Salz Review - Wall Street Journal

Salz Review
An Independent Review of Barclays’ Business Practices
180
supplier of one organisation from another. According to culture expert Geert Hofstede,
organisational cultures differ mainly at the level of practices (symbols, heroes and rituals)
and as such they are more superficial and more easily learned and unlearned than the values
that form the core of national cultures. 263 A key challenge for leaders is to build cultures in
which values are embedded, stand the test of time and can challenge and shape (the
sometimes competing) deeply engrained national cultural values.
Researchers from across the globe agree that leaders and leadership behaviour play a
significant role in defining and sustaining organisational culture. Leading researcher, Edgar
Schein, estimates the impact of leadership on organisational culture to be considerable,
although variable, dependent upon the stage of development of the organisation. Leaders
as entrepreneurs are the main early architects of culture, but once cultures are formed, they
influence what type of leadership is possible and, if culture becomes dysfunctional (as a
whole or in part), the leader’s job is to speed up cultural change. 264 This belief is supported
by evidence from GLOBE. Given that the average tenure for CEOs is decreasing, it is vital
that leaders not only understand their role in cultural creation, maintenance and
reinforcement, but also that they become skilled as cultural engineers.
Entering a profession (or industry) comes with the expectation of holding certain values
and convictions and of learning new skills. As shared experiences and learning underpin
cultural development, it is unsurprising that professions contribute to, and are often found
to be, a mediating factor in the development of organisational cultures. Professions that
have demanding learning and continued professional development criteria typically develop
stronger cultures than those that do not. Reputation and success in these professions are
strong stabilising influences. Professions, and to some extent industries, have language,
symbols, rituals and heroes that signify the culture of the profession. Associating with a
particular profession sets an expectation to abide by certain rules of interaction.
Professions and industry bodies, when they do their job well, act as a mediator and culture
carrier, promoting the best behaviours and controlling the worst. Professional cultures are
typically experienced as sub-cultures within an organisation. So in a Universal Global Bank
it would be natural to expect different cultures amongst those trained as investment
bankers versus those that have learnt their trade in the Retail Bank.
Schein argued that in any organisation there are a minimum of three sub-cultures at play:
an executive sub-culture, an operator sub-culture and an engineering/design/professional
sub-culture. Each sub-culture demonstrates distinctive patterns of interaction. For an
overarching organisational culture to function effectively, it must align sub-cultures
through overarching organisational values that help manage the natural tensions that arise.
Perhaps the most notable influence in developing an over-arching organisational culture
lies with how people progress from being a leader of a business unit to executive leadership
of the organisation as a whole. Because cultural patterns are enduring, if insufficient
attention is paid to the transition to the executive function, professional sub-culture beliefs
and behaviours are likely to be carried into the new role. Transition implies new shared
learning; learning the role of the executive and establishing appropriate models of executive
leadership are vital in order that sub-cultures are not able to exceed that for which they
were designed.
263 Geert Hofstede, http://www.geerthofstede.nl/culture.
264 Edgar Schein, Organisational Culture and Leadership, 2006.