Corporate culture rules

 

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I’m a big fan of Jean-Louis Gassée, former Apple executive, or more precisely a fan of his Monday Note Newsletter. (I was not a fan of his when he was at Apple running the Macintosh division, but that’s another story.)

JLG has been delivering his high tech bio on the installment plan via Monday Note. He worked for six years at Hewlett Packard, then moved on to become CEO of the French affiliate of Data General.

But by far the most interesting read for me as a mentor to founders was the story of JLG’s tenure as CEO of the French affiliate of Exxon Office Systems, entitled 50 Years InTech. Part 4: The Exxon Delusion.

Exxon hired the Boston Consulting Group, after two oil supply crises in the Middle East. BCG convinced them that Information Is the Oil of the 21st Century. That lead the execs of Exxon to form the Exxon Information Systems to lead the company into its post-oil future. And JLG was hired as the tech savvy CEO of Exxon Office Systems.

Exxon invested $2 billion in this new division, back when $2 billion was real money, not pocket change for the likes of Jeff Bezos et al. And in a typical BiGCo move the first thing they did was buy a disparate bunch of tech companies. Exxon ended up spending another $2 billion on Exxon Information Systems before realizing the error of its ways and going back to “oil is the oil of the 21st century.” You can get the painful details from JLG’s newsletter.

The important take away for JLG was the power of culture, and the negative power of disparate acquisitions.

It was an exciting time, but I soon saw Exxon for what it was: An out-of-its-depths organization that had no feel for the world of bits and bytes, hardware and software engineers, end-user sales and marketing. For Exxon leadership, these concepts were just that: Ideas without a reality. It was impossible for them to make the right choices.

To JLG Exxon, courtesy of Boston Consulting Group, actually had the right idea about information being the oil of the 21 century, but totally lacked the culture to execute. And in companies gigantic and tiny it’s all about execution.

JLG’s comments on corporate culture should be your take away from  this blog piece:

Culture isn’t a set of rational dicta. Culture works below our consciousness, processing, filtering, and labeling raw data before passing the result to our “waking” selves. That’s how we end up with Obvious Truths, that’s how we get to the powerful and destructive It’s How We Do Things Here.

Whether you are building a startup or joining one, the corporate culture will decide your fate. Everyone talks about product/market fit; no one seems to talk about idea/culture fit. But it’s just as important, if less obvious. A venture can recover far more easily from a product/market misfit than from an idea/culture misfit.

 

Author: Mentorphile

Mentor, coach, and advisor to entrepreneurs, small businesses, and non-profit organizations. General manager with significant experience in both for-profit and non-profit organizations. Focus on media and information. On founding team of four venture-backed companies. Currently Chairman of Popsleuth, Inc., maker of the Endorfyn app for keeping fans updated on new stuff from their favorite artists.

One thought on “Corporate culture rules”

  1. Love this post. I had a similar experience at Simon and Schuster Education. You cannot succeed in a business that sees technology as a graft to try to grow a new branch.

    Like

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