles.” This can make internal leadership development an arbitrary, inefficient process, but neuroscience may hold the answer to more surefire succession planning.
Writing for Talent Management, cognitive scientist Phillip Campbell, CEO of global executive brain coaching company engimaFIT, identifies two types of intelligence: crystallized knowledge and fluid thinking. Equivalent to book smarts, crystallized knowledge is accrued over the course of a lifetime and accumulates with age. Campbell says crystallized knowledge is primarily a left-brain activity that is built upon language and prior experience.
Houston, we solved a problem
Fluid intelligence is the ability to reason quickly, think abstractly, and solve novel problems independent of previously accumulated knowledge. A classic example is the quick thinking displayed by NASA engineers to save the crew of Apollo 13 after an oxygen tank explosion crippled the spacecraft and imperiled the lives of its astronauts. Having no prior experience with the unique problem they confronted, the engineers relied on fluid thinking to cobble together a solution using adaptability and agility. Unlike crystallized knowledge, fluid thinking is primarily a right-brain activity. It peaks in young adulthood and declines with age, but it can be enhanced through neuroplasticity.
When evaluating internal prospects for future leadership roles, firms typically rely on past and current performance—in essence, crystallized knowledge. Not only is crystallized knowledge ineffective in predicting future performance, but the pace of technological change is further eroding its value. “The half-life of crystallized knowledge is rapidly decreasing, and AI/digital disruption will require faster and more agile leadership adaptation,” Campbell writes. “In the AI Age, leaders need to lift their game by being more adaptable and agile—the domain of fluid thinking.” According to Campbell, succession planning should incorporate an assessment of candidates’ fluid-thinking capabilities. This will identify employees who demonstrate flexibility and faster information processing, which will be critical in efficiently tackling unforeseen challenges.
Communications Corner – Ideas on connecting with your workforce
The Pitfalls of a “Culture of Niceness”
Walk the line
These days, firm leaders often feel they are toeing a fine line between delivering honest, critical feedback and being branded as “negative” or “toxic.” In trying to avoid the possibility of alienating employees in a tight labor market, however, some companies are avoiding the delivery of direct feedback, which presents its own dangers.
Safety is job #1
A decade ago, Google spent millions of dollars to study hundreds of its project teams to learn why some of them thrived while others faltered. “Project Aristotle” revealed a common thread among successful teams—a sense of psychological safety, which Harvard Business School professor Amy Edmondson characterized as “a sense of confidence that the team will not embarrass, reject, or punish someone for speaking up.” While it’s obvious how a workplace awash in toxic negativity could erode a sense of psychological safety, a culture of “toxic positivity” can produce the same result by preventing discussions of valid concerns and challenges out of fear of being perceived as negative. A lack of critical feedback leads to poor decision-making, unresolved problems, and the stifling of innovation.
Going to extremes
New York University psychology professor Tessa West told CNBC in a recent interview that concerns about being viewed as toxic have driven too many companies to the other extreme, creating “a culture of niceness where people don’t feel the psychological safety to talk about strengths and weaknesses.” She says, “We’ve somehow pitted niceness against clear communication and confrontation, even when it’s necessary.”
“The opposite of toxicity isn’t rainbows and sunshine—but a safe space for critical feedback and conversations,” West said. “Ironically, the biggest way to destroy psychological safety is through a culture of niceness because you don’t really know what anyone actually thinks.” The ability to deliver and receive critical, honest feedback is essential to improving the performance of project teams and companies as a whole. For tips on how to facilitate open and honest feedback inside your firm, read “Building a Culture of Feedback” from the AE Leadership Letter archives.
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