Seven Habits of Highly Dysfunctional Companies

Published on: 
Pharmaceutical Technology, Pharmaceutical Technology-04-02-2006, Volume 30, Issue 4

Senior management must be the champions of change in companies that are struggling financially or organizationally.

We've all had that moment when we've asked, "How can my company be making money?" It's amazing that many companies seem to survive and even thrive in spite of themselves. Even companies that have good financial results can have a culture that exacts a heavy toll on their employees. Companies that struggle financially or emotionally, in an organizational sense, have common elements or patterns of behavior.

David J. Lennard

"Yes" organizations. In these organizations, management only wants to hear "yes." Management tends to be very insecure and afraid that someone else may be smarter or have a better idea then they do. Being a team player here means that you agree with those in charge.

"Form over substance" organizations. These companies put five senior people in a room for a month to prepare a one-hour presentation for the vice-president. The last week before the presentation is spent arguing over PowerPoint background colors.


"I should have been an English teacher" organizations. Most document and report reviews focus on grammar, font size, and style and page-numbering formats. These points, though important, are very much secondary to discussions about content.

"I love huge teams" organizations. In these companies, huge teams are the key to accomplishing just about everything. These organizations feel that to make any decisions, you must have a team of 30 or more people and spend a year ensuring that everyone's opinion is heard, debated, and included in the final solution. We all know what these decisions look like.

"Don't turn your back" organizations. Organizational politics is a part of life in any company and is neither inherently good nor bad. In certain companies, though, every decision's first analysis centers on "What's in it for me?" and, if possible, "How can I stick it to you?"

"I used to be an engineer" organizations. In this kind of company, senior management not only wants to see the data, they want to see the raw numbers, too. There is no strategic direction or thinking. Everyone becomes as tactical as possible because fire fighting is much more fun. In the end, they use the highest-paid people to do the lowest level job.

"No one tells us anything" organizations. Communication is one of the biggest problems in any company. It is extremely difficult to find the right level and content of any communication. These organizations represent the opposite ends of the communications spectrum. In one extreme, they tell everyone everything. On the other hand, they never communicate. The end result is that no one understands what is important and valued in the company.

These problems can be overcome, and, like most things, it starts with recognizing the problem. It is very difficult to be honest about who we are (as a person or as a company), but it is absolutely necessary before any steps can be taken to remedy the situation. Many times, it takes an outside voice to identify and ultimately push to change these behaviors. It is extremely difficult to be objective about our own culture.

Addressing the problem is easy: stop doing what you are doing. Senior management must be the champions of change, which should be a leader's key role. Company cultures evolve to fit a competitive or environmental need. Problems arise when competitive or environmental changes occur, and the organizational norms do not change to meet the new requirements. Management must constantly look forward and challenge the organization to ensure that the culture evolves to meet today's requirements.

David J. Lennard is the president of Leadership Systems, Inc., 42 Park Road, Ottsville, PA 18942, tel. 215.262.3582, fax 610.847.2807,