From Bristol To HP: When Friendly Doesn't Cut It

Not long ago, Bob Whitman, the chairman and CEO of the famed leadership training firm Franklin Covey, told me a story about how building a strong company culture can be tougher than it seems.

When Whitman helped create the Bristol hotel chain in 1995, he and the rest of the new leadership team settled on a handful of mantras that would embody the culture they wanted, including prizing cleanliness, customer satisfaction, ethics and – the kicker, hiring only “incredibly friendly” employees.

But it wasn’t long before Whitman’s new culture was tested.

The head of one of the nation’s largest endowment funds – and one of Bristol’s largest investors – called to ask if Bob could help the investor’s niece land a job at Bristol. This niece was be a smart, attractive young woman from a top university. Whitman said it should be no problem.

“I sat in on a couple of the interviews with teams that included Bristol senior executives and front-line employees.  I was impressed by how smart and articulate the young woman was; and I assumed she’d be hired immediately.”

After the interview, the hiring team asked Whitman to stay behind to discuss her candidacy.  They told him they liked her and were impressed by her intellect and energy.  But then they caught him by surprise.

“Would you say she was incredibly friendly?” they asked.

“I responded that I found her to be impressive and likeable,” Whitman recalled.  The team asked again – but was she incredibly friendly?

“I said I thought she was friendly but no, I had to admit that she wasn’t incredibly friendly.”

Although Whitman was a co-owner of the business, and was intending to do a favor for a major investor, he realized he couldn’t override the team’s decision if he wanted to have a culture worth anything.  The culture he’d hoped for was taking root; and he couldn’t interfere with that, no matter whose niece this was.

Culture starts with company leaders, but it ends with employees.  You know the values your culture reflects are being absorbed when people at all levels can feel confident basing decisions on them – and know they’ll be supported.

And just as building a culture requires care and dedication from leaders before adoption by the rank-and-file, destroying a culture is much easier from the top.  New leaders and CEOs have to tread especially carefully.

If the new honcho doesn’t care about the deep-seated values that form the company’s self-image, its brand, its way of doing things — prepare for a blow-up.  Either the culture will stand, and the CEO will end up a casualty – or the CEO will change the business’s priorities and behavior from the inside out.  The latter can be good if the firm is stuck in a rut and needs new life.  But an insensitive leader can shatter the decades of tradition that have made a great company what it is.

Take Hewlett-Packard.  After 70 years of world-class culture-building and an empire of nearly 350,000 employees, HP has lately made a habit of going outside the organization to find its CEOs.

And HP’s vaunted culture has paid a heavy price. The legendary “HP Way,” the decentralized and egalitarian culture fostered by co-founders Bill Hewlett and David Packard, has been altered – some would even say snuffed out.  After the last messy CEO change and a series of disastrous business decisions, a former HP director told the New York Times, “[Before this] I didn’t know there was such a thing as corporate suicide…”

HP’s long-running soap opera shows how even the strongest cultures can end up in intensive care if leaders have trouble respecting their organization’s history and values.

So when boards swap out CEOs, they need to stay vigilant about the values their employees have taken to heart.  Does the new CEO get it? If not, maybe he should go somewhere where plain old friendly is good enough.

Forbes.com