This presentation search for roots of bad culture in surprising location - in strategic failures of top management or misunderstanding of strategy at all.

1. Surprising roots of terrible
organisational culture
by Miroslav Šebek
May 2013
Do you checkmate your own culture by mistake ?
(shortened version)

2. Organisational culture is equal superposion of two
'subcultures' described below:
First part - formed by general situation of an organization.
Let's imagine – a company just won big tender, jobs are secured for years, wages are expected to
rise, people are not overloaded. It's easy to expect that in such company this part of culture would
be 'smiling' (=happy people, willing to collaborate, share information, help each other etc). On
opposite, in a company which is overburdened with debt, loses customers and prepares layoffs,
this part of culture would be 'gloomy' (=frustrated people, secretiveness, lack of mutual
confidence, plots everywhere). You can’t change it by a teambuilding or 'Keep smiling!' posters
everywhere. In fact, such attempts even worse further the gloomy situation, because they
highlight top management’s loss of common-sense.
This first part is obviously direct result of strategy - either good or bad.
And nothing else but strategy can alter it!
Basically, you can't develop Sunday school atmosphere in a refugee camp,
where is lack of everything...
1.

3. Second part - it's about individuals or departments or diverse ways how to
achieve same goal.
It’s just about habits and setting of rules of conduct in an organisation.
This second part of organisational culture is amenable to improvements by
means of psychology, aesthetics, team building, dress code, approach to
smoking, organization of work etc.
It's also broadly open to imitation from one organization to another.
2.
The two parts of culture above are mutually independent,
because change of one part doesn’t affect second part.
The rest of this presentation concerns the first (strategy related) part of
organisational culture.

4. Table at the next slide shows fundamental differencies between Project and
Strategy approaches to a problem and problem solving
The BIG Mistake :
Many people (and especially organisational leaders) believe that
process of building of an organisation is very similar to process of
building of a complex piece of technology and can be made by similar
tools, e.g. Budgeting, Planning, Change management, Problem analysis
or Responsibility delegation...
In reality, building of an (even complex) piece of technology is always
issue of Project Management, while building of an organisation is an
issue of Strategy Development and Implementation.

5. Project Strategy
Clear and static goal (e.g. to build 500m
skyscraper in HongKong till 2015)
Unclear and moving goal (to build succesful
company, beat competion)
Sufficient resources for achievement of the
goal (e.g. $5bn budget for the skyscraper)
Inherent scarcity of resources (you can’t
invade all markets and defend against all
your competitors at the same time)
Nobody tries to undermine your effort Active competion tries to overshadow you
Other projects (even of the same kind) are
irrelevant for you (e.g. other skyscraper
construction next block)
Nothing is more important for you than
strategies of your competitors
Components of a project can be changed
with zero or minimal effect on other
components or on the whole
Every single change in a component of a
strategy requires at least review of the
strategy (usually its total reworking),
because all is tightly interconnected.
Manageable complexity of the project Overwhelming complexity of environment
Repeatedly usable tools (e.g. planning) of
project management are at hand
At best, some laundry lists of ‘Avoid xyz’ and
‘Don’t forget abc’ are available
Leader of a project has to be well organised
BOSS of his/her subordinates
Strategic leader must be DECISION MAKER
able to bear responsibility for his/her
decisions

6. Now, what happens when ‘Project people’ face strategic
challenges :
Strategic challenge ‘Strategic’ response ‘Project approach’ response
Overwhelming
complexity
Simplification; finding of an
outline of the situation
Analysis – paralysis or looking for a tool
(or consultant), which should give the
response
Uncertain future Building of base of broadly
usable advantages, taking
initiative
Incremental planning (based on
previous experience, now-available
data and crystal ball)
Inherent scarcity of
resources
Strategic decision on focus
(=decide what NOT to do)
Try best with available resources
(=overstretch your resources and
people too); improve (=made more
complex) organisational sctructure; use
a team-building mantra (like 1+1>2)
They (project people) are not stupid, they just do in strategic management what
they had been doing successufully before they were promoted to strategic
management.

