Leading Culture Change at Seagram

Issues

Seagram’s senior management’s greatest business challenge has been maintaining an image of who they are to both the world and to employees. Much of this challenge is due to a lack of effective communication as a culture. Additionally, the company has been structured in a hierarchical fashion. This configuration has not allowed for a culture that is innovative, cooperative, communicative, and customer focused.

Issue Analysis

So far Seagram has quickly and commendably executed their cultural change. Since 1992, when operating income growth experienced significant sobriety, Bronfman and executives have successfully reinvented their image, not only culturally; but have expanded globally, stimulated the excitement and enthusiasm of hundreds of employees throughout Seagram through their reengineering efforts, and have developed a strategy to improve behavior and business processes by listening and responding to employees through vehicles such as focus groups.

Additionally, Bronfman has increased the innovative efforts of his departments by virtue of his actions to identify the true needs of customers via examination best practices of other companies. This process took almost nine months to adequately achieve. Over the course of this examination, Bronfman’s efforts must have inspired senior executives and other employees innovate and become more collaborate in many departments.

One of the most pivotal steps Bronfman has taken to gain the trust and support for developing an underlying set of values has been involving his constituents in the process of developing the values in focus groups. This intimate setting allowed employees who represented all businesses, all functions, at all levels, to have a voice on whether or not creating a set of values was important in improving the day-to-day work environment. Not only did management ask for their opinions, but they went a step further to involve individuals by inviting them to make suggestions about how to introduce and communicate the values. As an employee this communicates that their opinions are valued, and that leaders want to develop qualities worthy of promotion in the company. Employees may take this principle of “focusing on what the person is becoming” and then apply it to their customers.

Bronfman has provided senior and general management a great mentor and exemplar of how to lead. He has especially demonstrated this in how to act in uncertain and unfavorable circumstances. The 1990’s were full of setbacks and disappointments for Seagram as they faced increased taxes on liquor, a recession, increased regulation, etc. and yet the company is moving forward enthusiastically toward becoming the “best managed company and growing 15 percent. If a member of the senior management executives becomes Chief Executive Officer (CEO), they will know how to respond to competitive forces without having to read a description of duties written of what makes a successful CEO at Seagram.

Bronfman’s understanding of the root motive for effective implementation of the cultural differences was not completely accurate or effective. Often he would emphatically declare that values will be the primary stimulus in changing behavior. This is a fallacy. There is a better way. Rather than focus as much time and attention as they have creating a “corporate religion,” it seems that the focus of the corporation should be to continue moving the new organizational context forward. This context has been developed within the new business processes.

Developing new business processes will cause the change in attitudes and behaviors senior management wants to have as a driving force of affectivity.  As processes are more distinctly adopted with the departments of the company, new roles will be imposed, new responsibilities, and new relationships of communication will be direct results of placing and guiding people into the new organizational context.

Recommendations

The most time, cost, and emotionally effective decision executives can make moving forward is related to how management will adopt the cultures of various departments within the company. Leadership should advertise “The Seagram Values” to be used only as a measuring stick of how to act given department-related circumstances. The values should be used as a method of communication of what type of employees work within Seagram, but not as a measure of success.

The true measure of success will be in the growth of individual departments within the company. Each department will be expected to meet with their direct manager in order to determine how the values specifically apply to their department. Even more specifically, individuals will sit down with management to determine how the values relate to their distinct operational, day-to-day tactics within their role. Employees will be expected to provide a measurable goal that includes a date to achieve various objectives.

Management’s role in assisting success will not be through micromanaging the goals developed by individuals within their department, but will consistently create a climate of that empowers the team with resources that can help facilitate needed changes. Additionally, management will be expected to report the overall direction of the department as it relates to a company-wide objective, examples of how employees are implementing the values of the company within their sector of operations, and how individuals are going to grow within the company. This meeting will often result in higher management sharing other lessons of both success and failures of other various departments. Lastly, after discussing the needs of the division, it may be determined that specific employees need to be moved into another role within the department or into another area within Seagram in order to continue to stimulate a climate for change.

When employees are moved into new roles they will have opportunities to develop new competences and be provided with greater opportunities to innovate and grow into the future leadership of Seagram. This pattern interrupt will increase participation in Seagram’s vision to continue diversifying in their market segment and will better equip the individual to adapt to change in the future. This person should become a significantly greater asset to the company and in society as they increase their capability to adapt to a changing competitive environment.