Breckenridge Institute

Differences between For-Profit and Non-Profit Corporations

2010-03-29T07:02:00.000-07:00

When we look beyond an organization’s Internal Revenue Service (IRS) non-profit status as reported on their IRS 990 Form, many of the distinctions between For-Profit and Non-Profit corporations become operationally meaningless when viewed from the structures-and-systems perspective. As Peter Drucker states, “The differences between managing a chain of retail stores and managing a Roman Catholic Diocese are amazingly fewer than retail executives or bishops realize. The differences are mainly in the application rather than the principles.” Many of the timeless principles that produce sustained financial and non-financial performance in high-performing For-Profit companies can also be applied to Non-Profit corporations, as described by Collins in his monograph, Good to Great and the Social Sectors. In fact, contrary to the view taught in many business schools, recent studies such as Collins and Porras’ Good to Great have shown that profit and wealth are not the driving force or primary objective of truly visionary For-Profit companies. Rather, For-Profit companies have a larger purpose in life, and this purpose becomes the focal point on the business horizon, guiding every decision they make. Generating revenue becomes a means to an end for truly visionary For-Profit companies, not an end in itself.

Eliminating Invisible Bureaucracy

2010-03-15T06:52:00.000-07:00

One of the problems with identifying and eliminating the kind of Invisible Bureaucracy that frustrates and undermines organizational performance is that managers and staff members are actively involved in the patterns-of-interaction that create and sustain this bureaucracy and don’t recognize it because these day-to-day operations are on autopilot.

Organizational Culture Video

2010-02-21T15:54:00.000-08:00

We just finished a new video on my book, Making Invisible Bureaucracy Visible: see http://www.breckenridgeinstitutevideo.com/index.html

New Book on Organizational Culture

2009-09-14T19:42:00.000-07:00

Mark Bodnarczuk's new book entitled, Making Invisible Bureaucracy Visible: A Guide to Assessing and Changing Organizational Culture is now available on Amazon.com and at local bookstores.

Creating an Intended Culture

2009-09-01T22:24:00.000-07:00

The process by which organizational culture is formed has many things in common with the formation of personality. In terms of personality formation, by the time we’re old enough to know that we have a personality we’ve had no hand in fashioning it. In much the same way, an organization’s culture is like its personality and many managers wake up one day and find themselves with structures, systems, and a culture that they have not consciously chosen; in business relationships that may not be in their best interest; with assumptions about generating revenue and patterns of spending that they have not consciously chosen; with employees who are not matched to the organization’s human capital needs; pursuing objectives and goals that don’t produce the desired financial and non-financial results.

One of the keys to understanding and changing this “unconscious” aspect of culture formation in organizations is to become aware of the degree to which an organization’s culture is intended or unintended. An Intended Culture is consciously configured to achieve an organization’s desired results; e.g., its goals and objectives. An Unintended Culture tends to be riddled with ineffective autopilot operations and Invisible Bureaucracy that derail, frustrate, and undermine organizational intentions as embodied in its goals and objectives. Even outstanding organizational performance may be episodic and short-lived because it is an artifact of the specific configuration of internal and external environments within which the organization exists, rather than the result of an Intended Culture. The ability of an organization to change and adapt with conscious intention is the true test of the degree to which its culture is consciously chosen for specific ends.

The approach to creating an Intended Culture described in Mark Bodnarczuk’s new book, Making Invisible Bureaucracy Visible will help you transform your organization’s culture into a powerful resource that effectively performs day-to-day operations on autopilot; e.g., effectively and seamlessly without thinking about them. When done effectively, autopilot operations can be your greatest ally because they increase your ability to compete and achieve your goals. But in most cases the autopilot operations that typify an Unintended Culture are self-defeating because they perpetuate problems with work performance, communication, interpersonal conflict, and decision-making and then derail attempts to create positive change. This unique approach to creating an Intended Culture helps managers take ineffective operations off autopilot, reconfigure them, and then migrate them back to autopilot operations that produce the desired results. Understanding how these invisible forces actually work begins to transform “culture” into a more reliable resource that can be used to achieve an organization’s goals and objectives.

Focusing Organizational Culture Change on Business Challenges

2009-08-17T19:31:00.000-07:00

We are convinced that the process of assessing and changing organizational culture must be focused on real business problems – issues that managers care about deeply. It’s a mistake to lead with cultural analysis and cultural change. Assessing and changing organizational culture is of little value unless it is linked to (and motivated by) one or more of these six interdependent dimensions of organizational life:

Generating and retaining revenue

The effective use and cost of labor as human capital

The effectiveness and non-labor-related cost of operating an organization

Key performance indicators that measure an organization's performance with high precision

The identification and reduction of squandered time and energy

A focus on sustainability, creating value, and making long-term investments in human, material, and financial resources

If the activities associated with assessing and changing organizational culture cannot be meaningfully linked to one or more of these six dimensions, then they should probably not be done. Diagnosing and changing organizational culture for its own sake is an academic exercise that provides little or no value to organizations and the managers who lead them. But if an organization needs to develop a new strategy or strategic plan; improve its execution and day-to-day operations; implement new IT infrastructure; seamlessly integrate business systems; build bench-strength in leadership and management skills; or improve the decision-making and consensus process for the allocation of human, material, and financial resources, then understanding how its culture positively and negatively impacts these issues is not only value-added, it’s probably necessary. The key is to lead with a concrete, tangible business issue, not the study of organizational culture as an end in itself.

