A periodic newsletter devoted to bridging the gap between social science

and mythology on corporate culture, leadership, and change.

5-7 minute read, with links to interesting stuff.

(above: stonework detail from the Alhambra, Cordoba, Spain)

photo credit: wsj.com

From the Department of They Said it Better:

(Note: We are devoting this entire New Year’s edition to the story of what happened at Southwest this past December as it is timely as well as illustrative of challenges with corporate culture. It's a more focused read and a bit longer, but useful, we think, for leaders and practitioners).

On the 21st of December, 2022, at the peak of the Christmas travel season, a “bomb cyclone” hit Denver Colorado, one of Southwest Airlines key network cities (Southwest Airlines is the second largest US carrier by market share and fourth largest by passengers carried in North America)(1). Due to the severity of the storm, ground crews were unable to get planes into gates fast enough to unload and refuel, causing massive ramp back-ups and flight delays. To deal with this the airline instituted a mandatory overtime rule which forced ground crews to work in extreme adverse conditions, which resulted in approximately 150 ground staff walking off the job and many others calling in sick, upon which Southwest declared anyone who called in sick had to present a doctor’s note or face termination (Southwest denies this).

Terrible weather was the catalyst, but the shortage of ramp staff led to flight cancellations that cascaded to multiple cities. The number of cancellations wreaked havoc on flight crew scheduling. Southwest's early 1990s software system that matches crews to aircraft was overwhelmed and crashed, forcing manual scheduling, an impossible task given the number of variables involved between aircraft locations, flight crew availability, and very prescriptive federal regulations sanctioning crew duty time and mandatory rest periods. All of this was not helped, of course, by Southwest’s point-to-point network, which, like a railroad, quickly spreads disruptions in one station to all others connected on the same “line” (anyone who has flown Southwest in the evening has experienced this first hand: evening flights are usually delayed because of issues earlier in the day).

The end result was nearly 16,000 canceled flights.

Hundreds of thousands of passengers were disrupted for upwards of 5 days. Calls to Southwest's customer service line went unanswered; baggage piled up in terminals around the country. The disruption got so bad that in Nashville police threatened to arrest customers with canceled flights.

This is all per the reporting of Juan Browne, the American Airlines pilot and famous (in aviation circles) YouTuber who calls this the single largest meltdown in aviation history. He has a compelling take why the meltdown occurred.

Bad as it was, this event should have been manageable -- other large carriers handled the severe weather with comparatively minor disruptions. Southwest couldn’t because upgrading its IT infrastructure, despite calls from pilots and staff, had not been a priority for the last 30 years. Chronic underinvestment in IT left the airline vulnerable to such a calamity, and operations personnel couldn’t handle the resulting impossible task of manual scheduling which ultimately forced the airline to temporarily shut down a majority of its operations to effect a “complete reset”.

Margaret Mead in Samoa c. 1925

Photo credit: Science.org

From the Department of Epistemology:

Culture is Not What You Think (but it IS what you think)

Maybe what’s going on at Southwest is an anomaly. Or maybe it's the culture concept itself that is problematic.

To understand why, you have to begin by realizing there is a wide gulf between how the concept is thought about in business versus what modern anthropologists, sociologists, and cultural psychologists -- those who’ve made culture the centerpiece of their intellectual agendas for over a century -- think.

I describe this gulf in terms of myths. Five in particular endure in the business world that are viewed with deep skepticism by these disciplines working beyond the seductive tentacles of the corporate marketplace and who are hesitant to try and make a buck selling cultural snake oil.

What is below is a short summary. You can read more about each one here. [4]

The 5 Myths of Culture

• Myth #1: The ‘right culture’ will drive business performance. Southwest is the glamour child but this myth was debunked decades ago when a significant number of firms lauded for their great cultures later went out of business or saw significant earnings declines (e.g. Sears; AT&T; IBM; Continental Bank). So-called "toxic" cultures routinely exceed Wall Street expectations or rebounded after scandal (e.g. Wells Fargo; Goldman Sachs; Kay Jewelers). But managers continue to hold on to the myth even though establishing causal links between culture and business outcomes has never been adequately demonstrated, and even though much of the theory and methodology for doing so is deeply flawed.

   

• Myth #2: The leader creates ‘the culture’. Southwest’s culture is credited to its legendary founder, Herb Kelleher. Browne attributes Southwest’s chronic under investment in IT to the “bean counters” now occupying upper management. Had Herb been at the helm the meltdown would have never happened, so suggest many. Our collective -- and particularly US-centric -- hyperventilation over leadership’s outsize influence on culture, whether Jack Welch's, Steve Jobs' or Satya Nadella's, masks a more nuanced and complex set of truths: leaders don’t do it alone. Herb Kelleher had a lot to do with Southwest’s culture and resultant success but on closer examination it was the business practices aligned to business strategy that he and his team put in place and sustained over a decade that was the difference: single aircraft type; single class of service; fast aircraft turnaround times; managers helping to clean planes; point-to-point route structure, etc. Herb’s vision needed a highly aligned set of business practices, and a management team, to see it all through.

