Like sociability, however, the relations that characterize solidarity have their dark side. Too much focus on the group's goals and requirements can be oppressive or hurtful to those individuals who get in the way. High-solidarity cultures can be positively brutal—for an extreme example consider ancient nomadic societies that were sometimes forced to abandon their old or infirm, including infants, to the mercy of the elements because caring for them would have impeded the search for food, and thus survival of the whole. Organizations can have the same do-or-die attitude. At Tystar, Andy Collins finished his first week by firing
two individuals who were getting in the way of profitability Much later, he came to find out that one of them was in fact not up to his job responsibilities. But the other had been performing poorly largely because she was struggling with the psychological fallout of a divorce. What she really needed was time off to recuperate; instead, Tystar left her to the elements. To his credit, Andy Collins tried to rehire the woman once he was the company's CEO, but she was by then employed by another firm. "I can say now that I'm glad you fired me," she told Andy when he called her, "because I learned I never want to work at a company that doesn't care about people who are hurting." In other words, she was a person who valued looking after others—one of the hallmarks of sociability—over solidarity's trademark performance-driven values and behaviors.
There, then, is a primer on the concepts of sociability and solidarity. Often, when we present these ideas, the first question people ask is: Are the two really mutually exclusive? Does a community—that is, does a group's culture—have to be characterized by either sociability or solidarity?
The answer is absolutely not. In fact, cultures rarely are. Instead, levels of sociability and solidarity fall along a continuum. Thus, a company can be high networked or low mercenary. It can be a mercenary culture on the cusp of becoming communal. Or it can be a networked organization suffering low morale and slipping into the fragmented quadrant. The Double S Cube provides a framework for identifying culture, but it does not intend to simplify what is undeniably complex.
Which leads us to back to the cube again. It posits that, in general, there are four cultures, or eight, if you include negative forms. By now, you have some familiarity with the concepts of sociability and solidarity, and you may even have a sense of your own organization's or group's place in the Cube. But before going any further, it's important to explore four major points that have emerged from our work with the Double S Cube—as it relates to business, work, and management:
First, a company can be characterized by one of these cultures, but most companies contain several cultures at once. Andy Collins's EmChem was a largely networked organization, with the culture cutting across most divisions and functions, but there did exist within it fragmented cells. In fact, the first gritty plant where he worked was characterized by extremely low levels of sociability and solidarity. This dynamic of more than one culture in an organization is common. You yourself might work for an organization where the head office is networked, the marketing division mercenary, and the poorly performing manufacturing section fragmented—but within manufacturing there happens to be one highly communal "skunk works" team. Indeed, given the different work done by varied parts of an organization, their different managers, different customers, and different competitive environments, a uniform culture is hard to find.
The international consulting firm of Booz Allen is an archetypal example. Generally speaking, the company is fragmented. It has more than ninety highly independent offices all over the world. Due to pure logistics, the majority of employees don't know one another, let alone socialize. Moreover, the company's consultants are motivated—that is, compensated—to find new clients and then focus intensely on the client's needs. This reality of the business does not lend itself to ruthless agreement on one set of company goals, strategies, or competitive approaches to business. Ultimately, as in many professional service firms— think of large law and medical practices—the most senior-level employees operate like independent contractors who primarily work for themselves and their clients. This culture is completely appropriate, and indeed effective, given the demands of the business situation. It remains one of the world's most admired and successful consulting companies.
But Booz Allen possesses other cultures as well. Its London office, with 150 people on-site, for instance, appears to be networked. Employees treat each other with respect and affability. New members to the firm are greeted with a tour and a welcom-
ing luncheon, co-workers chat in the hallways and pick up lunch for each other on busy days, and employees occasionally get together after office hours for dinner or parties. More telling evidence of the office's networked identity is that people are reluctant to leave Booz-London. It's an enjoyable place to work.
