Salz Review - Wall Street Journal

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181 Salz Review An Independent Review of Barclays’ Business Practices Culture is Experienced Understanding culture comes with the challenge that people typically have difficulty describing culture. We are conditioned to internalise and experience culture, not to speak about it. Conversations about culture have a tendency quickly to become nebulous. No matter how hard one tries to articulate what a culture is or is not, words rarely seem enough. Culture cannot really be understood without being immersed in it. This can pose a problem for executives who are used to studying phenomena at arm’s length through survey data and analytical reports. Observations and stories shared about culture typically take the form of descriptions of cultural signifiers such as signals and symbols, stories of what our cultural heroes have achieved and how they did it, and explanations of rituals and why they matter to an organisation and its members. These explanations give some clues to culture, but they are the ‘observable’ artefacts (see Figure B.2) of culture, which do not expose the basic underlying assumptions and value systems by which decisions are made. To get under the skin of culture requires subjective and shared experiences. For example, working with others to achieve a task or working through an organisational dilemma to experience how values are prioritised and judgments are made. It also requires the skill of ‘listening with the third ear’ 265 , a term coined by psychoanalyst Manfred Kets de Vries to describe the ability to listen for, and to make sense of and interpret, the emotional and intellectual experience of interactions between people. Culture needs to be explored through shared experiences, made visible and tangible through discussion about those experiences. Social validation is the process by which espoused values and beliefs become shared foundations of a culture. For example, if a manager’s response to a downturn in sales is to bring people together and to invest in creative thinking and innovation, a belief develops that innovation and creativity will resolve a downturn in sales. If the investment in innovation and creativity works, over time they will become shared values and ultimately shared basic assumptions (see Figure B.2). Only by experiencing and surfacing the basic assumptions can an organisational culture be truly understood. 266 Technology today plays an important mediating role in social validation. Online and physical communities have a different architectural base, but at the social level there are still people interacting with people. People can be as upset by a comment on Facebook as by a comment in a conversation. Social-technical systems arise when cognitive and social interactions are mediated by information technology. The capacity of the social-technical system to mediate social norms is increasingly becoming an important inhibitor or enabler of culture. Traders, for example, send millions of dollars to foreigners they have never seen, for goods they have never touched, to arrive at unknown times. Social-technical systems can generate enormous productivity; but for this to occur, system design must reflect cognitive and social needs. System usability drops when the system design contradicts the user’s cognitive needs. Social-technical design is a whole new paradigm for cultural engineers. 265 Manfred Kets de Vries, Are you feeling mad, bad, sad or glad?, INSEAD Faculty Working Paper 2007. 266 Edgar Schein, Organisational Culture and Leadership, 2006.
Salz Review An Independent Review of Barclays’ Business Practices 182 Figure B.2 – Organisation Culture Discussable Under the surface Artefacts Espoused values and beliefs Anecdotes, art, ceremonies, heroes, habits, jargon, languages, myths, physical location, rituals, stories, symbols, traditions Beliefs, cognitive processes, commitments, ethic, ideologies, justification, purpose, values, visions Underlying basic assumptions Assumptions, consensus, mindset, philosophy Based on Schein, 1985 At the root of culture are basic assumptions: every set of behaviours incorporates a view about the way that the world works. Assumptions give comfort: that these views mean we do not have to experiment or doubt. We can just act. Comfort is habit: over time the assumptions disappear and become ‘the way we do things around here’. Habits become institutionalised: a set of routines, procedures and rules which define us and give us identity. Technology plays a role in this. Identity is defended: everyone defends their identity. Culture creates stability, is reassuring and feels safe. Culture is a space where individuals can feel at home, a place where there identity can reside and makes sense. Paradoxically, a good culture needs to be challenged by its adherents to ensure that the assumptions upon which it is based are still suited to the environment in which the organisation exists. Additionally, those who join organisations need to decide consciously whether they can align and fit to the values of the organisation they join. Culture and Financial Services It is dangerous to make sweeping judgments about the culture of a whole sector in which there are multiple types of businesses – ranging from insurance to investment banks – and in which multiple subcultures will exist. However the analysis of the cultural challenge facing the whole sector would be meaningless without an attempt to understand some of the history, artefacts, beliefs and basic underlying assumptions which underpin our financial services sector and have led to the challenges faced today. A comparison of the description of financial services in the 1970s and 1980s by former regulator Brian Quinn, and the description of the last two decades of the 20 th century provided by financial historian Philip Augar provides a compelling starting point. Quinn describes the early years as “stable and clubby…in which risk taking was minimal and
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Salz Review - April 2013
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