Speaking Up about Organizational Culture Requires Courage

2009-08-03T07:46:00.000-07:00

One of the most difficult tasks of exploring the cultural norms upon which the day-to-day operations in companies are based is that they are tacit, unquestioned, and taken-for-granted assumptions that are undiscussible. In some organizational cultures, speaking openly and publicly about changing the cultural norms upon which ineffective processes and poor performance are based is viewed as "political suicide" even if these changes would lead to improved performance and deep, profound, sustainable change. So speaking up about organizational culture requires courage on the part of managers and staff members, especially in the face of real (or perceived) retribution for speaking the unvarnished truth.

Making Invisible Bureaucracy Visible

2009-07-28T11:27:00.000-07:00

It's been some time since we've posted to our Blog because we've been very busy writing books... So we thought we'd post the text from the back cover of Mark Bodnarczuk's forthcoming book, Making Invisible Bureaucracy Visible: A Guide to Assessing and Changing Organizational Culture as well as the editorial reviews so readers can see what people are already saying about it.

Most managers struggle against the flow of overly complex systems and are frustrated by an invisible force that undermines their attempts to effect positive change. Their instincts tell them that the organization's structures, systems, and culture are preventing them from getting the results they want, but "culture" has remained one of the least understood aspects of organizational life - until now. This book reveals how organizational culture can act like an Invisible Bureaucracy that frustrates and undermines organizational performance. The author argues that assessing and changing organizational culture is of little value unless it is focused on real business challenges. Understanding how the forces of Invisible Bureaucracy actually work begins to transform "culture" into a reliable resources that can be intentionally used to achieve an organization's goals and objectives. Like a pair of infra-red glasses allows you to see things at night, the material in this book will make Invisible Bureaucracy visible. Once you've learned to "see" differently, you'll never view organizations (or the people in them) the same way again.

"Bodnarczuk makes organizational culture understandable, practical, and usable. His numerous concrete examples give life to a simple yet comprehensive theory of culture, making both the quantitative and qualitative aspects of day-to-day operations in organizations meaningful. Any serious student of culture, change, or organizational assessment will benefit from reading and using this book." Richard Bents, Ph.D., Founding Partner, ShareOn, Corporate Leader Resources.

"In this important new book, Mark Bodnarczuk has given us tools for working objectively with that elusive subject, organizational culture. He frames the subject as an integration of the "hard" structures-and-systems school, on the one hand, and the "soft" human performance perspective, on the other - asserting that understanding culture brings the two together. His rigorous methods ensure that the hidden or auto-pilot aspects of organizations can be brought into awareness to increase flexibility and effectiveness. These are powerful ideas in an era of rapid change and innovation." Don Fowke, SM, P.Eng. FCMC, Co-Founder, New Management Network.

"If your organization is interested in sustainability, then culture competence is a must. Mark Bodnarczuk's book is an essential "radar" system for doing transformational work in today's organizations. Making Invisible Bureaucracy Visible guides and supports the kind of organic cohesion that companies need in these turbulent times. I have waited a long time for an excellent and professional approach like this!" Reiner Blank, Ph.D., Future Systems Consulting, Hamburg, Germany.

"I've read as many books as I could find over the years on "culture" in search of a guide to provide a practical model and guidance for understanding the tacit and explicit forces that drive the cultures that human beings create. Mark Bodnarczuk has provided the most complete guide the reader will ever find. In one of the more remarkable achievements in this field of study and practice, Making Invisible Bureaucracy Visible, will make the invisible and heretofore fuzzy concepts about culture very visible, clear, pragmatic, and ultimately useful." Roger R. Pearman, Ed.D. author of Hardwired Leadership.

Making Invisible Bureaucracy Visible will be available on Amazon.com and at local bookstores by mid-September.

Ten Guidelines for Managers Who Want to Create Culture Change

2008-04-02T10:48:00.000-07:00

A common perception is that cultural change has to start at the very top of an organization. But field experience has shown that culture change can begin with the sub-culture of a work-group where a manager who is one or two levels down from senior management decides to become and Island of Excellence® in a sea of mediocrity. As objective evidence of believable, performance improvement becomes known to other managers, change often goes horizontal across the organization through other work-groups, then up through the line organization to top managers. The Breckenridge Institute® has developed ten guidelines that managers should follow when under-taking this kind of culture change (see list below).