Interestingly, most of Booz's London-based professionals don't work for the London office—they only work in it. Most senior-level consultants are assigned to a "practice area," such as communications or health care, which cuts across geographical location. In other words, the health-care practice may consist of three consultants from the London office, one from Rome, seven from New York, one from Miami, and two from Munich. This disparate group of people must work together in a highly competitive environment to quickly and significantly advance the firm's knowledge in health care, land international clients, and manage such engagements. Again, by dint of logistics, sociability is hardly spawned by such conditions—conference calls and airport meetings don't lend themselves easily to conversation about children and vacations, let alone group participation in a triathlon. By contrast, the conditions are conducive to a singular focus on business objectives. Hence, one employee of Booz Allen could be part of three cultures at once: fragmented for the whole organization, networked for their office, and mercenary for their practice group. Is this arrangement easy or comfortable? For most people, it's automatic; it's all in a day's work. Yet, the fact remains that maneuvering among all the cultures you belong to is perhaps one of the great unspoken challenges of a professional career. 8
Second, our research indicates there appears to be a life cycle to the four cultures. Companies often start out as communal— that's not surprising given their size and the likelihood that the owner and founder is around to create a sense of high energy, clear vision, and deep commitment. In many start-ups, employ-
ees work closely in a fluid, exciting, and often intense environment—playing David against many Goliaths. That feeling of community rarely stops when the business day is over. Coworkers move from the office to a local bar or restaurant, where they continue to talk about business until they return to their apartments, only to see each other again on the weekends for softball (and more talk, often about work).
But no culture lasts forever. Leaders change, as do products, competitors, or whole industries. In other words, the environment changes, and the cultural response with it. In addition, as companies grow, they often move from the communal into the networked quadrant. The reason: It's very difficult to maintain a balance of sociability and solidarity in groups of more than a hundred (it's even hard to do in groups of more than fifty). As reporting relationships increase and roles differentiate—for instance, when marketing and manufacturing begin to employ very different types of people, with opposing views of what projects should get funded—the solidaristic aspect of the communal culture often weakens. In its place, you see a culture where a lot of things happen because of relationships. This high sociability is reinforced by the fact that communal cultures leave behind an attitudinal legacy. People assume they are going to be friends with their co-workers. They continue to socialize in the old ways. What diminishes is the shared sense of goals that is solidarity's defining hallmark.
After several years—even decades—the networked culture can backfire. Complacency can set in, particularly if Goliath has been slain. Poor performance is too often tolerated, and consensus building too often gives way to compromise solutions. Usually, it is an unexpected and harsh competitive assault that pushes networked companies into the mercenary mode. Simply to survive, the company is forced to fire lousy, fair, and even some "pretty good" employees, whether they are well liked or not, and rivet its attention on business goals and performance standards.
In the best-case scenario, such managerial changes steady the ship, and eventually, some measure of sociability returns, placing the firm either back into a more healthy version of the networked form or moving it over again to the communal. In the worst, such rearranging of the culture so damages trust and loyalty that both solidarity and sociability 'Tank/' creating a negatively fragmented organization.
Such was the case at the Boston-based market research firm described earlier. Due largely to its charismatic founder, who hired a bunch of high-energy outdoors enthusiasts like himself, it began its life as a communal company. In time, however, the firm segued over to the networked form, characterized by politics and in-groups. This worked for a few years, but eventually the majority of employees—those in the out-group—came to distrust and even dislike ''management/' Morale dropped, and revenues followed. Predictably, layoffs began, and a singular focus on business objectives became the order of the day. But the mercenary culture did not last long—mainly because the founder didn't enjoy it and quit, replacing himself with a manager from a competing firm. (Ironically, the new CEO tried to replicate the firm's communal culture of its early days, but the embattled, cynical, and overworked employees who still remained with the company would have none of it.) When we were called in to analyze the situation, the culture of the once thriving firm was fully fragmented. People barely spoke to each other to say hello, let alone discuss how to better serve clients.
Not all firms travel through the life cycle we've just described, of course. Some start in mercenary or even fragmented cultures and stay there ad infinitum. (We should note that starting in the networked culture is less common because sociability takes time to build.) But many initially successful start-ups do seem to arc through the four cultures in the order we've described. And for most it is not possible to languish indefinitely in the fragmented quadrant. Some bounce back into one of the other three quadrants, often due to the efforts of senior management. Some go
bust. Others are acquired and then, very often, the cycle begins again.
What's important to recognize here is that culture is a fluid commodity. In seeking to identify, understand, and change it, the course it has flowed over its history must be considered as well. This process is somewhat like trying to understand a family you've just met—or perhaps just married into. To identify and understand its underlying dynamics—that is, to comprehend what makes it function the way it does—you must assess current relationships and learn something of its history. The two pieces of information combined give you a complete picture of what the family is about, and why, that one alone can't deliver.
