Essay Organization Culture

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Maintaining Organization Culture Through Leadership Succession Planning

Dawn Valentine Assistant Professor University of Montevallo Stephens College of Business Montevallo, AL 35115 [email protected]

Introduction Cultural leadership indicates the degree to which cultural ideologies and expressive

behaviors are affected by leadership. Cultural leadership can create, change, embody, or integrate organizational cultures. The existing literature on cultural leadership focuses almost exclusively on how leadership can be used to create or change cultures. Leadership studies fail to consider the importance leadership plays in cultural maintenance through embodying or integrating cultures (Trice and Beyer 1993). This paper focuses specifically on the role of leadership in maintaining an organizational culture. Leadership that maintains a culture is defined as leadership that sustains cultural continuity through the continued viability of a culture's substance, including ideologies, values, and norms. Some organizations are so fortunate, due to factors such as power, size, experience, or luck, that they can prosper without substantially changing their cultures over periods of time. They either do not encounter the circumstances that require change, or they are able to manage such circumstances successfully using understanding and behaviors consistent with their existing cultures (Trice and Beyer 1993). Leadership is an important component in building and maintaining organizational culture. Cultural leadership performs three important tasks: (1) it sustains the mission, distinctive role, and basic commitments of the organization; (2) it embodies its purpose by actually implementing its mission and, in the process, gives shape to its culture; (3) and it maintains organizational values and identity by defending the culture's integrity and making its ideologies as secure and stable as possible (Selznick 1957). Maintaining an existing culture requires that members continue to believe in and be emotionally committed to the substance of that culture. Leadership plays a key role in keeping members aware of and committed to their cultures in situations where cultural maintenance is desired (Trice and Beyer 1993). Change is inevitable in all organizations. It would be inaccurate to think of maintaining a culture without some degree of change occurring within it (Trice and Beyer 1993). An organization may experience change in several areas, including culture and leadership. A new leader is often brought into an organization with a goal to change the existing culture. Therefore, it is important to note that a change in leadership is often associated with a subsequent change in culture (Miller 1993). This association could be disruptive to an organization desiring to maintain an existing culture regardless of a change in leadership. This is particularly so for organizations that experience a higher rate of leadership succession than others. In a situation where an organizational culture is successful and in no need of change, maintaining the continuity of that culture is a desirable goal despite the rate of leadership succession. While change is needed in some organizations, in other organizations it is not necessary. For many organizations, it is important to maintain the continuity of the existing culture. A change in leadership can totally alter some organizations and make no difference in others (Van Fleet

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1991). As a result, leadership succession may pose a problem for organizations desiring continuity of the existing culture. The underlying assumption of this paper is that there are important cultural values in some organizations that need to be sustained. However, sustaining an existing culture does not mean that the organization is not able to cope with change. The ability to adapt to the changing environment may be part of an organization's culture (Trice and Beyer 1993). In order to respond to changing environment while maintaining the culture, the leader may make incremental changes in organizational structure and strategy (Yukl 1994). Background

The effects of leadership change have been noted in the literature and a number of succession studies have attempted to assess the amount of change that occurs in economic organizational performance outcomes after changes are made in top leadership (Friedman and Saul 1991; Yukl 1994). However, in the literature reviewed for this paper, no studies were found that examined the relationship between leader succession and maintenance of the existing organizational culture. While no research has examined the effect of leadership succession of the organizational culture, some authors have asserted that leader succession can affect company morale, as well as cause disruption and employee turnover. Trice and Beyer (1993) suggest that a succession of different change-oriented leaders with new and different ideas seems likely to produce ambiguity and conflict among organizational members. Longshore (1993) proposes that a change in leadership has the potential to create a significant disruption and disillusionment among staff. However, the only empirical evidence that exists to support these assertions is by Friedman and Saul (1991). Their study examined leadership change and the reactions of organizational members in Fortune 500 firms. This study focused primarily on successor-induced change in the organization and its effect on organizational members and future performance. Findings of the study indicate that an outside successor is significantly related to disruption, as well as turnover among organizational members. This paper proposes that there is a relationship between planned leader succession and the continuity of organizational culture. Leadership is defined as the maintenance of cultural continuity through the continued viability of a culture's ideologies, values, and norms (Trice and Beyer 1993). In this paper, the term "leader" is synonymous with CEO. Leadership succession is defined as an institutionally implemented process by which an organization prepares for a future leader in the event one is needed. Culture is defined as the existing ideologies, values, norms and expectations shared by an organization which affects its members and performance. Continuity is defined as the continuation of the existing culture through maintenance of the current cultural elements. The effects of leader succession planning on organization culture is of particular importance to various organizations with a high rate of CEO turnover (Ciampa, 2005; Longshore 1993). While CEO turnover is commonplace in many organizations, succession planning is not. However, one national survey has recently indicated that succession planning is on the rise. However, despite the support for succession planning in organizations, many companies still do not initiate it (Charan, 2005). SUCCESSION PLANNING

Succession planning may be a key element in dealing with the culture problems associated with leader succession. The culture has a better chance of continuing when an organization plans carefully for leadership succession because the past cultural elements remain

