08 Oct 2015 21:44 IST

Culture that drives a company's success starts with the CEO

Success is not just about great execution but also about instilling a great culture for employees

Companies are not doing a great job of identifying leaders who would not only make the organisation succeed but instil a great culture for employees too, says John Mattone, President & CEO of John Mattone Global. A leading authority on talent, leadership and corporate culture, Mattone was among the top 10 leadership gurus of 2015. He was recently in India to attend the SHRM’s HR conference and spoke to BusinessLine on Campus about leadership and culture dilemmas. Excerpts from the interview:

What are the leadership issues companies face today?

Most companies are not doing a good job of identifying future leaders and accelerating their development. There is so much talent out there and companies need to do a better job of identifying the great leaders and investing in them. They need to strengthen their leadership pipeline. That’s one gap. The second gap is when you look at managers, leaders who are currently at the C level — there are a lot of bad CEOs. They need help in becoming the best they can be.

What kind of leadership gap exists at mid-level?

In some parts of the world there is a quantitative gap. There is not enough supply in the US, East Asia and Europe. There is not enough of a Gen X population to fill the mid-level roles. So, there is a number gap.

In certain parts of the world, on the other hand, like in India, South America and Africa, it’s different. There’s no numbers gap because there is talent. The challenge is who are the people we can invest in to accelerate their development. So, it’s more of a qualitative gap.

How can a company develop a culture to inculcate leaders at all levels within the organisation?

Culture starts with the CEO and the C-level executives. It takes a CEO who understands that a company is a combination of inner core attributes of the people. So, if you look at the values of a person, their character, how they think, their emotional make-up — those are the elements that reflect in how the companies would behave. When you look at culture, even in the family, it is a combination of all the things that people bring.

To bring a culture of leadership, you have to select and promote the right people. If you have people who don’t posses the elements that are needed to drive the business they need to be coached.

For instance, Amazon is one of the most successful companies of the world but they were getting a lot of complaints about the culture. They asked me about the things they can do to change, and I said, we can’t argue with the operative success of Amazon. Jeff Bezos is the CEO of Amazon, and he’s a tough guy, who measures things. People who were complaining didn’t like the measurement system at Amazon and they just didn’t fit. And those people either had to be forced out or they just said to themselves, I am out of here.

Where do you draw the line, when it’s a tough culture versus a lenient one?

If I get a choice between the likes of Jeff Bezos and Alan Mulally, the former CEO of Ford Motor Company, from what I know of both people, I would select an Alan Mulally over Jeff Bezos, even though I write a lot about Bezos in my book. Bezos is a great leader but he is not perfect. His people skills are a problem, he is a perfectionist. So, if you come to work in Amazon and you are short of the expected professionalism, he will not like it.

When it comes to drawing the line, each company is different. Each culture is different. It’s very important that an organisation selects senior executives that can help navigate the company through the turbulent times. And it doesn’t mean that they necessarily take the elements of culture in the past and continue. As a CEO you need to make sure people leading the organisation are transforming it every day.

A lot of companies make a mistake when they say: “We need to be innovative,” or “we need to be more customer service-oriented”. That’s not the important question; the question is let’s determine what’s going to drive our operating success. And if it requires you to be more innovative, okay, then you need to drive the culture in that direction.

Do you feel a culture that’s highly focussed on getting a job done is a bit short- sighted?

What defines a culture? The Bezos culture in Amazon is an execution culture. It is the core element of Amazon’s culture and is driving operating success. My research, on the other hand, is based on mixing five cultures together. These five cultures are: The culture of ‘Can do’ — people believe they have the skills and competencies required to help the company more forward. And that culture is very important to create. Second, is the culture of ‘Will do’ — the culture of passion and driving motivation. It is a culture of being nourished within an organisation. Then there is a culture of ‘Must do’ — when people feel aligned to the mission of the organisation.

Those three cultures drive two others: ‘individual performance culture’ and a ‘team performance culture’. I would say the Amazon culture places disproportionate emphasis on the execution part. All the five cultures are critically important; fulfilling just one will not be enough.

Among the best organisations in the world, with a great culture, are Fedex, Coca-Cola, Infosys, Zappos and Southwest Airlines. These companies tend to cultivate those five cultures and that’s one of the reasons they are doing so well.

What is the next big trend in culture and leadership?

When it comes to culture, the organisations that are thinking about what they can and must recreate given all the disruption going on in the world will drive the change. The companies that embrace this mindset are going to win.

The next big thing in leadership is the old thing. It’s not about spread-sheets or big data, it is more about core strength — having the right values and character, and the right thinking patterns, maturity. More than anything it is about being a servant leader, it’s about being altruistic.

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