Thursday, June 28, 2007

Fad-surfing and corralled rebellion

One of the big banks I worked for built a brand new campus for our division. At the time, we were growing but faced many strategic challenges: aggressive competitors were forcing prices down, our credit management area was struggling, our cost structure was higher than the industry leaders, and we were “blessed” with antiquated IT systems.

Yet for six months the new campus was the hot management topic. There would be no offices. Just small cubicles with low walls and lots of open space. There would be all these tables and the tables had rollers so people could just slide them together and collaborate. That was going to spark creativity and innovation and make us a great company.

The whole thing looked like a giant call center that was having a yard sale.

After it was completed, senior managers and visitors came by for tours. They admired the radical design and heard about all the benefits. This was The Bank of the Future. No hierarchy. No department boundaries. Easy collaboration. The dawning of a new age.

Unfortunately, the radical space did not help us address the strategic issues. Competitive pressures increased; credit problems got ugly. Still, we got a fair amount of publicity for our innovative office design. Executives were always happy to talk about that.

The same thing happened with Chiat/Day, the advertising agency. There was a time when they got more press for office space than they did for the ad campaigns they produced for clients.

During the dot-com boom, corporate types were inordinately proud of their internet rebels. All sorts of stodgy companies started bragging about their counter-cultural web geeks housed in funky spaces. For those who did not want to buy their own rebels, consultants like Scient were happy to rent them out.

Much of the impetus for this behavior was just the usual cluelessness and fad surfing. A lot of it was PR: “ACME Widgets isn’t your father’s boring old widget-maker. We get the Web. Look! See there? Our web-designer has a shaved head and wears a nose ring. Check out the goth chick who does our online advertising.”

I think that something else was happening as well. Dig a little bit and you can see the denial hiding behind the radicalism. Executives realized that their company needed to change. They sense that real change, fundamental change, is hard. So they opted for something softer. They would do something that appeared radical, but they would fence it off from the rest of the company. Or they would make dramatic changes but only in superficial matters like desk arrangement.

In short, they would corral the rebellion while they talked of revolution. That way, they never had to change much of anything that really mattered. All the while they could reassure each other that they were bold, and innovative, and cutting edge.

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