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 / Second Quarter 1997 / Issue 7(originally published by Booz & Company)


What the Heck Is a Company, Anyway? Reflections on Identity

What, then, is a corporate leader to do, as he or she tries to balance the need of employees and customers for a feeling of tradition and belonging against the need for efficiency and economic rationality?

The first thing to do is to recognize that people need to group up, and they will do so whether their bosses want them to or not. The key to managing and projecting a corporate identity is to understand how these tendencies to form groups operate -- and then to work with them, not against them. (For a list of practical tips, see the box on page 43.) People quickly and easily form tight group bonds, and use those bonds to reckon where they stand in the world. Even people lumped randomly together will start to feel a sense of Us versus Them with little prompting. Research done more than a decade ago by the social psychologist Henri Tajfel revealed that people would show favoritism for members of their own group, even if the group had just been created by the researcher that morning and consisted of all the volunteers who shared a particular last digit in their Social Security numbers.

The loyalty that people have for a company, then, can feel primal even if, objectively speaking, it can't be that deep. "I've never done a name and position project in which there weren't many people in the company saying, 'Why are we changing?' " Mr. Roth says.

Indeed, people are so attached to the notion of their corporate existence that they tend to exaggerate
the stability and tradition of the past. Like Scots who can be passionate about the clan tartan even though that tradition dates only from the 19th century, corporate people can be passionate about sticking to a logo or a slogan, as if it were the flag or church on Sunday.

"People at Lucent thought, how could we live without the Blue Globe?" says Mr. Roth, referring to the 1996 spinoff of the former Bell Laboratories from AT&T and the loss of the parent's ubiquitous logo, which looks a bit like Darth Vader's death star. "I said, 'Hey, guys, this has been your deep long ancestral tradition since all of 1984.' "

Such experiences suggest that even though a corporation may never warm the heart the way a family tree might, it nonetheless pays to take on the trappings of older social institutions -- flags, rituals, signs of mutual care and obligation. Mr. Roth, whose late father worked at Procter & Gamble for 35 years, points out that that company "is a brotherhood." Employees came to expect and value gestures that reminded them that they formed a community, whose benefits extended beyond the paycheck. "Every Christmas my mother still gets a Christmas basket," Mr. Roth says.

That kind of reinforcement largely went out of American corporate culture in the 1970's, and the 80's were, as Mr. Roth puts it, the decade of "every man for himself." Now, he speculates, the pendulum may be swinging back to a concern for community and shared purpose within the corporation.

"My guess is we're sort of reinventing the corporate connection now," he says. "One key difference from the 70's is that I can reach anyone in our company in 30 seconds. I think the wired network is changing the future. Might we be getting back to a more loyalty-driven company? Hard to say."

If indeed loyalty is coming back, it may well be because wise leaders know that their people need the tokens of belonging -- the "family feeling" that employees and customers alike praise when they find it. So it behooves managers to look for signs of group identity that promote good work -- gung ho team spirit, a company emblem of which employees can be proud -- while watching out for the formation of groups that might pull against corporate goals: the regional office that thinks of headquarters as the enemy, for example. In some
cases, this means leadership requires not giving direction, but taking it. In other words, not declaring what groups may exist in your company, but going out and seeing those that have already spontaneously formed.

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