4-2 Culture and Adversity

4-2: Culture and Adversity

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MGMT 440- F1WW

Dr. Christine Seebon

October 21, 2018

Healthy Culture and Strategy

A healthy organization creates beneficial circumstances that increase the chances of success within an organization. In times of adversity, there are several factors that influence the nature of the outcomes. Some of these factors include the strength and health of the organizations’ cultures, whether leadership is present during the time of adversity, leadership styles, and whether the adversity is industry-wide (Heskett, 2012).

Times of adversity can actually strengthen an organization’s culture by forcing associates to question values and employ them in constructive ways. Strong and healthy cultures can preserve the capacity for recovery by retaining critical talent (Heskett, 2012).

An effective culture and strategy bring people together against a common threat, preserve the organizations capacity for recovery, foster latitude—the authority to act on behalf of the organization at all levels, provide a shorthand and common language based on shared assumptions that facilitate action, provide guidance about how nonperformers are asked to leave and when (not just when jobs have to be cut back) (Heskett, 2012).

At Southwest Airlines, employees have repeatedly put their organization before themselves. Their healthy culture and strategy have lead them to have high rates of loyalty in both good times and bad. In the immediate aftermath of a setback to their industry, Southwest’s culture remains positive (Heskett, 2012).

Weak Culture and Performance Implications

Cultures can have a negative impact on performance in times of adversity if the culture leads to inaction in the name of values and the need for consensus, produces behaviors and actions that constrain otherwise logical strategies, rules out unnecessary actions that are perceived as having a high cost in terms of damage to the culture, and/or delays the departure of those not contributing to the organizations success (Heskett, 2012). If a culture is so weak that it provides no guidance, performance will be affected.

Goldman Sachs is a public corporation whose leadership has relied heavily on the loyalty of the employees. However,

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