Third, not a single one of the four cultures—networked, mercenary, communal, or fragmented—is good or bad by definition. The cultures are only good or bad inasmuch as they fit with the competitive environment. When we introduce senior executives to the Double S Cube, many have the first impulse to launch a change program to move their organizations into the communal quadrant posthaste. It's hard to blame them. Who wouldn't want to run a company where employees, in equal measure, really enjoy working together and hate the competition? 9
But the communal culture is not always the right option for an organization. First, it happens to be a very difficult culture to maintain. The reason is simple: The behaviors that characterize sociability and those that characterize solidarity very often contradict each other. Communal cultures involve high levels of intimacy, respect, and kindness among their members—that's the sociability part—but their high solidarity also requires members to put the organization's goals first, even when it means shutting down debate or eliminating poor performers. Some organizations do manage to do both. It is a high-tension balancing act that requires careful, even exhaustive, management attention. 10
Perhaps this is why communal cultures often occur in small
companies with a charismatic leader who can model these often contradictory behaviors in one person. And along with small companies (or small departments or teams within large companies), this is why communal cultures often pop up in voluntary organizations, such as charities and religious institutions. With these groups, people only join when they already like the other members and are fully committed to the organization's espoused goals. It's a self-selection process most for-profit organizations find difficult to replicate.
Second, and more important for our discussion of the point here, is that the communal culture—like the other cultures in the Double S Cube—is effective only when it is appropriate for the work context and competitive situation. Networked cultures, as we noted earlier, can be powerful when the organization operates in a competitive situation that demands lots of flexibility and creativity. An advertising agency that serves the fashion industry offers a good example. It doesn't really matter if the agency's creative teams all agree that ROE must hit 12 percent within six months, for instance. Better that they feel their workplace is an open, accepting environment, where innovative, even off-the-wall, ideas can be shared, debated, and fine-tuned by supportive colleagues.
Networked cultures also are of enormous benefit to organizations for which a critical success factor is the free and open flow of information, especially across functional and geographic borders. Unilever, the international consumer products company with annual sales in the $50 billion range, is an ideal example. Unilever employees are renowned for their high sociability. This behavior can be seen in particularly high gear at the company's off-site retreat. Four Acres, in Surrey, England. There, Unilever managers meet not just for corporate programs or training events but also to socialize—to play pool and tennis, to drink, and to simply talk. Moreover, the company intentionally hires people with similar backgrounds, personalities, and values, thereby ensuring that the propensity to socialize will continue.
To outsiders, Unilever's culture may seem painfully inefficient—think of all those lost hours not spent behind the computer or out in the field with customers. But as the company has expanded globally, its carefully nurtured social networks have paid off in dividends quite literally It is not uncommon for a manager in Rotterdam, for instance, to pick up the phone and call a tennis partner from Australia to pass along information about an international competitor or a promising new distribution scheme. A manager in a mercenary organization might know who to call but wouldn't know the person well enough to place it, nor would he bother to take the time.
But it goes without saying that mercenary cultures have their place. Any company under competitive siege benefits from a kind of tunnel vision on priorities, goals, and strategies, allowing it to move quickly and cohesively. And even when there is not a competitive threat in the immediate picture, mercenary cultures can be enormously useful in improving employee productivity and performance. Finally, mercenary cultures are a good fit in industries where change is fast and rampant and senior management must respond quickly and decisively. In these situations, the time lost in debating, building consensus, and sustaining relationships can be catastrophic. Indeed, any culture but the mercenary would be ill advised.
Finally, we should note that as unpleasant as it may sound, the fragmented culture does have its advantages. There are some (although not many) business situations in which it is not only tolerable but desirable.
For example, fragmented cultures work well when there is little interdependence in work activities—think of subcontracting or outsourcing systems, such as those used by Benetton to make their fabrics and clothing in northern Italy, or common home- based work such as envelope stuffing. It is also an apt culture in situations where innovation or learning come mainly as a result of individual activities. Such is the case in some scientific research environments, when people are studying or experiment-
ing in areas where one can only work alone. It is not that low solidarity is in itself a good thing; it's just not relevant in these organizations. And, of course, the fragmented culture offers employees high levels of personal freedom—a major attraction for, say, a university professor or working parent.
