Thursday, May 29, 2014

The Smell of the Place – Creating the Right Culture for Success

A couple of weeks ago I was facilitating a session for the South Asian leadership team of a large multinational company on how to create a successful organisation using my High Performing Organisation Model. During the session the conversation turned to the impact the culture of an organisation has on the performance of the company. The president of the company then shared how he recently galvanized his extended leadership team behind a new growth vision of the organisation and he introduced me to a speech by the late professor Sumantra Ghoshal from the London Business School called ‘The Smell of the Place’.

Upon my return to the office I decided to check it out, found the video of the speech on YouTube which was made at the World Economic Forum Conference in Davos and read his speech. I was floored as it articulates in a simple manner the context management needs to create in order to deliver outstanding performance.

He asserts that the quality of management should not (only) be judged by the financial performance it delivers but more importantly by the context it creates for its employees at all levels to maximize their personal contribution.

The title of his speech is related to an analogy in which he compares the impact of spending time in Kolkata in summer and a forest in Fontainblue, France in spring has on his energy level and motivation. He goes on to say that most companies create a Kolkata in summer rather than the more serene spring in France.

From his research he found that it’s possible for companies to create a ‘Fontainblue Forest‘ spirit. It doesn’t have to take a very long time and it can be sustained. Professor Ghoshal mentioned 4 components for how companies can create the right context including:

  1. Stretch

  2. Self-discipline

  3. Support

  4. Trust


Instead of boxing in employees Ghoshal encourages leadership teams to give employees the freedom to do what’s right. Not to overwhelm them with the 4C’s of archaic management (constraint, control, compliance and contract) but to give them space, to let them stretch themselves and allow them to find solutions for their own problems. Through this, the role of management moves to creating an exciting sense of purpose, ambition that is clearly articulated and is exciting to every individual. As Simon Sinek says: ‘People don’t follow you for what you do but for why you do it’.


Ghosal goes on to say:

“The issue is not one of having or not having systems. The issue is what does the management do with the systems. Do you use the systems to impose compliance on me, or do you use the systems to instill self-discipline into my day-to-day behavior? Self-discipline is management by commitment. Self-discipline implies you do what you promise. If you promise a 14% reduction in inventory, you die to deliver that. If there is a meeting at nine, everybody is in the room at nine.”

Enabling self-discipline is one of the first steps to shed Parent-to-Child relationships that so many Asian companies rely on to get work done. Self-Discipline leads to individuals achieving organizational goals from their own free will and drive rather than being forced to work in a 9 to 5 environment.


Can you imagine what you could achieve if people throughout the organisation, from the top team to the receptionist, really believe that their boss along with the management systems and processes exist for one reason alone: to help them win? Managers need to help people win by:

  • Providing personal coaching, guidance and mentoring

  • Helping them gain access to the resources of the rest of the organisation that they may not have access too

  • Allowing them to experiment with new ideas and congratulate them when they make a mistake and learn from it


Trust according to Ghosal is more than ‘I trust him – he does what he says he will do’. It’s more implicit. It’s if you have this badge I will trust and give you the space for you to deliver. It’s about trusting people upfront because you know you don’t have the time for people to earn your trust.

So what smell are you creating; Kolkata in summer or Fontainblue Forest in spring? Do you think any of the seasons is more preferable in Asian countries than the other? As always I welcome your thoughts.

Photo Credit: Eduardo Amorim via Compfight cc and Wikipedia

Source: B2C_Business

The Smell of the Place – Creating the Right Culture for Success

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