Ed Schein, a professor at the MIT Sloan School of Management, is one of the great names of management as well as one of its most original researchers. He worked with Douglas McGregor, Warren Bennis and Chris Argyris and taught Charles Handy and is generally credited with inventing the term corporate culture.
Career anchors are the things which keep people in organizations. An individual who finds his or her technical competence, management approach and way of working suitable to an organization is likely to stay with it because the individual’s sense of self-esteem is reinforced by the values of the company. There is a match between the individual and the company.
Since the values of the company inter-relate with the behaviors of the people in it, a strong sense of culture is created – the way we do things around here. In companies where strong career anchors exist, this culture is passed from generation to generation of managers, the senior teaching the junior, by example as much as by words. Schein points out that there are visible signs of culture – dress codes (often unspoken) and office layouts – and less visible signs such as stories about earlier managers which exhibit the values of the company.
Culture, and career anchors, can be good or bad. They can limit personal growth and prevent a company from exploring new avenues and behaviors. On the other hand, they enable people in organizations to work together, using the unspoken rules and mutual expectations. They reinforce behaviors that are approved of and so if a manager exhibits those behaviors, his or her way of working is constantly reinforced. Organizations that have strong cultures are often those that new recruits either love or hate, either join for ‘life’ or leave immediately. Obvious examples of organizations with recognizably strong cultures have included Ford Motor Company, Xerox, IBM and Shell – each different from the other. In each of these the observer would notice a common way of working, a way that may have felt odd to outsiders but which was not only accepted but valued by insiders.
Mergers and takeovers frequently fail – and one of the reasons that they may do so is that the original cultures of the ‘heritage’ companies, as they are often known today, do not match. Unfortunately, the presence of a strong and differentiating culture is not always or even often recognized by senior management, who may assume that the way they behave is ‘normal.’ Thus, they may have expectations of the to-be-merged culture which are not borne out in fact. Mergers and acquisitions affect the lives of people, not only because they may find themselves with a different job, boss or rank but also because they upset what Schein calls the psychological contract between the organization and the person. Behaviors that have been rewarded and valued may cease to be so.
Schein was one of the first people to diagnose culture and to point out that it was the role of the leadership to manage both the existing culture and cultural change. He identifies three distinct levels in organizational cultures; artifacts and behaviors, espoused values and assumptions
His definition of culture is:
“I concluded that the members unknowingly behaved in such a way as not to encourage risk-taking, openness, expression of feelings and cohesive, trusting relationships.”
A pattern of assumptions, invented, discovered or developed by a given group, as it learns to cope with the problem of external adaption and internal integration, that has worked well enough to be considered valid and be taught to new members, as the correct way to perceive, think and feel …