According to the Abbott Labs “Promise for Life”:
We strive to earn the trust of those we serve by committing to the highest standards of quality, excellence in personal relationships, and behavior characterized by honesty, fairness and integrity.
Well, it looks like their commitment to the highest standards is lacking. They recently announced a recall of millions of containers of Similac-brand powdered infant formula. Yes, a product for the youngest and most vulnerable. It may be contaminated with insect parts. I won’t go into details, but it’s not something you want in your baby’s GI tract.
According to their press release on their website dated Sept. 22, 2010, the company calls this recall “proactive” and “voluntary” and said that the chances of one having a problem was “a remote possibility.” Seems like they’re saying they are responsible for a quality problem that may not exist. Would they want their babies to be drinking beetles or their larvae every 3–4 hours? Babies are often colicky. Who would guess that the formula was contaminated?
If they truly believe in their Promise for the highest standards of quality, then they must not just promise it, they must live by that standard each and every day. And all employees must consider high quality as a standard that is never violated. If a few prime values are truly part of an organization’s core culture, then those become the guideposts that no one violates. Maybe it’s time for Abbott Labs to rethink their culture and their Promise and be sure that it is more than nice-sounding words.
On CNBC, there was a brief discussion of the Goldman Sachs culture and the possible changes it may be making to the culture. For example, the Goldman culture is known for putting client first, team second, and employee third. Thus, a partner’s business card is aligned with that core belief–with the Goldman Sachs name being most prominent. This is an example of aligning Projections (your image) with the core culture (the values at the heart of your organization).
Goldman historically has not been known for having a revolving door. If you left the firm, you did not return (although Edward Forst was an exception). This allowed those below to have opportunities to move up–a motivational tool to retain workers. If employees were allowed to leave and later return, then opportunities for promotion would be reduced. In a high pressure job with long work hours, this was a tool to keep valued employees. But now Noto a former Goldman partner and media stock analyst who left to serve as the NFL CFO is now returning in October to co-head the global media group. Although his departure from Goldman was not for a competitor, his re-hiring is not typical for this company. Will we start seeing more former Goldman employees coming back to the Goldman home? Will the change to a “bank” status continue to impact the organizational practices and with it the culture?
Companies must be aware of the impact small changes can have on their core culture. Although some changes may seem insignificant, if they are in conflict with the core culture values, these changes will imply a different set of principles that are more important. And if practices continue to change without a discussion of the core culture and its changes, then employees will be confused and with that confusion will potentially be less motivated. Practices–even a business card or an employment practice–must be aligned with the principles and values of the culture. And if the culture needs to change, that must be explicitly addressed and not left for employees to guess.
The new President and Chief Executive of Nokia, effective September 21, is Stephen Elop–the former head of Microsoft’s Business Division (his departure effective immediately). He has previously held the following positions: COO of Juniper Networks (one year and one month); President, WWFO of Adobe Systems (one year and one month); CEO and other positions at Macromedia (7 years, 10 months); CIO of Boston Chicken (6 years); and CIO of Boston Chicken and Einstein Brothers Bagels (3 years).
Elop will lead an organization that has experienced significant change in its history. Nokia began as a paper mill in southern Finland in 1865; the second mill was located on the Nokianvirta River–hence, the name “Nokia.” The founder Fredrik Idestam is considered the father of Finland’s paper industry, according to the company website. The early history of Nokia focused on paper and electricity generation–not communications technology. The move to mobile didn’t begin until the late 1960s.
With a solid Finish connection and culture, Nokia has now chosen a Canadian citizen for its top position. With Nokia’s clearly stated Purpose–Connecting People–Elop will have the challenge to improve company profits and position and lead in finding new and better ways for connecting people. So what will change and how quickly and what does this mean to the culture of Nokia and its future?
Taking a leader from the outside–obviously indicates change. But choosing a leader outside the Finnish culture indicates an added complexity. Two levels of culture must be considered: first is the country culture. How does the Finnish culture differ from Elop’s background? He won’t be changing the country culture. And how in sync or out of sync is the current Nokia culture with the principles and values of Elop? It’s a positive statement that he plans to listen and learn about the company and its culture. But from a culture perspective, one would hope that he already has a good sense of the organizational culture. One would hope that the selection process focused on sharing the core Philosophy principles that are rooted in the company’s history and shared by employees. And surely the selection process discussed the need for strategy change which will directly impact the Priorities that all employees must share.
With Elop’s software experience and North American connections, Nokia may feel a new momentum that will bring change. Obviously, change is needed; the concerns that employees will focus on is what will change and how will the change impact “me.”