The informal culture system is missing. The company has not had enough time to establish heroes or role models. The article is not clear as to whether or not there were major changes to existing positions within the company or if the company had established any rituals that encourage employees to live the culture.
The new culture seems to be in alignment. Bijur not only hired more diverse staff in high level positions, “he also established formal mentoring and leadership development programs to ensure that the company was preparing minorities for leadership positions” (Nelson & Trevino, 2004, p. 268). Nelson and Trevino (2004) report that diversity goals were established and tied into employees’ career development and incentive plans. Finally, Bijur also created “multiple methods” for filing employee complaints (Nelson & Trevion, 2004, p. 268).
Texaco’s management has taken many steps in the right direction: “You’re not going to change the way people think, but you can change the way they behave” (Nelson & Trevino, 2004, p. 269). Trying to change the behavior of thousands of employees is a difficult task to manage. One item Texaco could do that they have not is to offer employees an early retirement package in order to alleviate the organization of the “old blood” and enable it to hire new employees who genuinely embrace the newly established values of the company.
3. How long might such a culture change take?
A total reformation of a culture can take years to accomplish. Employees may resist the change due to being successful doing things the old way. Change is also difficult for some to cope with. Employees may believe the company is trying to change their personal ethics rather than their organizational values. The employees may then be faced with conflicting value systems that they may not know how to address. A CEO is much like a head football coach. Both may inherit or create a bad team. Each must determine the root cause of the problem and then decide how they will implement a better game plan. Chances are both will identify weak links on their team, and then begin to slowly replace them by drafting and developing younger talent who embraces the team’s strategy. It may take a few seasons, but eventually both will have players that believe in the system and live the culture. Doing so will place both in a better position to succeed.
DETERMINE FACTS
Within the case study of the Texaco Lawsuit, there were several key problems and issues. If one were to place themselves in the position of a female minority, employed at Texaco, the work dilemmas within this organization could be easier to isolate. Primarily, two major problems identified were discrimination and racism. Unfair labor practices, harassment, and unethical leadership behavior were of root problems. As symptoms of these problems, the organizational culture felt dishonesty, loss of integrity, mistrust, and cynicism. Unresolved issues of racism and bias behavior by company leaders lead them to behave in unlawful ways. There was no moral consideration when such meetings were held and video taped by the company’s executives, discussing the disposing of incriminating documents and using racial epithets. These were unlawful acts as they were contemplating an illegal act to hide evidence. According to ethical theories, a rights-based theory is an absolute law or an “outright prohibition” theory. (Langley Times. Langley, B. C., 2005, p. 1) No one is allowed to break such laws that are the individual’s rights. The unethical behavior demonstrated by these key players, the executives and leaders of Texaco literally broke the “Rights Theory”. In this company, an organizational culture could not be built with integrity if the decision making process used by Texaco leaders lead to unethical behavior. “Important decisions should be subjected to a discussion of ethical concern, especially potential impacts on stakeholders.”(Trevino & Nelson, 2004, p. 248)
If leaders take on a standard of behavior that sounds like this is “the way we do things around here”, then the organizational culture is just kept alive by informal norms. The culture within the organization forms an ethical culture that grows “out of alignment”. (Trevino & Nelson, 2004) People are more likely to believe the messages carried by the informal systems, such as, what is heard “through the grapevine”. (Trevino & Nelson). This becomes an informal norm. “Organizational identity is the cognitive process through which members align their individual and social identities with the organizational identity.” (Verbos, Gerard, Forshey, Harding, & Miller, 2007, p. 21) A company that is serious about it their ethics, develops an ethical culture that will help the employees in their actions and decisions through a code of ethics. This promotes an organizational identity. All employees, including minorities of this working group, had the right to work in an environment that was free of bias. Obviously, this company had not formulated a code of ethics and if there was, leaders in the company had not followed any ethical code and ultimately broke the law.
The roles of key players, the leaders of the Texaco Company, were the top influence of this company to create a working culture that sustains values and business ethics. “A positive ethical organization answers the question “who are we, ethically?” through the organizational acts and decisions consistent with the moral values expressed by its leaders and reinforced through its organizational culture and processes.” (Verbos, Gerard, Forshey, Harding, & Miller, 2007, p. 20- 21)
ANALYZE AND EVALUATE
The Texaco Corporation in 1999 came under fire for discrimination directed at minorities. Though the discrimination had been rampant for years and had infected most levels of employment throughout the corporation, the CEO took an ethical approach that forever changed the Texaco Corporation. Bijur, the CEO took a duty based ethical stance to resolve the critical situation. With the company’s revenues plummeting, Texaco introduced a drastic cultural change. As with all effective ethical change, Texaco acknowledged the problem both to its employees and community stakeholders. Senior management took a strong and affirmative stance. Bijur, “made it clear he would simply not tolerate disrespect and that those who didn’t go along with the cultural change would be dismissed” (Trevino & Nelson, 2004). Leadership was strong and decisive and clearly established diversity goals and timetables to meet the demands of the organization’s cultural change. The senior team also allowed an independent task force to monitor the corporation’s progress. The commitment by senior management to the cultural change was evident by the initiatives that were undertaken throughout the corporation.
The Texaco Corporation provided a transparent and duty based ethical change to all involved. Their approach provided a solid foundation, on which to build their new corporation mind set. The organization acknowledged their cultural deficit, provided opportunities for change and developed an alignment of the change with the strategic plan of the organization. The Texaco Corporation continues to move forward to provide a workplace free of “discrimination, harassment or retaliation in its workplace and that equality and fairness for all employees are central to its mission as a highly competitive business enterprise”(Trevino & Nelson, 2004).
