Organizational culture.

By Simmons, Linda C. Publication: Mortgage Banking Date: June 1996

As an observer of what makes organizations successful, I am always looking at publications and talking to others to catch trends and shifts in the business. The notion of "organizational culture" has received much exposure during the past month - a certain sign that further scrutiny is warranted. Discerning the organizational culture is a first step toward understanding many attributes of the organization, including its most important quality - performance. In addition, the positioning and location of the multiple layers in an organization's culture affects performance. Over time, I've learned that an organization's culture is much like an artichoke - a unique shape that is both tough and tight on the outside, protecting layers of gradually softer, more robust leaves that give way to the real measure of a good artichoke - the heart. The arrangement of the leaves, as well as the number of layers, is very important to the ultimate measure, and has many parallels to the mortgage banking business. Learning to peel the cultural artichoke can be quite informative and even tasty. What are the first things you notice about the cultural artichoke? What forms the outer layer of successful mortgage companies? What first comes to mind is a combination of charisma and leadership actions. The actions of the CEO and the way the leader's assumptions, values and beliefs are communicated create a powerful message. In this industry, we know who the leaders are because we see them, we hear them and we know them. These successful CEOs do not reside just in their office, but are visible in operations and special events, making the important announcements, and are a serious role model for the majority of the company. Closely associated with leadership actions are the strategy, vision and purpose of the company. Whether these concepts are abstract or well-communicated philosophies is quickly discernible. For instance, a visit to a Disney theme park evokes a clear understanding of Walt's original vision. A ride on Southwest Airlines is a ride with Herb Kelleher. A conversation with a CEO who is strong on these attributes paints the company picture and prioritizes one's future - in five minutes. A conversation with a CEO short on any of

these dimensions is sure to precede the revelation of cultural disarray. A muddled vision precedes a muddled culture. A purveyor of good artichokes could tell you right away the size and weight of the best. The purveyors of success in this industry also know what performance features are important and clearly communicate them as part of shaping the culture. Are decisions and behaviors rewarded for short-term thinking or long-term success? Are economies of scale the bottom line, or is it profitability? Are group goals emphasized, or is individual contribution more highly valued? Along those lines, a fourth dimension of a well-shaped cultural artichoke is how employee treatment aligns with the stage set by the leader. Are the right people hired, trained and rewarded appropriately? Do adequate opportunities for advancement exist, and are mentors encouraged? What are rewards based on? Further, does the organization's structure complement employees' potential and talents? How well does the infrastructure allow an organization to focus on the ongoing need for innovation and collaboration while still coping effectively with day-to-day functional demands? The clues are easy to spot. Are people excited about their work? Having the answer to "Who are we?" and "When do we fit into the industry's infrastructure?" throughout the organization goes a long way in defining the culture. How well does one "know" this company before ever visiting it? Is the company's message clear to everyone? For a business that has been surprising us for a long time, would the casual observer be surprised at who the leader considers the company's true competition? If cultural contours such as leadership actions, vision and strategy, performance measures, employee relations, structure and a clear sense of "who am I" guide one to what appears to be successful on the outside, what should one look for within? Many years of conducting performance studies have permitted me access to a wide array of production and servicing operations and empirical investigation of this concept called "culture." Using the scientific method, a visitor can form some pretty meaningful hypotheses that seem to determine fairly reliably an organization's culture. What a customer or visitor sees (and remembers) from entering the facility along with the hum and highlights of activity are indicators of core values, or what qualities are considered worthwhile. How accessible is the operation (and hence available for assistance)? Do I feel like a visitor or a potential invader? How long do I wait? Once inside, forms of recognition posted on the walls and evidence of celebrations send messages about what is important. Progress charts for significant projects, a collection of

semi-formal awards decorations and a Mylar balloon serve as symbols of a satisfying culture. While the physical layout provides some indication of the organization's climate, observing how people interact in getting their work done is as important a climate gauge. Although the movable cubicle is ubiquitous in the industry, how is the sense that this is a good place to work conveyed? What are company norms? With the movement toward business casual, did decision makers still distinguish themselves visually at work? How full was the parking lot first thing in the morning (or at 5:01 p.m.)? What is the sense of urgency for getting things done? Unless a company is new, and sometimes even then, something in writing has emerged that depicts the organizational philosophy. It could be a plan with a mission statement or a surrogate declaration in the form of a management report. Just as revealing as the written statements are conversations at all levels of the organization, where individual beliefs are affirmed and indicate whether the organization's philosophy is even known, much less subscribed to. The best empirical evidence, however, comes together in the last five minutes. As one leaves, is it clear what behaviors surface from this culture? Is there a company heartbeat? Is there a passion that makes one want to come back? Is it clear how decisions are made? When prospective projects are described, does one see blue sky or a freeway? How many people are involved in a decision? Are the top priorities clear and the time frame evocative of decisiveness? Does one have a sense that the employees trust where they are headed? And then to the heart of the matter: performance. Not surprisingly, all these characteristics that shape and depict culture make it multidimensional. The artichoke leaves and culture have to be both strong and fit to produce the best result. In the former case, that result is an artichoke heart. In terms of companies, the result is superior performance. When one thinks about the performance of the industry's leaders, isn't that what they've done? Have they not cultivated a great artichoke?