Business Culture: Part 2, Examples of Cultural Challenges

This is the second part in a series of six blog posts on Business Culture.  My perspectives on culture are shaped by many years of experience in a variety of situations.  In the following paragraphs, I will use some of these experiences to illustrate some cultural challenges.

EDS Outsourcing and Application Delivery

In my many years with EDS, I observed the consequences of many reorganizations, mergers and acquisitions.  EDS (and now HP Enterprise Services) is in the business of outsourcing information systems activities—the information systems activities of a client are acquired by HPES.  Every new account involves challenges of reconciliation of cultures.  Data processing operations and application maintenance activities tend to be prescribed tasks with much of the knowledge work performed within the scope of individual tasks.  Application development work, however, is non-repetitive and requires much more collaboration and knowledge sharing.  Thus it is more affected by culture. 

As an EDS Fellow, I had an ongoing interest and participated in a study of the EDS application delivery business model to identify opportunities to improve quality and productivity and thus become more competitive.  Project over-runs, under-utilization of individual capabilities, non-competitive pricing, slow response to advances in technology, and employee dissatisfaction were commonplace.  Each new application development account or major project would be staffed with people drawn from other accounts or pools of developers along with transitioned client employees.  The challenge from my perspective was to develop an umbrella culture and individual team cultures that inspire excellence of timeliness, quality, productivity and personal satisfaction.  Teams for substantial projects were assembled for each new project so each team required formation of new, informal roles and relationships.  This was often addressed with some “team building exercises.”

A key observation was that incentives did not align with goals.  Individuals were at risk of termination when completing an assignment if they didn’t find another assignment on another account; consequently, long assignments were preferred, regardless of the ability or interest of the individual to perform the various tasks involved.  Commitments to solutions and costs were developed by sales teams without involvement of those responsible for delivery of the results.  Responsiveness to customer requests was more rewarding to individuals than change control and timely delivery.  Standard practices were implemented to reduce variability and improve accountability, but these practices failed to utilize the full potential of people.  There was little appreciation of the importance of culture.

Volunteer organization

For many years, I have been president of a volunteer, support, education and advocacy group.  Active members contribute their time to activities for which they are capable and that they believe contribute value to the overall shared, social purpose of the organization.  Except for the necessary, formal roles of a non-profit corporation, the operation of the organization is primarily based on culture.  People become engaged because they want to contribute, and they take responsibility for activities that they believe are important.  They collaborate with others on particular initiatives of shared interest. 

One of my challenges is to engage new participants to sustain and expand our efforts.  In working to engage a new participant, I try to understand their interests and capabilities, and emphasize the potential synergy and personal satisfaction of working together toward the goals of the group.

Another challenge is to maintain a non-partisan political standing.  Advocacy can involve influencing government action.  However, status as a charitable organization and, particularly, the diversity of our membership require that we not take partisan positions.  We must avoid initiatives or approaches that may be in conflict with the political interests of some of our members.

Personnel motivation model

In 2004 I submitted a patent application for a Personnel Motivation Model.  This patent application describes a computer-based model for considering the effects of incentives, personal relationships and personal interests on motivation of individuals to contribute to goals.  This grew out of my analysis of the lack of competitiveness of the EDS application development business, discussed above. 

There are many interests, relationships, and incentives that vary among individuals and teams.  The motivation model is intended to help manage the complexity of the many elements and relationships in order to define appropriate incentives and motivate individuals to strive for shared goals.  The patent is still pending.

Book

In my last book, Building the Agile Enterprise with SOA, BPM and MBM, I focused on business modeling, highlighting the modeling of extended value chains to define shared capabilities and integrate them as shared business services.  The emphasis was on design of the enterprise for agility, accountability and economy of operations.  Enterprise agility is enhanced by empowerment and individual initiatives supported by informal roles and relationships.  I did not identify this as culture in the book, but culture is key to achieving excellence of agility, accountability and productivity.  The book  led to the initiation of current work on the Value Delivery Modeling Language (VDML) as an Object Management Group (OMG) industry standard. 

Value Network Analysis

Verna Allee, another contributor to VDML, brought in Value Network Analysis (VNA).  VNA focuses on the exchange of values between participants at all levels from exchanges between business partners to technicians solving product or service problems.  Verna emphasizes the exchange of “intangibles,” those deliverables that are not part of the formal business processes but are essential to effective business operations.  I see many of these as cultural elements—extended roles and responsibilities that have emerged to solve ad hoc and less predictable problems, improve performance and achieve better results.

A challenge for users of VDML is to understand beyond the operational need for these intangibles: how are these informal relationships formed and how are people motivated to establish and participant in these exchanges.  VDML users must also recognize the difference between intangible exchanges that are well established and persistent, and those that are ad hoc, flexible, cultural practices.