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In the last couple of years, through the recession, we have seen most organizations adapt to the changing ground reality. These quick changes have been targeted toward operational efficiency and cost-cutting. Some of these are one-time decisions that are quickly rolled back as soon as the business bounces back.
Many decisions, though, are actioned through changes in systems and processes. And such changes – and effects thereof – are often longer-lasting and go much beyond the recessionary cycle. I wonder if all organizations actually realize that some of these non-reversible changes actually end up as the key determinant of the longer term direction that “organizational culture” takes. If these decisions are not intended that way, organization suffers in the longer run and it becomes almost impossible to rectify those, and many times even to diagnose.
I had earlier written about how organizational silos come into being and how incentive alignment could help organizations make people work together rather than in silos. I have a similar take on how systems need to actually be designed in order to drive the culture that organization really wants to pursue. And these should not get permanently dented by the recessionary cycles or any other immediate business pressures if organization is really looking at decades of existence.
Most organizational decisions affect people because they work in the system day in and day out, and when taken with cost cutting in mind there are some decisions that affect them negatively and directly. Not only in terms of the loss of jobs but more so in terms of impending compensation structure, performance management systems and career progression related policies and systems. And there’s no doubt that the organizational culture is primarily driven by how systems and policies drive people.
When tweaking systems and policies for shorter term goals, do not lose sight of the longer term effects on culture and mindset of people working in the organization. Systems and Policies of today are the organizational culture of tomorrow!