Question: Changing a "crisis centered" company culture

I have recently joined a rapidly growing organization as its Chief Operating Officer. The company is very entrepreneurial, and values-driven.

While it rewards individuals who help it navigate through monthly recurring crises, it downplays the importance of prior planning to avert the crisis in first place. Consequently, the organization just lurches from one crisis to another.

As mandated by my boss, I am trying to put new systems and processes in place, but there is a lot of resistance from these individuals, even though they now technically report in to my position.

How can I work with them to drive these important changes?

8 Expert Insights

It has often seemed that people struggle mightily to secure budget approval for proactive endeavors like planning, process improvement, training and development, etc. However, there are never any budgetary constraints for a good old crisis. That goes for all the other scarce resources, too - time, talent, and management attention. So it's not hard to see how a crisis-centered culture develops: it gets rewarded.

In addition to access to resources, there is personal satisfaction for many in being a heroic crisis manager, so they get good at it. It seems at times those talents are being wasted in the absence of a crisis. We are all familiar with the concept of firefighters as arsonists - not a pleasant analogy to contemplate for workplace heroes.

Your task is culture change which is never to be undertaken lightly. Your heroes in the current culture may not see themselves succeeding as well in your desired culture. It will be important to develop a compelling business case for the change you want to see. Your boss is going to have to buy in and champion the change, especially when it comes to managing resistance. You will need to invest time and effort in facilitating a dialogue with your present-day heroes - they need to see what's in it for them. Last, but not least, you need to make it easier to do the new and harder to do the old way. That's easy to say, not so easy to do. Take advantage of current cultural strengths and use the entrepreneurial spirit and organizational values to both make your business case and reinforce the desired new behaviors.

Will your boss like completely changing the culture? This is critical. Unless the culture is changed nothing else will work.

Rewarding individuals who help navigate through monthly recurring crises is fine as long as they are given even more rewards for "preventing" them from occurring. this way they won't recur and the resources can be put into more productive pursuits.

Assuming the firm will actually embrace this significant shift in focus, start by conveying the 5 P's: Proper Planning Prevents Poor Performance. Go back to the firm's Vision, Mission & Values to set the tone; establish Goals as long, medium & short term and ties "rewards (financial & others) to achieving the goals in the pyramid.

I've been associated with many companies with a similar corporate culture: one that celebrates and promotes the individuals who handle crises very well. It's a great skill set - we call it the "fire-fighter" - while at the same time we bemoan the fact that preventing the same situation is extremely unlikely to be celebrated, since we never see the hypothetical "fire" when it never happened.

Prevention is the answer - a mind-set that seeks to anticipate what could go wrong and then puts systems in place to minimize the chance that failure happens. In the toolkit of process improvement and process management are techniques to do just that. The premier among these techniques is Failure Mode and Effects Analysis (FMEA), where a team of subject matter experts figure out all possible failure modes and categorize them quantitatively in terms of their severity, the potential frequency of occurrence, and the existence of systems to detect the failures before the customer suffers (or, in some cases, before the employee is harmed).  It's a quantitative way of analyzing something that's very subjective - namely, what can go wrong and what effect will it have if it should happen?

Organizations that adopt and encourage the use of such techniques come out ahead over the long run; they prevent the failures in the first place, and they learn from the failures that have occurred in the past. It is a discipline that is useful internal to a process improvement effort, but is often used as a stand-alone approach to address potential occurrences before they happen. Learn about this technique (it's in all literature related to process management) and have your leadership team encourage its use.

Please consider three concepts:

1) The "culture" is the employee’s most successful way of thinking, feeling and behaving.  The values (of your values-driven) organization reward those who "navigate recurring crises" over those who prevent them. The proper function of a culture is to resist change, thus the stronger the culture, the greater the resistance.

2) Management cannot DIRECTLY control how employees think, feel and behave, other than by coercion, which doesn't work very well.  Management can only create an organizational ecosystem (an environment) that calls forth the new values required to shift the culture in the desired direction.  This will be an ecosystem where it is safe for all of the voices in the system to be heard and performance expectations are openly negotiated (not imposed).

