02 Nov Don’t rely on information technology to change corporate culture
With electronic productivity and communications tools now ubiquitous, organizations of all types are eager to harness their potential to promote more effective communication and collaboration among workers. While these new capabilities have an important role in organizations, the belief that technology by itself can be used to modify the culture and behavior of an organization, particularly a dysfunctional corporate culture, is naive. Yet that is precisely what some executives seem to think.
For example, an article appearing in Information Week last month describes how one company is testing software that allows employees to search each other’s address books for contacts.
The article reports that Marsh & McLennan, a large insurance brokerage, is experimenting with this new search capability in the belief that it can encourage sharing of information and collaboration among its employees that “might otherwise shy away from sharing.”
The company’s CIO for global development characterizes the company’s culture as “individualistic — one in which managers and workers naturally avoid collaboration unless some urgency exists that requires a group effort.” He adds that “Urgency creates discomfort for individuals. If people are comfortable, they’ll never collaborate.”
Excuse me, but what’s wrong with this picture? Haven’t the lessons of Enron and Arthur Andersen taught us anything? Healthy organizations have cultures in which the natural and comfortable thing to do is to share and collaborate with each other. There is something fundamentally troubling about a culture that is so individualistic that its members have to be forced to share information and work cooperatively with each other.
Indeed there is much cause to be skeptical about the culture of Marsh & McLennan, a company that currently has Elliot Spitzer in hot pursuit of it for alleged bid rigging activities and other crimes. It also owns Putnam Investments, an investment management firm implicated last year for illegal market timing of trades.
These facts make you wonder whether the company is pushing employees so hard to perform that some are resorting to unethical and illegal behavior to make their numbers. The CIO’s statement that the workers “have to be made uncomfortable” to collaborate is especially telling. In other words, the natural tendency of Marsh & McLennan staff is to compete with each other.
Academic research shows culture is the key driver of behavior, and that while information technology can facilitate collaborative behaviors it can’t force them to happen. For example, a case study done by researchers at MIT in the early 1990s shed insights into how culture trumps technology. It described the experiences of a leading accounting and consulting firm that introduced software to support collaboration and knowledge sharing (groupware, as it was called then) among its staff.
The system was never embraced by employees because the company’s entire culture and supporting management practices — its appraisal system, rewards and incentives and criteria for promotion — motivated employees to vie with each other for advancement up the corporate ladder. Knowledge and information were viewed as key weapons in this intra-organizational competition. Introducing sophisticated knowledge sharing and collaboration tools did nothing to alter the fact that there was no incentive whatsoever to share anything with a colleague. Why would you if you were competing with them to be made a partner? Not surprisingly, the system was scrapped shortly after its introduction.
Companies that succeed over the long haul are adept at getting people to compete together against an external rival rather than vying with each other internally. Promoting individual initiative and accountability are important, but they should be balanced by a focus on group objectives and shared interests. Popular practices like forced ranking—a performance management system that rewards people based on how they do compared to others in the company, internal competitions for new product development or hitting sales targets and CEO succession bake-offs make it easy for workers to rationalize and excuse selfish behaviors.
Deploying a system to promote voluntary collaboration in an organization that pits people against each other is folly. Trying to force people to collaborate and share information via IT in such an environment is inviting rebellion or civil war. Companies really serious about changing the behavior of their employees should rethink their management practices and the values and norms engendered by the organizational culture and behaviors of its leaders.
Relying on IT alone to change how people act won’t work. They will always find a way to foil the technology and subvert the process.
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Tony DiRomualdo is a business researcher, writer, and advisor with Next Generation Consulting. He works at the intersection of people, business strategy, and information technology to help companies create a committed and high performance workforce. Tony can be reached at td@nextgenerationconsulting.com.
The opinions expressed herein or statements made in the above column are solely those of the author, & do not necessarily reflect the views of Wisconsin Technology Network, LLC. (WTN). WTN, LLC accepts no legal liability or responsibility for any claims made or opinions expressed herein.