7. Transforms Uncertainty, Complexity and
Scarcity into
Role of strategic management in an organisation:
Strategic
management
Uncertain future
Overwhelming
complexity of
environmnent
Inherent
scarcity of
resources
The rest of the organisation
Clear, Unambiguous, Attainable and Fully
funded tasks for
By Strategic decision on
Focus (=what NOT to do)By building base of
advantages, taking
initiative
By Simplification and
Outlining

8. If strategic management plays the role:
THEN
Strategic management can sometimes make a mistake, still enjoying support
of the rest of the organisation. Very few mistakes are inevitably fatal...
BECAUSE
Middle managers and rank and file realize that crafting strategy is hard work
including many uncertainties. So they are happy it is not their job.
AND
Even bad strategic decision gives them Clear, Unambiguous, Attainable and
Fully funded instructions what to do. So people are normally carrying out
feasible tasks, maybe giving feedback.
Isn’t the above essence of admired Japanese business culture ? ...

9. If strategic management doesn’t play the role:
(& avoids Strategic decisions on Focus in particular)
THEN
Isn’t the above essence of business culture in typical western
corporation ? ...
1. Strategic management is indistinguishable from the rest of the
organisation in the sense of its mission.
2. Complexity, Uncertainty and Scarcity are invited into the organisation
and everybody must face the demons. It creates the typical atmosphere
of nonsensicality, hopelessness, futility and hostility. Battle for scarce
resources is pernamently under way. Homo homini lupus est – called it
in ancient Rome.
3. Everybody in such organisation can be strategic manager making
strategic decisions – in fact the responsibility is pressed down to rank
and file (nobody in hierarchy wants to decide anything). Such strategic
decisions made at the bottom of hierarchy are usually nicknamed as
‘analysis’ or ‘decision basis’, suplied with initials and sent to
responsibility avoiders in top management.

10. „Things are never so bad they can't be made worse“
Humphrey Bogart
Top managent avoiding responsibility for strategic decisions rarely does NOTHING.
It usually tries to substitute missing decisions for:
1. Organisational measures (= making organisation more complex, introducing new
artificial borders into organisational structure etc.)
2. Improved communication (= more reports, memos, guidelines etc.)
3. Teambuilding & motivational magic (like 1+1>2; I wonder what equals 0+0 in this algebra...)
Scarcity of resources + Artificial borders,
doesn’t it sound familiar to you?
See next slide for the answer 
By the way : Do you think that word ‘compromise’ has positive meaning ?

11. Yes, that’s it !
Middle East and North Africa
Region famous for its prosperity, tolerance and peaceful growth
No wonder that so many business owners want to imitate it in their businesses !

12. Underline notes
1) Even ordinary (e.g. building) project becomes strategic game if active opposition
has risen against it.
2) High tech projects of large scale (far space missions, advanced nuclear power
plants etc.) are always strategic because all resources for them are not clear or at
hand when the ‘projects’ are kicked off.
3) Project Manhattan and Project Apollo were (contrary to their names) well
conducted pieces of strategy
4) Sun Tzu’s famous The art of war says to the topic:
VI.17 For should the enemy strengthen his van, he will weaken his rear; should he strengthen
his rear, he will weaken his van; should he strengthen his left, he will weaken his right; should
he strengthen his right, he will weaken his left. If he sends reinforcements everywhere, he will
everywhere be weak.
X.18 When the general is weak and without authority; when his orders are not clear and
distinct; when there are no fixed duties assigned to officers and men, and the ranks are formed
in a slovenly haphazard manner, the result is utter disorganization.

13. All my presentations on strategy and
corporate culture
Personal planning of strategist http://www.slideshare.net/kerimek/personnal-planning-of-
strategist
My glosses to famous Sun Tzu’s The Art of War http://www.slideshare.net/kerimek/the-art-of-war-glosses
Surprising roots of bad organizational culture http://www.slideshare.net/kerimek/roots-of-badculture
Surprising roots of bad organizational culture – shortened version http://www.slideshare.net/kerimek/roots-of-bad-culture-
shortened-version
Strategic management as group of human beings http://www.slideshare.net/kerimek/strategic-management-
as-group-of-human-beings
Enlargement of a small power plant http://www.slideshare.net/kerimek/enlargement-of-a-
small-power-plant-project-and-strategy

14. Thank you for your attention!
Looking forward to your feedback, you can use my e-mail
miroslav.sebek@seznam.cz
or send me message at LinkedIn