3) Your effectiveness lies not in the authority of your position but in your ability to influence, that is, gain Buy-in to a new constellation of shared values that reward the desired ways of thinking, feeling and behaving.  These new organizational values must be congruent with the values of the individuals you lead if you are to gain the required Buy-in.

A process grounded in these three concepts will take several months of skillful leadership to create the desired culture shift IF properly supported by the CEO; infinitely longer if not.

It seems like you need a new set of performance and process metrics.  I’d like to know what you have in place and what behaviors you are rewarding…or punishing.

Let me preface my comments by saying I don’t know the nature of the crises, the size of your company, the industry in which you operate or the products and services you sell.  Thus this response is based on hypothesis as much as experience.

CEOs must think outside the company.  He(she) is the public face and chief of sales, and chief executives often make the mistake of being too internally focused.  Kudos to your boss for recognizing this situation and bringing you on-board to improve operations.  As the new COO, I would be to sit down with the CEO and the CFO and do a thorough strategic review.  “Do we agree on where we are going and how we will get there?  Do we have the right financial structure in place?”  If the three of you are not in sync, you will not change your culture or solve your problem – You are doomed to make the situation worse.  When the C-Suite is aligned, share the vision and strategy with the rest of the company.  Be sure everyone understands it and how to execute it.  Next, develop a set of operating metrics that reward the actions you want.  Be sure you include metrics that reward PRO-ACTIVE behaviors.  Follow the old axiom, “What gets rewarded gets done, and what gets measured gets managed.”  For instance, if your crises are due to on-the-job injuries, measure “hazards identified / unit time.”  If the crisis is due to equipment failure or interrupted production, measure “missed inspections.”  You can also reward your team for better maintenance.  The same concept holds true for dealing with customer and client issues.  How is an account executive rewarded for visiting a customer that has zero problems?

If you are aligned on your vision and strategy and then you reward the behaviors to execute it, you and your folks will be well on your way to operational excellence.

Ask these simple questions of the "Crisis Team."

1. "Do you believe our customers would prefer that we consistently plan and put processes into place to prevent crises, or do you think they would prefer that we jump from one crisis to another to serve their needs? Would they continue to do business with us if they knew how we operated on a daily basis?"
2. "Do you believe that our investors (current or future) and/or future buyers would prefer that we are organized to deliver value without constant crisis management or would they prefer to know that we constantly operate in crisis mode but are very good at it?"

The answers to these questions will tell you a lot about the team and whether you want to be part of it. If they are not committed to working consistently on the systems and processes required to prevent the crises, you're in the wrong company.

Get out as fast as you can. Actions speak louder than words. Watch what they do, not what they say. Constant crisis management is the strategy of a lazy (and usually ego driven leader.)

One small idea. Implement "after-action reviews following major initiatives to discuss the question; "If we experience this in the future, how could we approach it in a way that improves efficiency or increases customer satisfaction." They may come up with the ideas themselves to prevent crises in the future.

It seems like you have a two pronged issue. First, you've been tasked with changing a culture. Second, the structures in place support the current "hero" or "cowboy" mentality.

The first task is for you to influence your boss and key people that report to you the value of having a culture that plans, prepares or works towards a future vs. fire fighting. There are hundreds of great business reasons to do this: lower rework; increased innovation; etc. Your job is to present a business case for why moving towards a new way of operating is going to benefit people.  

The second task, that can be done in parallel to the the first, is to redesign the structure of culture - performance management, hiring, leadership development, on boarding, etc. - to reflect the focus on thoughtful planning. Instead of rewarding someone for fixing a problem in production, reward people that test before production or that have no issues in production. Praise the behaviors and actions that promote the culture you aspire to.  The other side of that coin is to not stand for the "ready, fire, aim" mentality. When I joined Discover, it was an cowboy/crisis culture. People were rewarded for fixing issues that would have been avoided with better planning. It was a culture of late nights and burnout. We worked hard with leaders to alter the rewards, formal and informal, to focus on planning, thoughtfulness, smooth launches, etc. At the same time, we worked hard to promote planning. If there was a crisis in production or once something was launched we ruthlessly sought out the root cause. Not to point fingers, but to continuously uncover the power of planning and mindfulness.

All of this takes time and thoughtful action. It is about ensuring people know the new normal and then creating structures to support it.