Chapter 9: Hope For Organizations’ Souls
“Employees and the organizations in which they work are often unaligned in important ways that create tensions, dilemmas, disappointments, and challenges between them. Employees, for their part, often are highly concerned about employment security and receiving sufficient and fair compensation. In addition, they might be worried about not having attractive professional
development or advancement opportunities, satisfactory relationships with their bosses and colleagues, or meaningful, interesting, and challenging work. They might not be given suitable recognition and respect by their organization or the freedom to do their jobs as they think appropriate. They might feel out of the know about their organization’s overall objectives, strategy, and what their leaders consider most important. We can understand, therefore, why
employees might regard their employer with a healthy dose of anxiety, reserve, and mistrust and, as a result, feel an unwillingness or inability to fully engage in their work.
At the same time, leaders of these organizations are generally most concerned about their own objectives, which tend to include growth, meeting their agreed objectives, and charting a future strategic course. They worry about resource sufficiency and allocation and the need to balance different stakeholders’ interests. They must respond to threats and crises and seek to leverage their organization’s resources and opportunities. Thus, even if leaders and managers genuinely want to address their employees’ concerns and hopes, many of them at all levels in an organization lack sufficient awareness, sensitivities, know-how,, self-confidence, delegated power and freedom to act, and resources to be responsive and to lead and manage effectively. The associated costs to an organization that lacks alignment between leaders and employees can be large: employees can become disgruntled, frustrated, and under-fulfilled. They can lose their passion, lose hope, disengage, focus on their own well-being rather than the overall organization’s objectives, and become dispirited. If many employees respond in this way, overall organizational performance will decline to a level well below its potential.
Improvements to unaligned organizational dynamics and performance results can be slow to occur when incumbent management is stuck in its ways, unaware of employees’ problems and dissatisfactions, uncertain of how to deal with employees’ concerns, or devoted to a different set of challenges and priorities. Even when new leaders or managers are brought in, time is required
for them to assess the problems, determine the best ways to move forward, and implement improvements. For many employees and organizations, then, the workplace environment and organizational performance fall considerably short of aspirations and expectations. Hope for better possibilities has only a weak foundation. As emphasized throughout this book, however, employees and organizations can find the bases for many positive and satisfying results from engaging together–if they find or reclaim the five principal elements of their organization’s soul and employ the power of a robust soul for the good of the overall organization.”
Dodge and Cox: A Case Example
Dodge & Cox sustains its strong and stable 80-plus-year soul by keeping alive its founders’ core beliefs, philosophies, and learning, which, as you will remember, include a commitment to financial conservatism, a long-term investment perspective , and perceptions that banks and brokerage firms were not generally aligned with clients. You might also recall that the firm’s founders undertook a 15-year effort to launch the investment management firm during the Great Depression and World War II. Dodge & Cox’s soul was also nourished by the successful and satisfying partnerships formed during those highly challenging, foundation-building decades, as well as by the organization’s high-minded desire to “bring the force of some order into a rather chaoti investment world.”6
The firm’s evolving financial success in the 1950s and 1960s validated its conservative, long-term, value-oriented investment thesis and reinforced the core beliefs, values, and practices on which the firm was built: Do the right thing for clients,7 remain independent and privately owned, utilize a multiperson and cautious long-term investment decision process, and share the firm’s financial success with employees. In the 1980s, 1990s, and 2000s, various management practices and decisions continued to solidify, reinforce, and reflect the firm’s essence. One of these decisions was to keep the firm relatively small and housed in a single office suite to facilitate easy interactions among staff. In addition, leaders avoided outside ownership of the firm in order to maintain its independence in investment decision-making and its overall alignment with clients’ interests. Employees were not rewarded for asset gathering or sales activities, so their attention remained on investments analysis and decision-making. As related in 2011 by Gregory Serrurier, vice president and portfolio manager, “here remains no one who is compensated based on new business, no culture that stops client work based on account size or even measures the size of the business in each relationship, any more than existed when I arrived in 1984.”
6 E. Morris Cox and Lawton Kennedy, “Dodge & Cox: The First Fifty Years.”
7 A senior employee spoke about his early years with the firm: “Mr. Dodge and Mr. Cox always used to lecture us, ‘Be sure you emphasize the clients you have. Don’t worry about getting new ones. If you do a good job with the ones you have, you’ll get new ones.”