The Business Sensei

What Is Organizational Narrative?

This post is an excerpt from my upcoming book, Organizational Psychology for Managers.

Humans are pattern-matching creatures. We are built to try to make sense of our environment. Indeed, as more than one psychologist has observed, we see patterns even when they aren’t there! This tendency toward pattern-matching is a very powerful tool, though, because it enables us to impose structure on our environment. If we’ve done a good job of imposing structure, we can not only make sense of what is happening now, we can make reasonably accurate guesses about what will happen in the future. In fact, our ability to impose order and identify patterns is a big part of what enables us to think and plan strategically.

Culture, you will recall, is a device for making the world predictable. It tells us what to do when. Structurally, what we have is a narrative: in a certain situation these actions led to these results or these actions expressed these values, and that’s why we do things that way today. Quite simply, we impose a narrative structure on our own experiences and those of the organization. Consider how many of our metaphors reflect this view: “turning over a new page,” “starting a new chapter in our lives,” “taking a page from his book,” and so forth.

This narrative structure is so powerful that many people will ignore information that doesn’t fit the narrative: for example, there are still many people who believe that Humphrey Bogart said, “Play it again, Sam,” in the movie Casablanca. He didn’t, but he should have. It’s a much better line than the one he actually says.

This narrative structure helps us understand, or at least explain, our own lives: Elizabeth Loftus, a psychologist and Harvard professor, is also the world’s expert on memory. She believed that this stemmed from her experience of repressing her memories of discovering her mother’s drowned body in the family swimming pool. She later recovered her memory of the event and, over the course of a few years, the rest of the details came back to her. It made sense; it explained her fascination with memory. Then one of her relatives told her that she hadn’t discovered the body, her aunt had. Other relatives confirmed this. The memory expert had, herself, created a false memory and believed it because it made sense.

Organizational stories are most obvious in older organizations, be they corporations, religious institutions, professional groups, and the like. However, even small organizations, including start up companies, quickly develop their own organizational narratives. Indeed, the question is not whether you will develop a narrative, but who will do it. Will you define your narrative or will others define it for you? If you don’t define your own story, you can be certain that your competitors will be only too happy to do it for you. All too often, companies allow themselves to accept default stories about their business and then wonder why they are seen as “just like everyone else.”

Think about how often you’ve heard someone talk about your company’s “story.” We assemble incidents into chronological events and draw lessons from those events. The following three snippets play out in organizations all the time:

“Bob ignored his assignment to deal with what he felt was a serious problem and the boss fired him even though Bob was right.”

“Bob ignored his assignment to deal with what he felt was a serious problem. The boss saw what Bob did, and thanked Bob for saving the company money.”

“Bob stood up to the boss, the boss was going to fire him for insubordination, but the boss’s boss said, ‘Hey! Bob just saved the company a ton of money! What is wrong with you?’”

Each of these stories teaches a different lesson about how to behave. The first says never argue with the boss. The second says you should bring up problems. The third says that if you bring up a problem and your boss doesn’t appreciate hearing it, don’t worry, his boss will see that justice is done. I saw this one play out in just my first few weeks at IBM after I graduated from college. When Bob’s boss was subsequently reassigned to a remote branch office, that cemented the lesson that employees should act on serious problems.

The problem with most organizational stories is that they just happen. Events occur and are assembled after the fact into stories that current employees tell one another and pass along to new hires. These stories become part of the background, repeated often without really thinking about it. Frequently, the lessons taught to new employees are not the lessons management thinks are being taught. Taking control of the process, however, can dramatically improve organizational performance in all areas.

The Cultural Immune Response

This is an excerpt from my upcoming book, Organizational Psychology for Managers.

 

“That person might destroy our culture.”

I hear that line often in organizations, usually to explain why a potential new hire was rejected. The logic of it is somewhat dubious since cultures are extremely robust and do not accept change easily. Indeed, far from being damaged by a new person joining, the culture is more likely to change that person or drive them out.

When someone joins an organization, they need to come up to speed on appropriate behavior fairly quickly. A good orientation program can help with this, as we’ll discuss in chapter 8. The good news is that people tend to be tolerant of newcomers, provided they respond to feedback. In fact, what typically happens is that other employees will informally inform newcomers when their behavior is inappropriate. Provided the person appears to be attempting to respond to the feedback, their occasional lapses will be tolerated. However, should someone not respond to feedback, the intensity of the feedback escalates into a more formal process which may involve disciplinary action. If all that fails, ostracism often results. At that point, the person may then be fired or may quit because they feel they “just don’t fit in.” The culture has rejected them.

When a senior person doesn’t fit, however, the consequences can be more severe. Recall that leaders are viewed as exemplars of the culture; thus, when a leader fails to embody the values of the organization, this creates a great deal of confusion and cognitive dissonance. Cognitive dissonance is the unpleasant feeling we get when our actions and values do not match: for example, when the person who does not believe in violence loses his temper and punches someone, he may then feel a great deal of confusion and guilt along the lines of, “How could I have done that?” This will often happen even if the violence was objectively justified, for instance out of self-defense. Similarly, when employees are asked to follow a manager who violates cultural norms, they will often feel guilty or uncomfortable. They might seek to avoid that manager, passively resist instructions, perceive their job as inherently less interesting, and hence less attractive, become less loyal to the company, or even become depressed.

