Kevin,

I am a member of senior management at a fairly large company, and, currently, our company is going through some restructuring. I've been here for decades, and now I'm watching as other members of senior management are being replaced by "outsiders."

Now, I jokingly refer to them as such, but, when it comes down to it, part of me is afraid that the newer team members just don't understand the company's history to really understand and embrace the culture of our organization. They're all very intelligent- lawyers, accountants, accomplished businesspeople from all areas- so, I know we're in capable hands, but I do worry about losing a piece of our company that is so deeply rooted in the company's past, the part of the company's culture that has even become part of my own personal philosophy.

What will this mean moving forward? What part of a company's culture do we need to old onto for dear life? What parts can we let go?

All my best,
Maria Alaina

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Maria Alaina,

Thanks for your question on culture and company reorganization.

This topic has been debated for years as we examine how the new economy is being shaped by financial re-engineering of companies- some that are struggling and some that are doing very well!

Jim Collins addresses culture shifts in his book "Built to Last," which I'd definitely recommend reading during this time of transition. I think the same applies to those companies that have endured major changes inside and outside of their organizations, the ability to hold on to those core values that are "core" to the customer and product quality are really the key to enduring success.     

Sometimes, it takes someone from the outside to point out "the obvious" to a company's senior management team about their current business model. Over the years, some systems and resources have become focused on areas that add no value to the customer. This discipline is a real value that a private equity or v.c. can bring to the party.

Many times, though, in the name of cost reductions, product quality and customer loyalty are compromised in the name of driving down costs. This often happens because the time frames that many financial institutions work from are much shorter and may lead to a short term approach that can have a negative long term impact on the brand.

The balance of what to hold onto and what can be let go must be customer centric and product improvement driven. Once you bend those core values, then anything is negotiable... and that is simply not how great companies grow.

No matter who owns the company, the customer is still "queen" and should always be the guiding light to changes in any organization.

In closing, here's an exerpt from another book that could be a great resource to you, "Being the Boss" by Linda A. Hill and Kent Lineback:

Culture trumps everything else. Anyone contemplating disruptive change needs to play close attention to culture.  Culture is the infrastructure of a team; it enables productive work.  Get the culture wrong and nothing else is likely to work well.  The key components of culture are:  clarity about team roles; clarity about how the team works; clarity about how team members work together; and, clarity about progress.  A team’s purpose and goals, the future it’s trying to create, are the foundation of culture.

Thanks for your question. And best of luck with the tough decision that new management teams struggle with in this new world order in building their brands.

Live strong,
Kevin E. Dunn