1. Make sure that the changes you propose are in the best interest of the overall organization, not the self-interest of your work-group.

2. Solve your own work-group’s problems first and become an example of change.

3. Create your own organizational “space” and obtain additional resources based on the value you add.

4. Align your work-group’s vision with other work-groups, departments, and functional units by focusing on the things you hold in common and contribute to achieving the purpose and goals of the overall organization.

5. Communicate the trade-offs of actually accomplishing change to work-group members.

6. Manage meaning for people both in and out of your work-group so changes are interpreted through the “lens” of your work-group’s vision.

7. Only engage in constructive conflict with other work-groups or managers, and only do this when you have to for the best interest of the overall organization

8. Cultivate allies who will support the change and form open coalitions to ensure that change is sustainable.

9. Create a concrete, tangible path forward with credible next steps and a well-defined picture of the value-added that the change will bring to the overall organization.

10. Find and use exemplars (measurements) to reinforce the fact that change is actually happening and also to accelerate change.

While the specific application of the ten guidelines will change from organization to organization, the principles will hold true in for-profit, non-profit, and government organizations.

The Culture Equation

2007-11-08T06:59:00.000-08:00

Ground-breaking studies like Jim Collins’ books (Built to Last and Good to Great) and John Kotter’s book (Corporate Culture and Performance) have shown that while an organization’s culture powerfully molds its operating style and can positively (or negatively) affect the performance of work-groups and entire organizations, “culture” has remained an overly-complex and somewhat mysterious topic for most organizations – until now. Research conducted at the Breckenridge Institute® has identified the constituents of organizational culture and formulated them into a Culture Equation™ that describes what organizational culture is in simple, concrete terms (see below).

POI ↔ COI ↔ ROI = Current Results™

Our work has shown that managers can use this simple equation to improve performance at the organizational, work-group, and individual employee levels simultaneously. The terms of the Culture Equation™ are defined as follows:

POI = Pattern of Interaction (Informal Rules, Actions, Group Learning)

COI = Context of Interaction (Formal Rules, Structures, Systems, Location)

ROI = Repository of Interaction (Tacit Assumptions, Belief Structure, Meaning, History)

Current Results = The Actual Results an Organization Gets, Not its Goals

The key insight is that organizational culture is composed of all four terms in the equation, with each term being a distinct (but interdependent) category of business elements that interact with the others to produce an organization’s financial and non-financial results. It is the interaction of the four terms that creates organizational culture.

Here’s how the four elements work together to create organizational culture. Day-to-day operations occur as patterns of interactions (POI) within the context of interaction of an organization’s structures and systems (COI). Over time, the interaction of POI and COI functions like a group learning process that creates a repository of interaction (ROI) that becomes an organization’s knowledge-base and the tacit beliefs that managers and staff members have about the organization and the people in it. Over time, these first three elements settle down on an organization-wide pattern of interaction (POI) within the larger context of interaction of the business environment (COI) and the combination of these elements produces the financial and non-financial results that an organization actually gets. This is the underlying process that Dave Hanna is describing when he says that, “All organizations are perfectly designed to get the results they get.”

Most culture theorists have a primary focus on one or two of the terms in the Culture Equation™ as the key elements that define organizational culture, but few systematically consider all four terms and their interrelationship to one another. For example, Edgar Schein focuses primarily on tacit beliefs and assumptions (ROI) that exist within the organization's context (COI); David Hanna focuses primarily on observable work habits and practices to explain how the organization’s culture really works, e.g. the interaction between POI and COI as producing an organization’s Current Results; and John Kotter and James Heskett focus on linking Current Results to the level of flexibility in the POI as found in Theory I: Strong Cultures, Theory II: Strategically Appropriate Cultures, and Theory III: Adaptive Cultures.

Bottom Line: Whether a leader is the founder of a new company or a top line or middle manager in a well-established company, one of their most important tasks is to create, manage, and (if necessary) to destroy organizational culture in order to get the desired results. Our work at the Breckenridge Institute® has shown that the primary way this can be accomplished is by using the precise definition of culture provided by the Culture Equation™.

What Our Research Is Saying About Organizational Culture

2006-06-09T11:07:00.000-07:00

The Breckenridge Institute is conducting research on the formation, operational characteristics, and corporate life cycle changes of organizational culture. We're finding that an organization's culture is like its personality, with unique patterns of financial and non-financial performance that are revealed using the Breckenridge Culture Indicator (BCI). We are using advanced statistical techniques like factor analysis to identify effective and ineffective patterns of organizational performance, which subsequently provide a quantitative basis for organizational improvement and change initiatives.

The frenetic pace of today's global economy has increased the need for fact-based decision-making using scientific analysis, not just business experience and intuition. The research being conducted by the Breckenridge Institute staff promises to yield the kinds of tools, methodologies, and quantitative information needed to help leaders and managers make informed decisions and to transform their organization's culture into a more reliable resource.