The Impact of Cultural Fit on Leadership Success

Two cases to consider. First, what is going on at the Big House in Ann Arbor? The legendary Bo Schembechler was head coach at U-M from 1969-1989, taking the team to 17 bowl games in 21 seasons, including 10 visits to the "granddaddy" of all bowl events, the Rose Bowl. Bo was a first-name-only icon on campus. What a time to be at Michigan! What a time to be a football fan! 

Fast forward two decades. Lloyd Carr was the head football coach at the University of Michigan and while he's no Bo, he is recognized as a tremendous leader and coach. The Michigan football program thrived under his leadership from 1995 until early 2008 when Carr retired. Under Carr's leadership, the Wolverines record was 122-40, they won or shared five Big Ten titles, and in 1997 the team was declared National Champs by the Associated Press. In 2008, Coach Carr was even awarded the Bobby Dodd Coach of the Year Award - one of the highest honors awarded to a college football coach.

What has happened since then? Anyone paying any amount of attention to ESPN or local sports pages will know that in his first season as head coach, Rich Rodriguez and the 2008 U-M football team finished the season at 3-9, one of the worst seasons in school history. Michigan's losing record also assured that the team would not play in a post-season bowl game for the first time in 33 years, the longest such streak in college football up to that point.

If you look at Rich's background and experience, he's a good coach. In fact, he was one of the most successful coaches at West Virginia (his prior head coaching position) and while there, was credited with the first back-to-back Top 10 finishes in school history, four consecutive New Year's bowl appearances (joining USC as the only program at the time to do so), the school's first BCS bowl win, three Big East championships, eight wins over Top 25 teams, twenty-six straight weeks in the Top 25, and a 30-6 record from 2005-2007. Rodriguez led the team to six bowl appearances - the 2002 Continental Tire Bowl, the 2004 and 2005 Gator Bowls, the 2006 Nokia Sugar Bowl, the 2007 Gator Bowl, and the 2008 Fiesta Bowl.

Clearly Rodriguez should be able to join U-M's football program and be successful. So what happened? If you listen to the rumors and sense some of the U-M vibe, Rich Rodriguez may not have started off on the right foot when he arrived on campus to lead the football program. He immediately installed an entirely new football staff and made several changes to the strength and conditioning facilities. Some players began to leave the program citing objections to certain behaviors and values. Finally, a week before the 2009 season began several players alleged that Rodriguez violated NCAA rules regarding practice schedules.  

How much more negativity can this program handle? More importantly, will Rodriguez be able to dig himself out of this hole and lead the team to a return to its more prestigious foundation? Did he come into an established school and football program with a definite culture and make too many changes too quickly? Did he not respect the sense of tradition that had already taken root in Ann Arbor?

Let's look at another example. Consider the case of Bob Nardelli. He had a terrific track record of success from his experience as a talented senior executive at GE and J.I. Case Company. In 2000, when it was announced that Nardelli was not chosen as the successor to Jack Welch as CEO at GE, he accepted an offer to become CEO of Home Depot. 

Nardelli had been incredibly successful as CEO of GE's Power Systems business unit instilling efficient process and containing costs. He joined Home Depot and immediately began doing what had worked for him in the past. He dramatically overhauled the company. He changed the decentralized management structure and consolidated divisions. He streamlined operations. He put in place processes and rigor that hadn't existed in the past.

By all accounts, Nardelli did a great job at Home Depot. During his tenure, he was credited with doubling sales of the home improvement chain and improving its competitive position. Revenue increased from $45.74 billion in 2000 to $85.1 billion in 2005. Nardelli was brought in to help the company transition to a mature company from one that had experienced break-neck growth over the past two decades. 

Despite his operational success at Home Depot, Nardelli's autocratic style turned off employees and shareholders alike. He was accused of putting out the entrepreneurial fires that had been an integral part of the company culture under the former leaders and founders. Ultimately, amidst tremendous pressure and negativity, Nardelli was asked to resign by the Board in early 2007.

What is common in both of these situations? Most leaders believe that what has worked for them in the past, what had led to their prior success, will surely work again. That, in fact, is not always true. Not enough consideration is given to the impact of a leader's fit (or lack thereof) with the engrained culture of an organization.

Rodriguez joined Michigan and immediately put in place what had worked for him in the past. He changed out the coaching staff (hiring many members of his WVU staff), installed a completely new offense, did not engage the U-M alumni base or invest in building relationships with that support base. His personality and approach are not the same as Lloyd Carr or Bo - his approach and lack of engagement were perceived by many as a lack of interest.

Nardelli came in and implemented the same rigor and processes that had led him to be successful at GE.  He, too, brought in a number of former GE leaders with whom he had worked before and who held a similar mindset.

In both cases, the importance of the culture -- of the existing legacy -- were steamrolled.  In both cases, deference to the culture of the organization, be it the rich tradition of football at U-M, or the entrepreneurial spirit of Home Depot, were ignored.  In both cases, the fallout from ignoring the culture led to dramatic results for both leaders.

Change is good, no doubt. Too many people get stuck in the past with the "way we've always done it." Bringing in new leaders to provide a different mindset, to deliver a new perspective, or to transition the organization to the next level is a positive thing and has to happen. The bar is always being raised. Organizations need fresh ideas and concepts, especially in our current environment in which the speed of technology and globalization are ever-evolving at a frantic pace.  

Organizations need to be open to change however, new leaders must also be aware of the impact of the culture of the organization. This is especially important where the existing culture is engrained as deeply as it was with U-M or Home Depot. There is something to be said about the back-lash of coming in and making too many changes too quickly so that the essence of the culture is removed, especially when that culture held a rich tradition of success (and arguably this isn't as big of a danger with an organization that doesn't have quite as substantial a legacy associated with it).

Is that what happened here? Were the cultures so deeply engrained at U-M and at Home Depot that genuine attempts to raise the level of organizational performance (which is clearly the objective of any new leader) instead served to create a backlash and negativity such that the leaders were destined to fail?  What impact does preserving some semblance of the culture have towards the immediate success of a new leader? As succession planning takes place, and new leaders are brought in, an intentional look needs to be taken at the existing culture, and the new leader needs to make a decision as to what level of preservation needs to occur. This could be the factor that leads to his or her ultimate job preservation! Just ask Nardelli. The jury is still out on whether Rodriguez will be able to successfully integrate into the program at U-M.  It's been an auspicious beginning thus far.