Organizational Consulting - Beta Oil
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beta_oil.docx“Beta Oil”
This case illustrates the culture-deciphering process in a project that did not initially involve the total corporate
culture directly but instead required that we clarify the culture to accomplish the goals of the project. Beta Oil
restructured its internal engineering operations by combining all of engineering into a single service group.
Previously, the eight hundred engineers involved had been working for various business units, refineries, and
exploration and production units as members of those organizations. In the new, centralized organization,
they would work as consultants to those organizations and charge for their services. The formal rules were that
all engineering services would be charged for, with the fees to the various internal customers sufficient to cover the costs of running the eight-hundred-person engineering unit. The business units that would “hire” engineers
to build and maintain the exploration, production, refining, and marketing activities could either use the internal central group or go outside for those services. However, the engineering services unit could only sell its services internally.
I learned all of this from the internal OD manager assigned to this central services group, whom we will call
Mary. She was charged by the manager of the unit with forming a “culture committee,” whose mission was to
define the so-called new culture of this unit as it evolved into its new role. It was recognized that the individual engineers faced a major change, from being members of a business unit to being freelance consultants who now had to sell themselves and their services, and who had to bill for their time according to a preset rate. Mary
recognized that creating a new culture in this unit was intimately connected to the existing culture in the larger
company, since both the engineers and their customers were long-time employees of Beta Oil. It was
also recognized that the engineers were coming from subcultures, and one problem was to create a single culturefor the new unit.
After several hours of conversation with Mary to plan how the culture committee could function effectively and what kinds of intervention might be needed, we decided that we had to do an assessment of Beta’s corporate
culture. I was to be the facilitator, and she would bring together a group of fifteen or so engineers and
managers from the unit. The workshop devoted four hours to a discussion along the lines described above:
1. Polling the group to get consensus on the business problem: the evolution of a new way of working and new values for the service unit in the context of the realities of the Beta culture
2. Explanation of the culture model
3. An hour or so on artifacts
4. Focusing on the espoused values
5. Exploration to identify the underlying shared tacit assumptions
6. Exploration of which of these assumptions would help or hinder the evolution of a new way of working in
this unit
The meeting was successful in identifying a number of important assumptions. Mary, some of her colleagues on the culture committee, and I all felt that one or more additional groups should be run to flesh out the picture and check our perceptions of what we were hearing. Over the next several months, two more groups were brought
together for half-day meetings, leading to a coherent picture of the present corporate culture. The motivation for defining this picture was that the senior management committee of the unit needed to be involved if new ways
of working and values were to be pro-mulgated. Giving them feedback on the culture as we were beginning to
see it provided the agenda for a working session with this group. They would elaborate the culture assessment
and then make some decisions on what action steps they needed to take to define a new way of working,
consistent with their new values. I decided to give the cultural feedback as much as possible in terms of the
language that the assessment groups had used. I also decided at this stage to present“themes” rather than trying
to generalize to very abstract concepts, because we wanted the management group to become involved in the
assessment process as well and felt that giving them themes would be more concrete. Higher-order
generalizations could then be arrived at together during the meeting.
Exhibit 31.2 presents the document that was shared with the management group. I commented briefly on each
theme during the meeting and encouraged members of the group to comment on how accurate this was in their
own experience.
ORGANIZATION DEVELOPMENT
I. Assumptions about the nature of the work to be done
• The organization is energized by identifying problems and developing fixes.
• It works by quick fixes of whatever problems are identified (“fire, ready, aim”).
• It is assumed that if you break a problem down into small enough pieces and fix each piece, the big problem
gets solved (blindness to interdependencies).
• Problems are recognized and named once variances get high enough. Management then steps in with a quick
diagnosis and fix, sets up a new structure or remedial process, and then relaxes and does not follow through on
implementation (for example, shortfall on cost recovery).
• We have a “hero” culture: waiting for problems to get serious, then fire fighting and rewarding the successful
fire fighters (“But remember, a culture that rewards firefighters breeds arsonists”).
• Quick fixes are always new structures and processes, and once a new structure or process has been put in place the job is done. Implementation is someone else’s problem.
• All dilemmas and predicaments are viewed as problems to be solved and are thus subject to the quick
structural-fix response. No sensitivity to the complexity of “soft” issues or the difficulties of implementation
after a new structure or process is announced.
• Fixes are often the creation of teams or groups, and once a team is formed it is assumed that the job is done
(but the culture is basically individualistic; hence teams may not function well).
• Getting involved with implementation is avoided because it exposes you to failure.
• It is assumed that fixes will sell themselves.
II. Assumptions about people and their motivation
• It is assumed that people can and will work on their own, that they are highly motivated and dedicated (that is, management does not have to micromanage).
• It is assumed that people will be successful; success is expected and taken for granted.
