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Reflection – Bryce A. Smart

by on November 11, 2007

A corporate culture that can weather everything from dividends to Layoffs

“When things are nice, corporate culture is a good thing; but it will never save the organization when things go bad.” This may be true for the types of corporate cultures that are currently developed. That’s because corporate culture has traditionally been created only for the good times. It’s not designed to last.

The PepsiCo spin‐off company Yum!, owner of the KFC franchise, had a chance to build a culture from the ground up. They took the opportunity to build a culture that was fun, as well as successful. In building the company, they took some great risks. According to their head of HR, Yum!’s formula for success placed people and their capabilities first, followed by the customers and profitability. This policy is great now, while times are good for Yum!, but what will that mean if the market takes a downturn, contamination leaks into a market through their poultry suppliers, or new regulation dramatically raises their prices? Hopefully they’ll be agile enough to work around this, but very few organizations could escape unscathed.

Yum!’s great risks are largely avoidable. The trick lies in violating a key principle in leadership: being positive. When developing a culture, executives try so hard to focus on a positive, “winning” culture that they blind themselves to the realities that attack the fabric of an organization.

Businesses ought to look to religion for the answers. Religion exists, in large part, to sustain its followers through difficult times, individually, as well as collectively. Interestingly enough, the culture surrounding a religion also has such a sustaining force. Without violating workplace laws and regulations, how can businesses learn and apply this valuable lesson?

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