Corrupt Corporate Cultures: Further Thoughts

In a comment on this Toronto Life Conrad Black Trial blog entry, I briefly discussed why it's so hard to turn around a corrupt culture. The nub of it was that, in corrupt organizations, corruption and strength go hand-in-hand, so the top sweeper with the "new broom" winds up an ineffectual leader unless (s)he or gets her/his reputation dirty.

Since "corrupt" is a loaded word, I should specify what I mean by it. From an organizational perspective, a "corrupt culture" means one where the formal head of the organization cannot lead by setting an example. Any attempts to do so renders the top boss "the fop at the top." I want to make it clear that I'm using "corrupt" in a particularistic, value-free way.

In a real way, a "corrupt" organization is ridden with certain subcultures, which keep information and true conduct away from the top of the organizational pyramid. "Cabals," "feifdoms," "satrapies" are some of the terms that are used to describe these subcultures. The consensus in these organizational subcultures is that some form(s) of obedient behavior bespeaks weakness, typically relative to competitors.

This element is crucial. If it were just a matter of a cabal taking advantage of an opportunity to pilfer a little - whether it be borrowing the company laptop for the weekend, having a little fun on the expense account, goofing off while on the job or some other kind of "itchy-finger" appropriation - is that it can be elimated by one crackdown of sufficient severity. People who indulge themselves in that way know at heart that they're living a little on the hog, so they tend to quit it when called on the carpet for it.

A corrupt culture is essentially different from the above because of the long-term ineffectuality of any such crackdown, no matter how severe. Anyone who tries to tighten up the ship at the expense of a satrapy will soon find out that things return to the previous norm in it; the only permanent change will be the disciplinarian responsible for the crackdown acquires a reputation as a "martinet," or some such. Sophisticated leaders know this, so they tend to use a gentle or exhortative approach, which leads to the immobilization effect I sketched out in my comment.

There is, of course, no easy way out of the choice betwen the devil (joining in) and the deep blue sea (ineffectuality) that this dynamic sets up. Since this problem is a subtle one even with respect to a single case, let alone in terms of general principle, the only hint that this mere blogger can offer is for any cabal-fighter to see what kinds of corruption, or deviancy, bespeak pride and strength in a corporate feifdom. Beyond that inductive process, any would-be change agent will have to reason teleologically with the gathered data - or just plain wing it.

Of course there is the option of becoming "one of the boys," but there's a real risk attached to it. Straight arrows are always sized up as potential "narcs," or whistleblowers, and any sensible runner of a scheme is going to at least consider some kind of a set-up to keep such a straight shooter in line.