Company Cultures’ Are Valuable Intangible Assets!

Michael D. Moberly    December 30, 2013    ‘A blog where attention span matters’.

Company culture analogies…

Not unlike the landmark pornography case in 1964 (Jacobellis v. Ohio) when U.S. Supreme Court Justice Potter Stewart famous utterance of a rather non-rational perspective insofar as judicial decision making, which I now paraphrase, “I don’t know precisely how to define it (pornography) but I know it when I see it:.  

In many respects, Justice Potter’s perspective is quite similar to the way that company culture is often characterized, e.g., as somewhat of an invisible (intangible) temperament and/or attitude that links companies, employees, and stakeholders together.

Similarly, but more definitively, and some years later, in 2006, Mark Fields, Ford Motor Company’s President of the America’s, who has been credited with initiating a culture change at Ford, certainly elevated the prominence of a phrase widely attributed to Peter Drucker, i.e., “culture eats strategy for breakfast” which I understand was framed and hung on the wall of FMC’s so-called ‘war room’.

The dominant task Field engaged in at Ford with respect to initiating a culture change was to…

  • replace a culture (work environment) that had come to be routinely characterized with terms such as bitterness, distrust, fear, and betrayal, etc.,
  • develop a culture that would come to be characterized with different terms such as creativity, innovation, and (employee) sense of responsibility.

Readers familiar with the American auto industry however, surely understand that the culture reversal that took place at Ford, under Field’s tutelage, or any U.S.-based automaker for that matter, is often fragile and linked to collective bargaining agreements.

There is certainly no intent here to minimize Mr. Fields efforts as I’m confident his advocacy served as both impetus and rallying point to achieve the sought after culture change.  But, it’s important to recognize that large scale (enterprise wide) culture changes are seldom the product of a single individual’s efforts.  And yes, Ford, like other U.S. carmakers at the time, were approaching their own respective ‘fiscal cliffs’ which no doubt served to bring about a greater than usual sense of receptivity and urgency to accept change.  Recognizing that if substantial (cultural) change was not forthcoming and in fairly rapid order, those fiscal cliffs would be more than metaphors, they would, in many experts’ view, materialize as irreversible catastrophes to the U.S. auto industry as a whole.

Company culture is an internal version of a company brand, or a company’s last mile…

A company’s culture, Grant McCracken points out, is an ‘internal version of a company brand’ because it encompasses a company’s mission, vision, and its values.  McCracken is one, among several prominent ‘company culture advocates’ who articulates how an effective (company) culture can impact a business.

McCracken makes a compelling case that ‘company culture may well be marketing’s silver bullet’ inasmuch as culture is at the intersection of commerce, anthropology, and business economics’.

Company culture is a valuable intangible asset…

I have long argued, presumably like McCracken, that a well designed, honed, and monitored (company) culture can produce ‘contributory value’ to many different aspects, venues, and transactions that any company may engage.

I recognize that any initiative, sometimes regardless of its motivation, putting forth the time, resources, and effort to develop and instill a sustainable change to a company’s culture will incur various challenges and hurdles, not the least of which is re-directing long embedded beliefs and back-channel habits which can elevate the probability of failure.

I find such circumstances especially significant when there is no internal champion or compelling rationale for change, i.e.…

  • a clear understanding of a company’s intangible assets, of which company culture is one.
  • a strategic appreciation for the implications that a culture change will, in most instances, bring to a business.
  • tested strategies in which to leverage, exploit, and/or market a company’s culture change once it has been achieved in financial contexts.

So, a company management team that is unable to effectively promote its culture internally, will also experience challenges defining and promoting its brand externally.  In part, this may be due to some of the skill sets expected of management teams today which are related to company profitability and sustainability, are not necessarily skills that coincide with initiating, valuing, managing, and monitoring changes in company culture.

While I do not consider myself to be a ‘company culture’ expert, I have held numerous positions of leadership and management which allow me to state with confidence…

  1. a company’s culture can be a useful and influential intangible asset that can deliver substantial value and competitive advantages to any company and most any transaction and/or venue, be it large or small.
  2. the above is largely dependent on management teams, employees, and stakeholders believing it, i.e., the culture is favorably recognized as delivering intangible value.

Probably the two most significant errors made in characterizing a company’s culture, McCracken notes in his book ‘Chief Culture Officer: How To Create A Living, Breathing Corporation’ are…

  • presuming a company culture evolves from the presence of a single individual, and
  • that an individuals’ personality is synonymous with an organization’s culture.

This blog post has been researched and written by me with the genuine intent it serve as a useful and respectful medium to elevate awareness and appreciation for intangible assets throughout the global business community.   My blog posts focus on a wide range of issues related to intangible assets and intellectual property.   Respectfully, each post is not intended to be quick bites of unsubstantiated commentary or information piggy-backed to other sources.

Comments regarding my blog posts are encouraged and respected.  Should a reader elect to utilize all or a portion of my posts, full attribution is expected and appreciated. While visiting my blog readers are encouraged to browse other topics (posts) which may be relevant to their circumstance or business transaction.  I always welcome your inquiry at 314-440-3593 or [email protected].


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