United Airlines has found itself embroiled in a public relations disaster.
Images of a passenger being forcefully ejected from one of its overbooked planes have been viewed by hundreds of thousands of people, and an unrepentant response from chief executive Oscar Munoz has only served to add fuel to the fire.
Unsurprisingly, there have been calls for Munoz to step down. But others believe that this would only represent a token gesture – and that the entire company culture needs to be reviewed.
— Esteban Kolsky (@ekolsky) April 11, 2017
One organisation that was forced into a culture change following a crisis was UK supermarket giant Tesco, which was caught inflating its accounts by over £260 million in 2014.
Chairman Sir Richard Broadbent stepped down, and eight of its senior executive team were suspended, but new chief executive Dave Lewis admitted at the time that the entire culture of the company would need to change in response to the scandal, urging the company to "get back to doing our best for customer".
So how does a bad company culture become ingrained in the first place?
“Culture is not a light and fluffy concept existing only in the minds of the HR department; it is a living and breathing entity and it affects how individuals behave, act and work,” Mary Clarke, CEO of people risk assessment firm Cognsico, told MyCustomer.
“Organisational culture not only drives how people behave, but their attitude towards risk taking. In Tesco’s case… risk taking and ‘creative accounting’ at the top impacted everyone from the management team and frontline staff, to the customers, suppliers and shareholders - eroding its reputation, share price and company value.”
But, of course, this does not happen overnight.
“It builds over a prolonged period in which certain behaviours are overlooked and unchecked by people responsible,” continues Clarke. “When the ‘wrong’ behaviours are driven through an organisation and transparency, openness and honesty aren’t prized highly enough, then it will only be a matter of time before the outside world starts to notice.”
The task for companies like United is therefore not only to invest in new staff, but to define and build a different and better culture, where the right values and behaviours are embraced by everyone from senior management team to the online delivery staff – and customers and shareholders start to notice.
Clarke adds: “How people behave at work is a result of the organisational culture, and sometimes individuals deviate from the expected norms that are put in place by the organisation. At other times there are behaviours that are deemed acceptable at first, yet after analysis, are in fact incorrect because the processes driving the behaviour need reviewing, along with why this was embedded in the first place.”
So how should United respond?
- Start with a culture survey in order to get a ‘baseline’ of the current cultural norms and understand how people truly behave and understand their roles.
- Review existing training and comms to see if, how and where they match cultural aspirations.
- Audit training and comms to understand why despite continual training, review, and refreshers of a new culture seeming to be in line, ‘it’s’ not sticking.
- Re-evaluate the strategy and customer proposition. Questions to ask are, “who are my customers?”, “what sort of employees do we want to employ?”, “what sort of organisational culture do we want?” and “are we listening to our staff about how we could change?”
- Create interventions to embed a new company vision. Clarke notes: “With a vision in place, senior management need to lead by example, communicating clearly that “this is how we do things around here” and these messages and interventions must be reaffirmed continually so everyone understands them.”
- Ensure employees are clear about what the company expects from them – how they should work, how they should treat customers and the kinds of behaviours that are acceptable and those which are not. “Companies need to measure this to understand what employees are thinking and how they are behaving at work,” says Clarke.
- Measure employees’ level of understanding of their jobs, their likely behaviour in different work scenarios and how confident they are in making decisions. While new processes and procedures are important, they are not enough if employees do not understand them and/or follow them.
Since 2014, and Dave Lewis' pledge to change company culture, Tesco has significantly improved its own reputation. Research by Reputation Institute reveals that perceptions of Tesco across all dimensions of reputation have improved - most significantly perceptions of workplace, governance (fairness, transparency and authenticity) and citizenship have increased, as have perceptions of products, leadership and performance.
This represents a lesson to United Airlines. But the company’s culture won’t change overnight, and it needs to start somewhere. And with United making headlines for all the wrong reasons, that time should be now.