Interestingly, one of the ways this fairness dynamic plays out in mercenary companies is that hierarchies tend to be flat. This isn't to say that the CEO and a new MBA sit down to lunch together. It means instead that the company has eliminated unnecessary layers. It has not eliminated authority In fact, mercenary
cultures are very clear about lines of authority In some, senior managers are still referred to formally, with Mr. or Ms. preceding their surnames. But many mercenary companies also use the leveling device of calling all employees "associates" regardless of where they fall in the hierarchy. One way of interpreting this approach to titles is to see it as a tool for self-esteem. "I'm not a truck driver," someone at Goodyear Tire (which uses the associate title) might reason, 'Tm an associate. That sounds more important." This is only a small part of the point. Mercenary cultures primarily use the term associate to reinforce the company's sense of shared purpose—and responsibility. "I'm an associate. I'm part of the company. I can make a difference and I must."
The last rule of survival within a positive mercenary culture is. Don't overbrain it. This is somewhat akin to saying accept fast change—don't think about it too much. And don't just accept change—embrace it. Mercenary cultures often evolve in industries or companies where competition is fierce and rewards for victory are large, such as investment banks, retailing, and hotels. People who can't move quickly—that is, get orders and act on them—don't fit with the mercenary culture. You have to have a certain love for motion to survive in the mercenary environment.
What this means in real time is that members of mercenary cultures have relatively high comfort levels around disagreement, conflict, and risk. This has partly to do with the underlying assumption of shared interests; the form's lack of sociability also takes the personal out of debate and disagreement. It's just business. This does not mean that mercenary cultures can tolerate chaos or ambiguity. In fact, it disturbs them. (By contrast, the networked and communal cultures excel at this; their high sociability provides an anchor during the storm.) In mercenary cultures, however, people seek to air differences and resolve them and then move forward swiftly.
The evolution of one of America's major banks, Citicorp, cap-
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tures many of the classic characteristics of the mercenary culture. Under the leadership of George Moore and Walter Wriston, a "sleepy" provincial bank—First National City Bank of New York—was transformed during the 1960s and 1970s into a major aggressive international player. They were driven—as many mercenary cultures are—by a clear view of the enemy. As "outsiders" they were motivated by the desire to beat the patrician blue bloods who dominated the banking business. 5
Against this background the modern Citicorp culture has developed many of the features of the mercenary type. First, a restless impatience to deliver clearly defined goals. Second, a meritocratic reward system that placed high value on individual achievement. Third, an open and direct approach to problem solving. Some insiders believe that these characteristics may have been taken too far over recent years. For example, the company developed a strong reputation for attracting highly talented people who, in the words of one insider, sometimes "beat each other's brains out." Another suggests that "they eat their children and thrive on it." Yet the company retains its high levels of solidarity and its belief that "they are the best." The cost may be that employees bond through "sharing hell." Meetings, for example, are notoriously confrontational and have been described by insiders as a "series of barroom brawls." Some joke that they prefer Citicorp to its more networked competitors because at least at Citicorp you get knifed in the front! (Interestingly, although the company retains its strong performance- driven culture, the recent development of a "Citiway" value statement stresses the need for employees to balance work with wider life commitments.)
Perhaps the essence of Citicorp's no-nonsense focus comes from the following anecdote, which contrasts doing business at Citicorp with one of its patrician competitors. "At Citicorp you leave the client waiting in a large open-plan area, give them a cup of coffee in a plastic cup, start the meeting late, and get straight to the business. At the competition, you would sip Earl
Grey tea from a bone china cup whilst waiting in a room bedecked with expensive art and tapestries; you would be taken along a paneled corridor covered with Persian carpets to another room where it would be explained to you why they could not do business with you."
DANGER: LIVE WIRES
The negative form of the mercenary culture can be characterized by restlessness and ruthlessness. Like live electrical wires these qualities should only be handled by trained professionals. The same could be said of the other characteristics of high solidarity—focus, energy, hatred for the competition, and a fixation on goals. Taken to extremes, all can become forces of destructiveness, both organizational and personal.
Get to work on Saturday is one of the rules of this quadrant. When one executive offered this advice during our first session with a company, another at the meeting jumped in and said, "No, get to work on Friday." It only takes a small step off the path to turn driven, competitive, intense people into—in the words of one veteran of this form—"selfish, reckless bastards." Mercenary cultures can turn heartless, even mean. When someone gets fired for poor performance, you don't hear, "It was a shame we had to let Howard go." You don't hear anything at all. The assumption is that the person wasn't up to par and that he had to be eliminated. There can even be a certain gleefulness about some one else's failing, as if with his candle dimmed, every one else's glows more brightly.
In a negative mercenary culture, the enemy isn't just outside, it's inside as well. Because of an obsessive focus on measured outcomes, people who don't "deliver" may be considered useless. At its worst this can lead to an almost inhumane treatment of others. A woman who worked for a major American retailer told us her story. (When you've heard it, you'll know why we
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THE CHARACTER OF A CORPORATION
are not naming her or the company.) She was just out of business school, and as she learned the ropes at the new company, she missed her first-quarter targets. When her boss called her in to discuss her performance, the woman admitted that she didn't yet fully understand the company's strategy. The boss spat in her ear and told her to clean her ears out. (The implication being, of course, that she hadn't listened properly.) The woman lasted a couple more years and learned to survive in this culture—but it was never fun. But once she left, she felt enormous relief, almost as if she could breathe again.
In a positive mercenary culture, the clarity of goals and competition keeps people focused on winning. In the negative, hitting targets is all people think about. They get tunnel vision. Worse, their behaviors are riveted on maximizing short-term goals, whatever the long-term consequences. Yes , I'll hit 20 percent ROE by June by pushing product out the door , the thinking might go. Let the people in manufacturing and customer service worry about the quality problems I've created.
This hyperfocus on the short term can also play out as a lack of communication between teams, departments, and functions—a Focus on your own bit and damn the others ethos develops. Indeed, cells of mercenary cultures or individuals come to care about their own performance and careers and no one else's. They sometimes even lose their interest in the company's overall performance. After all, why bother brainstorming about the markets, or potential products, or creative approaches to work when there's no immediate reward in it? In very negatively mercenary cultures, in fact, one sees the so-called silo effect, in which parts of the organization stand like so many grain silos on a wide farm field, forever separate and parallel to each other. Mixing the grain of one silo with grain from another might create a fantastic new type of bread, but it would never happen.
When people care more about their own goals and careers than the collective good, another thing happens: they get very defensive. Some people even become devious. The reason is that as
high solidarity becomes localized, the competition becomes internal—the enemy isn't outside, he's down the hall. The marketing department comes to demonize the manufacturing division, or the business units come to make villains of headquarters. To win this game, people work hard to keep something up their sleeves—a card to play, if you will. The card will move them or their group forward. And therein lies a key difference between the negative and positive forms of the mercenary culture. In the positive, the card would move the organization forward. In the negative, winning is no longer about us. It's about me or my group.
Needless to say, the negative form of the mercenary culture is never appropriate in business although it can emerge all too easily. (As we discuss later, some of the infighting can be reduced by reminding employees of the collective purpose and common enemies.) But the positive form can be uniquely powerful in certain environments.