An interview with Richard S. Gallagher, author of The Soul of an Organization: Increasing Productivity and Profits by Assessing, Identifying and Improving Your Corporate Culture (Dearborn Trade Press, 2002)

What is the key point of your book?

It looks at how values, and not business processes, are what drive successful organizations. More importantly, it looks at the psychology behind these values - why they are so hard for most businesses, and how you can use this knowledge as a strategic competitive advantage.

You see, most corporate cultures are formed in those hundreds of daily business decisions you make every week. The vast majority of businesses make these decisions based on human nature, while the best ones make them based on core values that transcend this human nature. This fundamental conflict between human nature and core values is at the root of every corporate culture - and the heart of this book.

Why is there always such a conflict between values and human nature?

Take a value like respecting your employees. If you line up 20 managers and ask them if they respect their employees, they will all say, "Duh, of course." But in many businesses, every time something goes wrong, a new rule or policy gets invented. Enough of these rules and policies, and soon you have an culture that tells employees, "We don't trust you, and we don't particularly like you either." Conversely, a company like, say, USAA develops ingrained values of teamwork by treating their employees well, and then they don't need a thick manual to reinforce that sense of teamwork. And Continental Airlines actually had a ceremony a few years ago where they burned their rule book as part of re-inventing their service culture.

If you don't start from values instead of policy, here's where many companies end up: A good friend of mine once worked for a major oil company, and being left handed, he wanted to move the phone to the left side of his desk. First, he asked the company for a longer phone cord - sorry, he was told, that's a capital expenditure that can't be approved. Next, he offered to go to Radio Shack and buy an extension cord himself - and was told that bringing in your own telecommunications equipment was strictly against company rules. He finally solved the problem for himself by quitting the company!

How important are these values?

I have another good friend who is a former chain restaurant executive. A few years ago, he purchased a long-closed family restaurant, re-opened with a completely new management philosophy, and grew it to become one of the top 300 restaurants in the USA - with largely the same food as before! Today, he has built a spectacular new facility, and constantly has lines out the door - even on a rainy Tuesday night!

So what is his secret? It simply feels different when you walk in his restaurants. People like being there. And behind that "feeling" is practically a whole textbook of values - greeting people within 30 seconds, getting to know customers, helping people to their cars, even keeping a few pairs of inexpensive reading glasses around for older customers who aren't used to the dim mood lighting. More importantly, he respects his employees, many of whom have long tenures and large pensions. The values are largely unspoken, but the results are astounding. He rarely advertises, never runs specials, and doesn't just do a little better than other restaurants - he completely blows them away.

The same is true on a macro level as well. Dell Computer started in a dorm room with simple values - sell directly with no middleman, leverage a higher profit margin to create better quality products, and over-invest in service quality. Today, they are the world's largest computer manufacturer, in an industry where over 70% of their competitors have gone out of business. And it isn't because of their supplier contracts, their advertising or their debenture financing. It's because of these values.

Unfortunately, culture cuts both ways. When IBM decided many years ago to set a goal of $50 billion in annual sales, they went agressively after short term profits and failed miserably. Then, under a new CEO who was a computer industry outsider, they got back to their roots of building long-term service relationships with customers. And guess what? Now they are finally reaching the $50 billion per year milestone that eluded them when it was a goal. Their stumbles, and their later success, were all in their core values.

If there is one key message to this book, it is that great levels of success aren't just reserved for Dell Computer or hot new restaurants. It is also the birthright of you and me, by asking one simple question - "what are my values?" - that puts your workplace in a whole new light.

What makes your book different from other titles on corporate culture?

Above all, it is designed to be put to work by managers at all levels of an organization, particularly front-line managers and supervisors. It focuses in very practical detail on how to improve things like your operations, your hiring strategy or your leadership skills, rather than how to "empower your vision." It has step-by-step guidelines, examples from all walks of life, and even a detailed self-assessment quiz - so you can start exploring and improving your own corporate culture right away in Chapter 1.

Tell me about the methodology you used behind this book.

Many books on corporate culture look at successful firms over a period of time, and study what traits their upper management have in common. I decided to come at this topic from a different direction, namely the best practices of what happens on the front line. I started from many of the core, timeless values that have always driven successful organizations, and then did secondary research among a broad cross section from all walks of life to explore how these values are put to work. My sources ranged from personal interviews with senior executives all the way to reviewing literally hundreds of articles in journals and databases.

The result was a fascinating look at how these values work in real life, why they are so hard for most people to implement, and above all, how the best-of-the-best put them to work. Every company says they want teamwork, for example - but Southwest Airlines is built around the idea of "turning around" an aircraft twice as fast as all their competitors, which requires teamwork by force of nature. Similarly, hunger relief agency Concern is built around a deep respect for the people they serve, to the point where they strongly disdain much of the basic terminology of "the poor" and treat them as equal partners in their relief efforts - which helps them create great societal changes with a budget smaller than the average auto dealership.

Above all, this methodology produced a timeless book that will help people see success in a light that they have never seen it before - as a basic struggle between human nature, and core values that transcend that human nature. And over and over again, the book demonstrates clearly how those who choose values over human nature succeed and profit far beyond the rest of their competition, at both a macro and a micro level.

Tell me about your personal background.

I am an engineer by training, and have been part of the management team of numerous high growth technology firms over the past 20 years. My specialty is the management of customer service and support operations, an area where I have published several books and articles over the last decade. (As a little-known bit of trivia, I also edited one of the first textbooks on 3D computer graphics visualization techniques in my former technical life. If you've ever seen the metallic 3D logo at the end of a Dick Clark TV show, that's me!)

I have a strong track record of transforming organizations for the better in my own career. In the 1980s I served as director of customer services with a startup West Coast software firm that went public on the NASDAQ Stock Market within five years, driven by a world-class service reputation. More recently, as head of another software firm's 24-hour call center operations, I have led a team whose performance has improved to create near-perfect customer satisfaction levels and near-zero turnover. And as a strong voice for best practices in the industry, one professional society recently dubbed me "one of the founding fathers of modern customer support."

More importantly, I have had a lifelong fascination with the contrarian nature of success - the fact that you don't create good customer service by exhorting people to be nice, don't create high productivity by holding a stopwatch behind everyone, and don't always succeed by following trendy business processes. I have always felt, strongly, that the single biggest determinant of success is that essence you simply "feel" when you walk through the halls of an organization. The Soul of an Organization is designed to be one of the most pragmatic books to date on how to bottle up that essence, and use it to succeed like you never thought possible. It is truly my magnum opus.

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Richard S. Gallagher is the author of five books including The Soul of an Organization (Dearborn Trade Press, 2002), Delivering Legendary Customer Service (Oasis Press, 2002) and Smile Training Isn't Enough (Oasis Press, 1998), as well as a complete suite of corporate training materials and programs offered through Skills Development International (www.sditrain.com). Visit him on-line at www.rsgallagher.com.