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intact. When cultural continuity is desired, respecting the past is important because it provides the ideological and emotional grounding for the current culture (Trice and Beyer 1993). Succession planning is designed to provide a smooth transition leadership for the organization (Walker, 2005). Leadership succession may be institutionally implemented as an organizational Succession planning involves a grooming process which allows potential candidates for the leadership position to gain the skills and knowledge needed. Grooming is defined as the process by which a future leader is trained for many aspects associated with the leadership position, including behaviors needed to maintain an existing organizational culture. Trice and Beyer (1993) note certain leadership behaviors required to maintain the existing culture. When desiring culture maintenance, a leader should exhibit the following behaviors:

Articulate ideology Represent existing values that were successful in the past Effective role model Motivate Refurbish and strengthen existing culture Affirm and celebrate existing cultural ideologies and values Continue existing traditions

Continuity is made appealing and vital

These behaviors require a certain degree of familiarity and knowledge of an organization's past practices in order to carry on existing traditions and cultural elements. The grooming process enhances cultural leadership by preparing the successor for these behaviors involved in culture maintenance. Based on the behaviors required for cultural maintenance and the role succession planning plays in preparing a future leader for these behaviors, the grooming process seems to be the key to effective leadership succession. Common traditions, explicitly articulated objectives, and strategies whose elements are harmonized help integration of a culture, but they require organizational continuity and stability (Trice and Beyer 1993). The grooming process enables the established leader to pass the organization's cultural elements to his successor, providing a basis for future continuity and stability of the existing organizational culture. Thus, when a leader grooms a successor for a leadership role, the existing culture of an organization is more likely to be maintained. Planned leadership succession provides other benefits for the organization as well. Succession planning enables a leader to prepare his successor for future challenges of the organization. Most new CEOs do not have the experience, resources, or reputations of their predecessors. Few of them "know the ropes" very thoroughly and are not as familiar are their predecessors with the practices and problems of their organization. In addition, new CEOs are usually not as knowledgeable about as broad an array of functions and departments within the organization (Miller 1993). While there are many benefits associated with succession planning, few organizations actually implement the process (Trice and Beyer 1993). HYPOTHESIS

The literature on leader succession provides a basis for the hypothesis set for in this paper. There are potential problems related to unplanned leadership succession. Succession seems to break organizational momentum. Leader succession is associated with company morale, employee disruption, and employee turnover. These reactions among organizational

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members are not uncommon, given that a change in leadership is often associated with a change in culture (Miller 1993). When it is desirable to maintain the existing culture of an organization, these reactions may be destructive. Such an organization would benefit from developing a plan by which the negative effects of leader succession could be minimized. Based on this assertion, this paper suggests that it is important for organizations to implement succession planning when culture maintenance is desired. When there is a good deal of continuity in an organizational environment, the changes associated with leader succession may do more harm than good (Miller 1993). In planned successions, the culture of an organization is more likely to be maintained because the successor will be familiar with the substance of the culture and will be aware of how to maintain the culture. Based on the literature reviewed, it appears that cultural continuity would less likely be maintained in organizations with unplanned successions. This is due in part to the grooming process involved in succession planning which provides stability for the existing organizational culture. Based on this premise, the following proposition is proposed: Compared to organizations with unplanned leadership succession, organizations with planned succession that experience a change in leadership are more likely to sustain the continuity of the existing culture.

Conclusion The examination of the relationship between succession planning and organizational culture would be useful to organizations in several ways. If planned leadership succession does indeed have an effect on the continuity of the existing organizational culture, it would be important for more companies to engage in succession planning. Furthermore, how organizational members react to leadership change is potentially useful in explaining the effects of succession on economic performance outcomes (Friedman and Saul 1991). The continuity of an existing culture in a successful organization may be an important factor in maintaining positive economic outcomes. Succession research is still very limited, and the results are not conclusive due to the many methodological problems in measuring leader effects (Yukl 1994). One reason for this problem could be that leadership research has not been guided by a well-supported definition of leadership. Leadership has not been sufficiently defined, and as Stogdill (1974) stated, “there are almost as many definitions of leadership as there are persons who have attempted to define the concept.” The leadership literature would benefit greatly from a well supported, explicitly defined concept of leadership. The relationship between succession planning and organizational culture remains to be refined. An important area in need of additional research is the succession planning process. Specifically, it would be beneficial to determine the factors involved in the grooming process of succession planning that instills cultural values and enable the existing culture to be sustained.

REFERENCES Charan, Ram (2005) “Ending the CEO Succession Crisis,” Harvard Business Review, 83(2): 72.

Ciampa, Dan (2005) “Almost Ready: How Leaders Move Up,” Harvard Business Review, 83(1): 46.

Friedman, Stewart and Kathleen Saul (1991) "A Leader's Wake: Organization Member Reactions to CEO Succession," Journal of Management, 17(3): 619.

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Longshore, George (1993) "CEO Succession Planning - A Critical Step for TQM Hospitals," Trustee, 46(9): 24.

Miller, Danny (1993) "Some Organizational Consequences of CEO Succession," Academy of Management Journal, 36(3): 644.

Selznick, Philip (1957) Leadership in Administration. New York: Harper & Row.

Stogdill, R. (1974) Handbook of Leadership: A Survey of the Literature. New York: Free Press.

Trice, Harrison and Beyer, Janice (1993) The Culture of Work Organizations. New Jersey: Prentice Hall.

Van Fleet, David (1991) Behavior in Organizations. New Jersey: \Houghton Mifflin Company.

Walker, Tracey (2005) “Smooth Leadership Transitions Begin with Succession Planning,” Managed Healthcare Executive, 15(1): 13.

Yukl, Gary (1994) Leadership in Organizations. New Jersey: Prentice Hall.

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