If the person who doesn’t fit the culture is the CEO, the problems are considerably worse. In this case, the reaction will spread throughout the company. Mistakes increase, motivation and loyalty decreases, and many top employees may leave. It also becomes harder to attract new people who quickly find the atmosphere oppressive: an organization filled with unhappy people is painfully obvious and not a fun place to be. Apple under John Scully and Digital Equipment Corporation under Robert Palmer are classic examples of this immune response in action. Apple, of course, eventually rejected Scully and brought Steve Jobs back in. DEC went out of business and was eventually bought by Compaq as employees rebelled against Palmer’s efforts to dramatically change the culture.

 

Balzac combines stories of jujitsu, wheat, gorillas, and the Lord of the Rings with very practical advice and hands-on exercises aimed at anyone who cares about management, leadership, and culture.

Todd Raphael
Editor-in-Chief
ERE Media

Systems, Silos, and Spaghetti

This is an excerpt from my upcoming book, Organizational Psychology for Managers.

 

Traditional systems engineering argues that we identify the key systems and then decompose them into progressively smaller systems. Thus, a helicopter might be decomposed into a flight subsystem and ground subsystem. The fight system can be further decomposed into a drive system and navigation system, and so forth. Eventually, we get down to the smallest possible subsystems and then start building them up again. Each system communicates with other systems through a predefined interface. This approach is quite common in engineering disciplines, from aeronautic to software. It is also a common approach with human systems.

Unlike mechanical or electronic systems, however, human systems rarely maintain clean interfaces. Human systems are porous. In small organizations, this can work very well, but can become hopelessly chaotic when the organization grows. The lines of communication between different organizational systems start to look like a plate of spaghetti. While it’s great that everyone is talking, the lack of discipline in the process leads to confusion and lost information.

On the flip side, when systems are tightly controlled, they can easily transform into silos. In this case, each group retreats behind its own metaphorical moat and interacts with other silos only through very limited channels. Organization members will typically express great frustration with the “bureaucracy.” The key is to develop loosely coupled interfaces, allowing for flexibility in communications without either chaos or rigidity. Accomplishing that requires understanding a number of different organizational components.

Consider a typical business: Marketing. Sales. Engineering. Human Resources. QA. IT. The litany of departments goes on and on. Every organization, be it a business, a non-profit, a church or synagogue, a school, a sports team, and so on is composed of a variety of moving parts, of departments and teams that themselves can be viewed as smaller organizations. The larger organization comes to life out of the interactions of the smaller organizations.

As anyone who has ever been part of a large organization, be it a corporation or a club, well knows, each subgroup in the organization is constantly struggling for resources, constantly trying to demonstrate its importance to the organization as a whole. Just as the larger organization is a complex system, each subgroup is itself a system, taking in information and resources and, we hope, putting out value to the organization as a whole. These systems all interact with one another, sometimes in very elaborate ways.

Even more important than the obvious and visible departments within the larger organization, though, are the hidden systems: how and why the organization does things, attitudes about success and failure, how the organization hires, fires, and promotes, beliefs about how mistakes should be handled, problem-solving and innovation versus blame, and so forth.

To understand the vortex of interactions between these systems, we first need to understand the organization’s DNA: its culture.

Understanding Organizational Culture

J. J. Abram’s 2009 Star Trek movie featured, as a major plot point, a good deal of back story to explain how the iconic Captain James Kirk became the person he was in the original series. What is interesting, however, is that when Star Trek first went on the air in 1967, the character of James Kirk was immediately recognizable to viewers: he was an exaggerated version of another famous military figure known for his heroic feats, charisma, womanizing, and connection to outer space. That famous figure was, of course, John Kennedy, and Star Trek was a product of the culture of the space race inextricably linked to the assassinated president.

How did James Kirk came to represent John Kennedy? What does that have to do with the vortex in your company or, indeed, organizational psychology?

Culture is an odd beast, most often described as “the way we do things around here.” This description has just enough truth in it to be dangerous. There is truth in the definition since culture is, on the surface, what we do and what we see. These obvious components of culture, what MIT social psychologist and professor of business Ed Schein referred to as artifacts of the culture, are also the most trivial aspects of culture. When we focus on the artifacts, we are missing the depth of the culture’s influence. Furthermore, we foster the dangerous illusion that organizational changes can be accomplished simply by making a few alterations to the way things are done.

 

Balzac combines stories of jujitsu, wheat, gorillas, and the Lord of the Rings with very practical advice and hands-on exercises aimed at anyone who cares about management, leadership, and culture.

Todd Raphael
Editor-in-Chief
ERE Media
http://www.ere.net