ALTERNATIVES
When a major problem such as discrimination occurs there are obviously alternatives that could have helped Texaco avoid this situation. The first alternative for Texaco could have been to evaluate the national averages for minorities in the workplace. By viewing these numbers, Texaco would have been able to compare their statistics with the national averages and made the necessary changes.
Although it seems difficult to imagine, Texaco may have been blind to the discrimination and the way their employees were being treated. An alternative that may have helped the management team realize that they were discriminating against minorities is by providing open lines of communication. By allowing employees to express themselves directly to their manager, some of these problems may have been resolved at a lower level. Annual reviews for employees would be a good time for the employee to also speak up to management about any concerns about business, work flow, pay or discrimination. Any means of communication that Texaco could have provided to their employees could have helped save face in this situation.
A third alternative for Texaco could have been providing diversity programs encouraging minorities to promote and move into managerial positions. By having such programs Texaco could have proved to their staff as well as the public that they encourage minorities to continue to push forward in promoting and excelling as a Texaco employee. Taking a peak at what the competition does to encourage minorities to promote and train in other areas could have played a major role in avoiding the discrimination suit. It never hurts to look at what other businesses do to solve problems.
Another alternative for Texaco could have been to bring in an outside firm to evaluate the workplace diversity and to provide them with input on how to solve their problems. By doing so, Texaco could have been told their problems and fixed them before it imploded to the major discrimination case. There were many alternative routes for Texaco but there was a lack of problem solvers. It is important to be proactive rather than reactive. A proactive approach can not only save the complexion of an organization but also increase productivity, interest and overall results. It is important for Texaco to understand their alternatives but what is more important is for them to listen to the recommendations on how to improve and solve their problems.
RECOMMENDATION
The Texaco problem as identified earlier in the paper was within all levels of management and because of this, a reactive approach was taken. As several of these recommendation where eventually implemented by the Texaco corporation. Learning team C recommends that the following initiatives should have been taken immediately. A letter of apology to all employees from the head of the Texaco Corporation for intolerable actions of managers as well a guarantee that there will be a comprehensive plan of correction forth coming. This type of action will set the stage for the upcoming steps and shows leadership by accepting responsibility for the past problems.
Several of these recommendations for a plan of correction include a zero tolerance policy in regards to inappropriate personal behavior, conduct and or any actions deemed offensive. This policy should be in effect immediately as with most unethical and demeaning behaviors and conduct, those responsible are aware that their comments and or behaviors are offensive and demeaning. If these managers are allowed to stay in place the corporation will continue to suffer the legal ramifications thus causing a stigmatism and or decline in the reputation of the company which in turn can cause a decrease in stock prices and company stature. The zero tolerance policy will allow the company to relieve its self of the “bad Apples” or employees unwilling to change. As identified by the case study the continued employment of these types of employees can be costly discrimination and harassment legal awards of hundreds of millions of dollars. (Trevino and Nelson 2004)
Mandatory diversity training, this diversity training will bring education, meaning and insight the differences of the employees and it will also identify the accomplishments and contributions to the company by all employees regardless of ethnic, cultural or racial backgrounds.
Institute a minority hiring initiative at a minimum it should be representative of the minority percentages within the national demographics. The number of whites nationally between the 1990 and 2000 was 75 to 71 % the number of blacks in this same time frame was 12 %to 13% , Asians 3 to 4 % and Hispanics 9 to 11% (U.S. Census Bureau, 2007) . This initiative is at top to bottom approach and should include both hiring and promotions; this would mean that Texaco’s diversity management demographic goal should break down as follows 72% white, 12.5% black, 3.5% Asian, 10% Hispanic and 2% other. This would be an evolving process as the countries demographics change and would mean that the corporation would have to have an aggressive recruitment of minorities to fill these positions if unable to fill them from within. A diversity mentoring program should be initiated this will allow for the corporation to identify the up and coming managers. The is a program where the mentor and mentored are of different backgrounds. This type of program is in place in a leading retail corporation according to a personal conversation with a corporate regional director. The program has mandates and is included in his or her performance evaluation. “The manager” which includes all levels of management is required to have three mentors that are different from them. For example, a female manager should be mentoring a male or a minority member so as to allow the diversity to be recognized in both directions. An African American male manager should be mentoring someone different than themselves for example, a female or an Asian, Hispanic or Caucasian. These recommendations will be not be seen as quick fix to fulfill the requirements of some legal actions but will serve as an example of corporations recognizing a problem and ensuring that the right course of action, not the easy course of action is taken. Lastly a third party review system for hiring and promotions to ensure that the best qualified candidate is selected this type of hiring and promotional oversight is currently in operation in the retail corporation mentioned earlier. According to the regional director it helps to eliminate the appearance of favoritism and or the “good old boy” system of hiring, decreases the animosity and allows for the minority member to feel that he or she deserved their promotion rather than receiving it based on a quota or for other than merit reasons.
CONCLUSION Renee Salgado
References
Trevino, Linda K (2004). Managing Business Ethics: Straight Talk about How to Do It Right, Linda K. Trevino, Katherine A. Nelson, 2004 John Wiley and Sons, Inc. Retrieved on October 14, 2007.
Langley Times. Langley, B. C. (2005, September 25, 2005). No more laws needed. Retrieved October 15, 2007, from =
Verbos, A. K., Gerard, J. A., Forshey, P. R., Harding, C. S., & Miller, J. S. (2007). The Positive Ethical Organization: Enacting a Living Code of Ethics and Ethical Organizational Identity. Journal of Business Ethics, 76: 17- 33. Retrieved from, DOI 10.1007/s10551-006-9275-2