Defining Organisational Culture

In January 1914, Henry Ford and his vice president, James Couzens, stunned the world when they revealed that Ford Motor Company was increasing its employees' wages to a minimum of five dollars daily. Such an announcement of two industrialists giving all that money was unprecedented. You may argue the increase was to justify assembly line speed-ups. Or it could counteract its high labour turnover due to increasingly monotonous assembly line work. Regardless of the reason, an additional item was mentioned casually in their Five-Dollar Day scheme coverage. “Ford employees are to be further benefited by the establishment of a sociological department in the plant,” the Free Press article noted. “Its work will be to guard against an employee's prosperity injuring his efficiency. Employees who cannot remain sober and industrious will be dismissed, but not until an indisposition to become a valuable employee is shown.”

As more details came to light in 1914 and 1915, it gradually became evident that Ford Motor Company's “Sociological Department” was more crucial to its wage reform than it first appeared. Its wage increase was not free or clear to its employees because it was filled with institutional and ideological baggage. It lay entangled in a web of requirements. Employees who desired this new pay rate had to do more than work hard, effectively, and faithfully. They also had to meet specific moral standards and fulfil certain social obligations in family life and personal behaviour.

The five-dollar daily scheme clarified that an increase in wages was linked to a proper private life. In the January press conference, Couzens noted, “Thrift and good service and sobriety all will be encouraged and recognised.” In an interview with Motor World a few days later, he said that employees “who cannot remain sober and industrious will be dismissed, but no one will be let out without being given every possible chance to make good.” To be eligible for the five-dollar daily scheme, the employees had to demonstrate that they did not drink alcohol, physically mistreat their family, and have boarders in their house. They also had to deposit money in their savings account regularly, keep their house clean, and maintain a good moral character.

John R. Lee, the first head of the sociological department, defined its moral mission. He impressed all who knew him as a talented, honest, benevolent man well-suited to the organisation's new social initiative. Lee often told people that the Ford Motor Company's social work began in 1912 when a dependable employee operating a drop hammer began to fall off. A brief talk with the employee revealed the problem in his domestic life. “Sickness, indebtedness, and fear and worry over things that related entirely to the home had crept in and put a satisfactory human unit entirely out of harmony with the things that were necessary for production,” Lee related. Such incidents prompted the company to turn its attention to reforming private life and raising its employees' wages. In particular, according to Lee, the sociological dimension of the Five-Dollar Day plan stemmed from two sources. First, preliminary investigations indicated that men from settled, thrifty, harmonious homes were happier and performed better as workers. Second, the significantly increased wages of early 1914 raised among Ford management a fear that the princely sum of $5.00 per day might trigger irresponsible behaviour among its recipients.

The moral injunctions of Lee and the Sociological Department were codified for employees within a few months. 1915, the organisation published the manual Helpful Hints and Advice to Employees. This forty-one-page illustrated booklet explained the standards and procedures of the Sociological Department in great detail. This appeal was followed by a long list of “hints and advice” for employees. The pamphlet devoted much attention to the issue of home sanitation and living arrangements, for example, instructing workers that they “should live in clean, well-conducted homes and in rooms that are well-lighted and ventilated.” The pamphlet also emphasised personal cleanliness by praising the healthy effects of frequent bathing and abundant soap and water. It insisted that employees not take in roomers or boarders, arguing that such moneymaking expedients endangered wholesome family life by bringing people of unknown morals and habits into the household.

The pamphlet dispensed abundant counsel on the wise use of money. Now that the pockets of Ford workers were filling with the bounty of the Five-Dollar Day, “thrift” became the order of the day: “Every employee participating in profit-sharing is expected to save some part of the profits allowed him. No hard and fast rules can be laid down or adopted in this particular, as responsibilities differ with different persons and families.” However, the sociological department offered guidance about retirement savings, banking with a reputable savings institution, securing a safe real-estate mortgage to procure a house and property, and buying fire and life insurance.

The sociological department moved to put these principles and procedures into practice among its workers. Its key strike force lay in a battalion of investigators who carried the department's message to the homes and hearths of Ford workers. Investigators visited an employee's home in cases of persistent absenteeism, for example, to ascertain whether domestic difficulties such as illness, debt, or a strained marriage lay behind the problem. But mainly they arrived, forms and questionnaires in hand, to survey an employee's habits—whether he dependably brought home his salary, consumed alcohol and gambled, or physically mistreated his wife and children—and to inquire about household living arrangements, the care of children, and family spending and savings habits.

