Culture starts at the top

2014

When Saturday Night Live opens its show with a parody of your Company’s senate testimony, you know that you have a major perception crisis on your hands. General Motors CEO, Mary Barra, and her leadership team are clearly exposed. But how did GM get to this point? A good place to start is to examine the corporate culture that led to the situation and underpins the whole ignition switch debacle.

As more facts emerge, we’re starting to get a clearer picture of the culture at GM. And it’s not a pretty sight. A culture in which is seems to be acceptable for key decisions to be made lower in the organization by ill-equipped managers driven by cost-cutting, where it’s OK to deceive to make a buck and where evasion of responsibility is tolerated all the way to the top. None of these are good messages to send deep into an organization, especially one that needed a government bail-out a few years back in order to survive competition from abroad.

This type of behavior doesn’t just affect trust in and within an organization. It also crushes productivity, morale and communications. How might this shake the employee base? Here are some of the ways that it will likely manifest itself among the GM workforce in the weeks and months ahead:

Employee productivity and performance will suffer: Productivity and output will fall whenever there is doubt, suspicion and fear in the workplace. This is an unfortunate result of worker’s time and energy being spent looking over their collective shoulders rather than focusing on the work at hand.

Pride in craftsmanship will diminish: Mistrust diverts attention away from the little details that are required to produce and deliver high quality products and services, the sort of things that someone can take pride in. Consequently, morale will suffer, too.

Union relations will be damaged: The UAW already mistrusts management. Now, it has a very public reason to continue to promote mistrust among its ranks. Relationships will become strained and communication, grievance arbitration, contract interpretation and negotiations will become even more tense and uncomfortable as a result of the current situation.

But, all is not lost, of course. Like people, organizations can change if their leadership is deliberate and determine to do the heavy lifting necessary to transform. Here are some strategies that GM’s leadership team could adopt that would make a difference:

Model desired behavior: It is absolutely critical that Mary Barra and her team model the behavior that they want to drive into the organization. It is will not suffice to say one thing and do another; that will just lead to more deceitfulness across General Motors. Rather, the leadership team must strive to be a living example of decency in all that they do and assume full responsibility to right the situation and not appear evasive or disingenuous as they right the ship.

Establish a “No Spin” Zone: The leadership team at GM must re-establish an environment where only facts are discussed and the truth is told. They must create a virtual “No Spin Zone” within the enterprise they are charged with leading. It is merely a matter of good business to tell the truth and nothing but the truth about the issues that are affecting their organization.

Institute an Outside-In Perspective: Had the culture at GM been one where questions like “What would my customers want me to do in this situation?” were routinely asked, GM may have avoided this whole catastrophe. An outside focus creates a work environment that puts customer interests ahead of the parochial interests and petty in-fighting that tends to characterize low trust work settings.

To close, trust is good for business. High trust work settings are efficient because their focus is on the outside and delivering on promises. It is not on the inside and managing the “spin”. What’s more, high trust businesses are resilient, too. So GM needs to establish trust, right now.

Mary Barra and her senior team must rebuild the trust that was lost and provide the company and all of its stakeholders with the strength needed to overcome its current adversity. She must pull together the people of GM and address head-on the challenges at hand without making excuses or false promises.

I hope that she surrounds herself with the type of people that can make the difference and keep her and GM from further public scrutiny. Though, I must admit, the SNL spoof was a lot of fun to watch.

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About The Author

James M. Kerr
James M. Kerr

James M. Kerr is the Global Chair of the Culture Transformation Practice at N2Growth and the author of The Executive Checklist. A specialist in organizational design and cultural transformation, he has been helping clients re-imagine the way work is organized and performed for more than 25 years. Kerr’s next book is due out later in 2016 and focuses on leadership and strategy-setting.