Thus, the important message to remember is that no culture produced by the Double S Cube bests another apart from the competitive environment in which the culture exists. It is also important to note that two companies operating in similar business environments may have different cultures and still succeed. A perfect example of this dynamic is Procter & Gamble and Unilever. These companies make many of the same products, vie for the same markets, sell to the same retailers. Both have strong results. As we have seen, Unilever has many of the classic characteristics of the positively networked organization. In marked contrast, Procter & Gamble displays several features of the mercenary form. First, rewards are crystal clear, measurable, and linked to performance—there is no room for debate. Second, the enemy is clear—in each target market they deliberately identify who their key competitor is and close in on them with complete focus. Finally, structures are designed to deliver unambiguous accountabilities. When things go wrong the company knows who is responsible. Interestingly, recent changes at Unilever can be interpreted as an attempt to move in the direction of the mercenary quadrant. The company has been broken into fourteen business groups, each with its own clear agenda, accountabilities, and stretch targets. Under the new structure, according to a booklet sent to all managers, "business groups will make annual contracts on which they must deliver come hell or high water."
But why, you may ask, were these cultures different in the first place? The answer to that question lies in each organization's history and leadership, 11 which shaped its corporate character. It may also involve the matter of each organization's national cul-
ture and business traditions—P & G is an American company, Unilever is Anglo-Dutch.
At the risk of overgeneralizing, American organizations are more characterized by clear task focus, strong outer-directed- ness (a desire to control the environment—classically expressed in the American frontier spirit), and a spirit of meritocracy where the // race ,/ is open to all and the best win. In contrast, European organizations display more of a concern with relationships and process, social status and hierarchy, and long- established traditions. Finally, American organizations tend toward centralization—closely linked to solidarity—while Europeans embrace the ambiguities offered by decentralization.
In the final analysis, as organizations try to determine what culture best fits their competitive situation, they may find the answer is more than one of the forms in the Double S Cube. The challenges of the situation should influence their choice, but no one should discount the role of organizational history, leadership, and national culture as well. And finally, individuals may prefer to work in one kind of culture over another, but that's another matter entirely, which will be addressed in chapter 9.
Fourth, and finally, every culture can be functional or dysfunctional—that's why the Double S Cube is three-dimensional.
Thus far, we have mainly talked about each culture in its healthy form. But it is critical to note that both sociability and solidarity have the potential to generate behaviors that are not beneficial to an organization. Thus, the sociability of the networked form can mean friendships turn into cliques, and cliques turn into in groups, and information sharing turns into gossip and politicking. Similarly, the solidarity of the mercenary culture can be expressed within groups in ways that make cooperation difficult, if not impossible. When high levels of negative solidarity are in play, groups become so fixated on local goals that they may even
42 • THE CHARACTER OF A CORPORATION
attempt to undermine each other. And it is unlikely under these circumstances that people would suggest new approaches to business or seek to learn from each other.
At first, it is often difficult to judge when a company has crossed the line from functional to dysfunctional. But eventually—and sometimes quite quickly—the bottom line will let you know, for no dysfunctional culture produces excellent results for long. Case in point is Andy Collins's experience with Tystar. When he arrived at the company, it was a mercenary organization. Andy may not have enjoyed the environment personally, but he was right when he observed that you couldn't argue with the company's results. The mercenary culture was the right fit for Tystar's competitive situation—it faced tough competition from established players and it was expanding into new markets at the same time. But the company's management allowed Tystar's mercenary culture to slide down the slippery slope of unchecked high-solidarity behaviors. By the time Andy Collins was appointed CEO, the company had traveled through dysfunctional mercenary to dysfunctional fragmented. It's a wonder he had the courage to take the job.
Four points, one message: The meanings and implications of the Double S Cube are complex and subtle. Even though the cube looks technical and exact, it should not lull anyone into the false sense that understanding or changing culture involves precise processes or cut-and-dried solutions. Sociability and solidarity describe relationships between human beings, after all. Cultures come in many forms even within one organization, come into being for many reasons, and are evolving all the time.
Beginning with chapter 4, this book examines each of the cultures of the Double S Cube in their healthy and unhealthy forms. Later, it examines how managers can change culture, a daunting
Sociability, Solidarity and the Double S Cube • 43
and dangerous task even in the best of circumstances. And in our closing chapters, we will tackle the personal challenges of fitting into different corporate cultures, especially those that don't feel "right."
But first we offer a diagnostic process to help you identify the business culture or cultures in which you currently work. Indeed, you may already have a gut sense of where your company, division, or team falls in the Double S Cube, but the tests in the next chapter will help you make a more precise assessment. The results may surprise you.
3