Ford investigators were also to make workers aware of the social services available through the company. For example, the company maintained a bank for employee use. First established in the fall of 1913, the Employees' Savings and Loan Association, administered by Lee and Frank L. Klingensmith, became a fundamental repository for workers' funds and a lending institution after the Five-Dollar Day announcement in January 1914.

Teaching the men responsible values so that their new abundance would go to their families rather than to saloonkeepers, prostitutes, or bookies, Ford believed, would ensure the benefits of the company's wage experiment. During their planning sessions, Lee once asked Ford how far he would go to establish rules for conduct among his workers. Ford's reply revealed his moral passion: “Well, John, if you ever get track of the devil, you run and catch up to him, and you try to reform him.”

In an appearance before the Congressional Commission on Industrial Relations in January 1915, a little over a year after the launching of the sociological department, Henry Ford provided an overview of this new agency. “The whole effort of this corps is to point men to life and make them discontented with a mere living,” he concluded. “The object was simply to better the financial and moral status of the men.”

The first question established what you desire to accomplish or arrive at. Your answers are often found in the organisation’s vision. Your inner voice, gut feeling, the problem you are facing, re-search findings, and advisors can also help to answer the first question. Prominent scholars (e.g., Ansoff, 1957, 1965; Porter, 1980) in business developed critical theoretical frameworks, such as Por-ter’s Generic Strategy and Ansoff Matrix, to guide and help you understand what you want to do. However, whatever the source and tools you apply, this question needs a lot of thinking. If you fail to answer the first question correctly, even the best answers for the rest of the questions become futile and irrelevant.

The second question introduces a sense of practicality and pragmatism. It would be best to look at the possibilities based on the resources your organisation possesses or would obtain. It makes no sense, for example, to devise a strategy of employing hundreds of software engineers to build a massive software application if your organisation does not have the money to pay them. You can only seize a particular opportunity if you have the resources to take it.

Therefore, you must assess yourself, your organisation, current or possible obstacles, possibilities, and any other necessary factors before developing a strategy. Authors Gerald Michaelson and Steven Michaelson (2010, pp. 4-5) addressed five factors worth considering: the spirit of mission, outside forces, marketplace, leadership, and guiding principles. Prominent scholars (e.g., Porter, 1980) in business conceptualised critical tools for analysis, such as SWOT Analysis and Porter’s Five Forces of Competition, to help with research and analysis.

The third question focuses on which strategic moves are needed to reach your destination. Here, planning is valuable because it deals with the preparation, choice, and allocation of decisions and resources and how they are implemented and monitored. Planning is the art of deciding what should happen before it happens. As you may notice, you are finally dealing with possible actions that you can take. But there is a reason this question is ranked third: think and evaluate before you plan, so do not skip the previous two to go directly to this question.

The fourth question deals with the timing of actions and reactions. The right time, as Chapter 30: The Art of Timing explains, is significant in making a strategy effective. Sometimes, you could have ac-quired all the necessary resources and be fully prepared, but you still need to accomplish your goal because you have either been too early or too late. Time can explain why two strategists with the same resources, obstacles, and an almost identical strategy yield different or opposite results. Pa-tience, self-control, and emotional stability are needed to address this fourth question: When should you act or react to the situation? Agitation and fear, either coming from within or because some-one is manipulating you into them, are also reasons that make strategies ineffective – you may cre-ate a bad timing yourself.

Remember that even after answering all these four essential questions, you still have no guarantee that you will achieve the desired results because life is not a linear process. Obstacles and acci-dents arise even with an effective strategy. For example, the COVID-19 pandemic wreaked havoc on several start-ups planning to expand their business with a fantastic strategy. Nobody saw it com-ing. However, by answering four essential questions related to your objectives, you can increase your chances of success and reduce the odds against you.

This is the beauty of strategy - it allows you to turn unfavourable circumstances to your advantage. Indeed, while some start-ups were defunct due to COVID-19, others triumphed because they changed their strategy to leverage the situation. They had a mindset that any problem is an oppor-tunity in disguise. Therefore, as much as life is not linear, strategy prevails over these unforeseen circumstances if you strategise correctly. Having an effective strategy far outweighs having the odds against you.