Don’t Confuse Corporate Culture with Tradition

HSBC

We are connected to the past, but are not defined by it.

Many companies are proud of their heritage and company traditions.  HSBC is 150 years old this year and planning multiple celebrations focused on its long tradition of supporting economic growth and wealth creation.

ChevronChevron, the global oil company, was founded in 1879 and is proud of its history and traditions:

“Our company has a long, robust history, which began when a group of explorers and merchants established the Pacific Coast Oil Co. on Sept. 10, 1879. Since then, our company’s name has changed more than once, but we’ve always retained our founders’ spirit, grit, innovation and perseverance.” (Chevron website)

In many ways, nearly all companies use the legacy of the founders and their early values to help build pride, define who they are and to differentiate them from their peers. While start-ups have energy, passion and a future vision, established organisations have their history and legacy as well as a future vision.

But one of the many mistakes established and successful companies make is to confuse tradition and heritage with corporate culture. Many companies describe it something like this:

“Our heritage and long history of success are the foundations for our high performance culture today.”

More often than not that is just another example of corporate spin, otherwise known as BS!

Culture has very little to do with history and legacy and more to do with the day to day routine behaviours that management and employees use to solve problems and the current policies and procedures that everyone must adhere to.

Slide001In my book, LEVERAGE: The CEO’s Guide to Corporate Culture, I make the point that while founder values and leadership actions may be strong in the beginning, as a company grows the impact of leadership and history on corporate culture gives way to the peer pressure found in local subcultures  inside the company. And since there is no single corporate culture, but instead most large companies are a collection of strong subcultures, history, heritage, tradition and legacy values may have little to do with how the modern company actually behaves.

Banking is an excellent example.  The rise of strong trading and investment banking subcultures have completely overshadowed the values and legacy of the early founding fathers.

For companies such as HSBC to attempt to reshape their currently dysfunctional corporate culture by focusing on heritage and founding values is a design to fail.  They should use the millions of dollars spent on their 150-year celebration to take an honest look at what really drives their current culture and performance.

Written and Posted by: John R. Childress

Senior Executive Advisor on Leadership, Culture and Strategy Execution Issues,
Business Author and Advisor to CEOs
Visiting Professor, IE Business School, Madrid

e: john@johnrchildress.com
Twitter @bizjrchildress

Read John’s blog,  Business Books Website

On Amazon: LEVERAGE: The CEO’s Guide to Corporate Culture

Read  The Economist review of LEVERAGE
Also on Amazon:   FASTBREAK: The CEO’s Guide to Strategy Execution

John also writes thriller novels!

About johnrchildress

John Childress is currently Visiting Professor in Strategy and Culture at IE Business School in Madrid and a pioneer in the field of strategy execution, culture change, executive leadership and organization effectiveness, author of several books and numerous articles on leadership, an effective public speaker and workshop facilitator for Boards and senior executive teams. In 1978 John co-founded The Senn-Delaney Leadership Consulting Group, the first international consulting firm to focus exclusively on culture change, leadership development and senior team alignment. Between 1978 and 2000 he served as its President and CEO and guided the international expansion of the company. His work with senior leadership teams has included companies in crisis (GPU Nuclear – owner of the Three Mile Island Nuclear Plants following the accident), deregulated industries (natural gas pipelines, telecommunications and the breakup of The Bell Telephone Companies), mergers and acquisitions and classic business turnaround scenarios with global organizations from the Fortune 500 and FTSE 250 ranks. He has designed and conducted consulting engagements in the US, UK, Europe, Middle East, Africa, China and Asia. Currently John is an independent advisor to CEO’s, Boards, management teams and organisations on strategy execution, corporate culture, leadership team effectiveness, business performance and executive development. John was born in the Cascade Mountains of Oregon and eventually moved to Carmel Highlands, California during most of his business career. John is a Phi Beta Kappa scholar with a BA degree (Magna cum Laude) from the University of California, a Masters Degree from Harvard University and was a PhD candidate at the University of Hawaii before deciding on a career as a business entrepreneur in the mid-70s. In 1968-69 he attended the American University of Beirut and it was there that his interest in cultures, leadership and group dynamics began to take shape. John Childress resides in London and the south of France with his family and is an avid flyfisherman, with recent trips to Alaska, the Amazon River, Tierra del Fuego, and Kamchatka in the far east of Russia. He is a trustee for Young Virtuosi, a foundation to support talented young musicians. You can reach John at john@johnrchildress.com or john.childress@theprincipiagroup.com
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