Can an organisation have a soul? It’s debatable. Yet, whatever we label it, there is certainly something intangible which gives an organisation its character.
In some organisations this nature is clearly articulated, documented in a mission statement and a value set created with the help of the workforce. Others have a certain facade they wish to project. They publish values documents which may bear little resemblance to the real culture of the organisation. Yet still its employees are able to identify and articulate the organisation’s ‘actual’ nature.
Often in UK firms where no such published collateral may exist, there is an implicit “this is the way we do things around here” which employees understand and acknowledge. For an organisation’s staff this ethos, either stated or implied, forms an important part of the reason they remain with the business. It forms a key element of the psychological contract of employment. This is an implicit agreement between the employee and employer; if the business does ‘x’ then I will do ‘y’. Typically this psychological contract is a positive thing which re-enforces the employee’s commitment to the organisation.
However issues can then arise when an organisation wishes to affect business change. For example; the new leadership team wants to open a different market, or a change in the economic climate leads to a harder nosed commercial approach. These and myriad other rational and reasonable business decisions could negatively impact the implied psychological contract. Whilst there has been no material change to an employee’s terms and conditions, staff may be justified in feeling “things have changed”. In extreme cases this could mean they suddenly begin to consider life outside the organisation.
Clearly businesses do need to change. To ensure the most committed members of staff don’t begin to look for an exit, engage with them early to articulate the nature of the change. Take the time to explain why the organisation is carrying out the change and how it relates back to “the way we do things”.
Ultimately, if the change really is a “volte face” in the nature of the organisation, then the end result may be the same. However if handled well leaders can be aware of the risk and actively manage to prevent or limit potential losses.
Alex Richardson is a Consultant in the IT Leadership Practice of Berwick Partners.
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