• Joe Cahill On Business
  • Joe Cahill On Business

    These two CEOs are climbing a manager's steepest hill: Culture change

    Neither McDonald's Chris Kempczinski nor Boeing's David Calhoun will achieve their strategic goals without changing the way people in their companies think and act. Pulling that off is even harder than it sounds.

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    79彩票注册网址David Calhoun

    79彩票注册网址

    New CEOs at two big-name Chicago companies face major challenges rooted not in competition, strategy or economic conditions, but corporate culture.

    At aerospace manufacturer Boeing, David Calhoun is working to regain the trust of regulators, airlines and the flying public after two fatal crashes raised doubts about the company's commitment to safety. McDonald's new CEO, Chris Kempczinski, needs to restore morale and repair damage done to the company's image by that led to his predecessor's ouster over an improper relationship with a subordinate.

    Neither will meet his challenge with a strategic shift, a cost-cutting campaign or an acquisition. To succeed, each will have to change the ways people at his company think and act—the corporate culture, in other words.

    To be sure, both bosses also have urgent business imperatives. Calhoun needs aviation regulators to clear Boeing's 737 Max jet to fly again, so the company can resume selling its biggest moneymaker. Kempczinski must figure out how to reverse steadily declining customer traffic at McDonald's stores. Fixing the culture isn't a distraction from those objectives—it's essential to accomplishing them.

    79彩票注册网址Corporate culture is a murky, nebulous concept that can be hard to define. Still, it's a real and powerful force in every organization. Experts describe corporate culture as the expectations, attitudes, priorities and behaviors that influence what happens within a business. In short, culture drives what people do and how they do it.

    Therefore, culture hugely affects a company's ability to execute business strategy; some say "culture eats strategy for breakfast." Cultural resistance has thwarted many attempts at organizational transformation and strategic change, leaving CEOs to bemoan their inability to alter "the way things are done around here."

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    Chris Kempczinski

    79彩票注册网址

    79彩票注册网址But CEOs do have plenty of influence on culture, just not in the way many think. Effective culture change starts with an understanding that corporate culture reflects fundamental values, the things a company truly cares about. A company's real values aren't the bromides recited in "mission and vision statements" or emblazoned on posters lining office corridors. Companies large and small routinely vow fealty to such unimpeachable values as "respect," "integrity" and "commitment."

    79彩票注册网址Try squaring those lofty ideals with the conduct of many big companies nowadays. Despite its oft-stated commitment to safety above all, Boeing seemed to focus more intently on when it worked feverishly to convince regulators and airlines that pilots wouldn't need costly simulator training on new flight control software blamed for triggering the crashes that killed 346 people. And McDonald's professed belief in "working environments that respect human rights" rings a bit hollow amid in franchisee-owned restaurants and a report that some corporate employees felt compelled to socialize with senior executives in ways that made them uncomfortable.

    Such gaps between actions and stated values are all too common. Only the former reveal a company's actual values. The actions of leaders demonstrate what really matters to an organization. Lower-level managers and front-line workers adjust their own behavior accordingly, giving rise to a culture that serves those values.

    One expert compares it to parenting. "Kids don't watch what you tell them, they watch how you behave," says Jeff Hyman, CEO of executive recruiting firm Recruit Rockstars and an adjunct professor who teaches a course on recruiting and corporate culture at Northwestern University's Kellogg School of Management. "It's no different at a company."

    79彩票注册网址What employees at Boeing saw over the past decade was a senior management team hellbent on driving down costs and expanding profit margins. McDonald's staffers saw boozy after-hours sessions where senior executives hobnobbed with lower-ranking colleagues, despite company policy against supervisor-subordinate relationships.

    79彩票注册网址To their credit, Kempczinski and Calhoun seem to understand the need for actions consistent with their companies' ostensible values. In a move seen as Calhoun's handiwork just before he took office on Jan. 13, Boeing called for simulator training on the updated version of 737 Max software, reversing its earlier opposition. In an email to employees, Calhoun outlined priorities including "strengthening our culture" and "holding ourselves accountable to the highest standards of safety and quality."

    Kempczinski, for his part, is gathering input on company culture from employees. "It's about how we conduct ourselves," he told a recent town hall meeting of employees, promising to "uphold the values" of McDonald's personally and dismiss any senior executive who doesn't "personify the values of our company."

    79彩票注册网址Important first steps. Culture change requires a long march in the same direction.

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