• It is assumed that people have no ego or social needs on the job.
• You must be willing to sacrifice for the company by working long hours, taking two briefcases home, etc.
Nowadays, everyone has two jobs and is expected to be able to do them.
• It is assumed that groups can work on their own and set their own priorities (but there is a sense of lack of direction by management).
III. Assumptions about the management process
• The organization is procedure- and numbers-driven.
• It is all about dollars and costs.
• Surfacing costs is a good thing.
• The organization is numbers-oriented (for example, numerical target for how many people to have in the
organization).
• The organization operates with a command-and-control mentality.
• It is assumed that “management decides; others do” (example: when there are jobs to be filled, management
just decides who will fill the jobs, with little or no consultation).
Exhibit 31.2. Culture Themes Identified in the “Beta Oil” Assessment Workshops.
So How Can You Assess Your Corporate Culture?
• There is very little accountability and great latitude, especially in the intangible or soft areas that are harder to measure.
• Teamwork is espoused but the reward system (forced ranking) is highly individualistic, with emphasis on
rewarding “heroes.”
• Engineers run the company. You know who is an engineer right away; they are the golden boys who are white, male, tall, clean-cut, and aggressive but not combative.
• Company is an autocratic/paternalistic family that takes good care of its children (pays well and has generous—but not portable—retirement), provided they are loyal, hardworking, and successful. If they are somewhat
anxious, that is normal and OK.
• A done deal is irreversible.
IV. The organizational “climate”
• Climate is egalitarian, friendly, low-key, and polite, but possibly vicious and blaming when backs are turned.
• We are a punitive, blaming culture.
• You never say you don’t know or admit that you made a mistake.
• No one wants to admit to bad things, but people talk about bad things that happened to others.
• When mistakes or failures are identified, blame is assigned quickly and with out much systemic analysis; the
guilty are named, badmouthed, and labeled, which affects their assignments, but no formal consequences follow.
• There are not many incentives to work together.
• A single mistake for which you are blamed can offset many successes and result in your being labeled and
limited in future assignments and promotions.
• If you are labeled as having made a mistake, it affects whom you can work with in the future, so being
negatively labeled can be very destructive to the career.
• Once you are labeled, it is forever; examples are “superior performer,” “dinosaur,” “not a team player,” “high-potential,” “low-potential,” “not management material.”
• Working overtime is the norm.
• Work is done through relationships, and you work with those people whom you know; you use the Old Boy
network.
• The best strategy for self-protection is building a network of supporters.
• You stay because of the good pay and retirement program (golden handcuffs).
• There is now a climate of fear; the future is uncertain.
• Company used to be a gentle, lifetime employer, but it has had as many as ten rounds of layoffs and
downsizings in various divisions.
• As a consequence, there is a real atmosphere of fear, reluctance to confront or complain, and avoidance or
suppression of conflict.
• Combination of the shift to centralized service with downsizing exacerbates these feelings.
• In a restructuring you can lose scope, rank, or face—but not pay.
• The organization has no obvious supporters.
• Job security is not linked to individual competency.
Exhibit 31.2. Culture Themes Identified in the “Beta Oil” Assessment Workshops
The management group basically bought this picture and confirmed with their own examples that the themes
were accurately depicted. This reflection on their own culture allowed the senior management members to think through their own role. They recognized that the most difficult aspect of the Beta culture was the basic fear of
being associated with any failure, or of being blamed for anything that went wrong. Furthermore, from
the point of view of an engineering culture, they realized how hard it is for engineers to convert themselves into consultants selling themselves and charging clients by the hour.
These insights made it clear that the top priority for the project was to develop a new image of how to work that was consistent with the self-image they had. The culture committee was charged with coming up with a new set of values and practices—the new way of working, which would then be promulgated throughout the
new way of working was to be a concrete description based on the culture assessment and the business realities
that Beta faced. The new way of working had to deal with the structural realities of how the engineering job was now defined, but at the same time it had to fit the larger “blaming culture” in which the entire organization was embedded.
To illustrate the power of an assumption like “You must never be associated with any failure because it can be
career-threatening,” a promising joint venture hit a major snag when it was discovered that the actual project
structures would put Beta engineers into situations where they were subordinate to project managers from the
other member of the joint venture. The whole planning process unraveled because Beta engineers refused to
work for someone from another company. They pointed out that if a project failed, the manager from the other
company could simply disappear, while their association with the failure would be negatively viewed within
Beta. The fact that the manager was from the other company would not be viewed as a valid excuse.
The impact of the cultural assessment was twofold. It made the senior leaders of the organization aware of the
magnitude of the change task they faced, and it made them aware that just announcing a new set of values and
goals would not produce the change they desired. Unless they could specify concretely what the new way of
working was, they could not expect the engineers in the unit to adapt effectively to the new structural conditions imposed on them.