• Myth #3: Culture is how employees feel. How employees feel might be an expression, enabler, mediator, or even a reaction to an underlying aspect of a culture, but it is not culture. The way people behave and treat each other is a reflection of entrenched business practices. Mandating overtime, threatening termination for calling in sick, monitoring employee social media, all appear to be manifestations of an aggressive bottom-line oriented business logic embedded in everyday business practices. Southwest is not the company Herb and his team envisioned, but cultures are never static. Southwest, through its media strategy, seems to want us to think otherwise.

• Myth #4: Culture is the same as values. Values are relatively easy to understand. But if it were straightforward, having the organization adopt leadership's values would be as easy as getting your kids to adopt your values. Not so easy. Among several reasons why: it is hard to impose values unless they pre-exist in the organization (e.g. getting a software engineering organization to buy in to engineering-oriented values is much easier than getting buy in for, say, industrial manufacturing values). And values are expectations, not actual behavior. In other words, to reduce culture to values is to grossly oversimplify a highly complex phenomenon. No wonder so many culture interventions based on values go nowhere (except into the annals of corporate humor). Herb's values at Southwest were highly integrated into the aforementioned business practices.

• Myth #5: One company, one culture. This is the granddaddy of all myths. It originates in management consultants and scholars adopting literal interpretations of early 20th century ethnography on so-called “primitive” societies. But pioneers such as Margaret Mead (pictured) or Ruth Benedict  realized early on that the concept of rigid cultural boundaries and monolithic cultures was of limited use.

If These are Myths, What is Culture?

Myths endure because we want to believe in them.

 Call it fear of falling behind the competition, blind faith, or self-fulfilling prophecy, what keeps the corporate cultural myth-buying cycle going is impatience for any idea not easy to digest, implement, and achieve quick results. This problem is not just limited to culture, but the cycle is enabled by the oversimplified ways culture is operationalized. This makes any “solution”plausible if it meets ordinary purchasing criteria, such as trust in the purveyor; cost; fear of what competitors may be doing; ease of implementation; and so on.

OK, so give me a better alternative.

Try this:

1. What if instead of thinking about culture as a monolithic “thing”, a mystical force or magical invisible hand capable (although we know its not) of controlling human behavior and benevolently inciting corporate humans to do amazing things while precluding them from doing really stupid or evil things – what if we turned the construct on its head? What if instead of “The Culture” – that singular “thing” inside a magic box -- we used an entirely different metaphor?

2. This new metaphor conceives of culture as a set of resources -- shared cognitive resources.
    

3. What is a "cognitive" resource? It is a collection of mental models used for making sense. These models didn’t reside in any single person’s head but form a widely accepted way of making meaning for a given community. They don't come directly from the CEO or founder but are the result of a community successfully navigating and adapting to its environment, a process over time that imparts experience and know-how that the community transposes to new situations and domains in order to make sense of them.
    

4. This may not sound revolutionary. But the implications are profound. For one, this is a wholesale decomposition of the construct. Instead of a monolithic whole – The Culture – culture is made up of constituent parts. In some cases these form a coherent enterprise-wide pattern which we then could refer to as a "strong" culture, but more often are highly localized and occupationally dependent.
    

5.  Shared mental models are eligible to be examined as taken-for-granted beliefs and assumptions and thereby, with some hard work, able to changed. They are a portal for accessing what is tacitly in people’s heads in order to bring to light what needs to change but what the organization is having trouble doing because something – i.e. the culture – keeps getting in the way.

    

6. After all, it is exactly these things that keep organizations mired in the status quo. This is the real reason why digital transformation is so hard for legacy companies, why NGOs struggle with private sector management practices, or why organizations that veer too far from their operational task realities (such as an airline becoming too profit driven at the expense of operational excellence or safety), run into the problems.

    

   Such as Southwest.

7. This approach would have a strong theoretical and empirical support in the cognitive sciences, and would revolutionize how we approach change. Instead of focusing so much on leaders modeling "the right" behavior, or changing people’s values, we would work with the “DNA” of a cultural system -- what is inside people’s heads and embedded in business practices. Together, these keep the system doing what it has always done. This would be a far more fruitful, humane and sustainable way to enact positive change.

A goal, by the way, that remains elusive for a vast majority of organizations.

(There is much more to say on this; we’ll leave it here for now and take this up in subsequent posts).
 

[4] For more in depth reading on this, I suggest Chapter 1 of Disrupting Corporate Culture.