Page 58 - MS Year in Review 2020

Prior articles have examined successful crisis leadership at American Express,

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Chrysler and Disney, and the unsuccessful crisis leadership at Sears and Kodak.

SPECIFIC FOCUS: DYSFUNCTIONAL CULTURAL

CHARACTERISTICS CREATING SUSCEPTIBILITY TO

A CRISIS

Based upon our research analysis, weaknesses in a company’s culture which can
create the preconditions for “susceptibility to a crisis.” These are cultural

characteristics or traits that leave an organization vulnerable to a crisis and, when
the company does experience a crisis these symptoms put the company at greater
risk. Specifically, we have identified the typical dysfunctional cultural characteristics

– shown in Exhibit A – that can cause or contribute to crises; or inhibit their
resolution.

Exhibit A

Dysfunctional Cultural Characteristics

 Cultural overconfidence or arrogance
 Inflexible corporate identity

 A culture of fiefdoms or silos
 Resistance to change
 Antipathy to anything “not made here”

 Extreme sense of “we are different”

30 Eric Flamholtz “CRISIS LEADERSHIP LESSONS: Iacocca Changes the Culture at
Chrysler,” Linkedin, July 1, 2020 and Eric Flamholtz “CRISIS LEADERSHIP LESSONS: Culture Change
at American Express, Linkedin, July 7, 2020; Eric Flamholtz, “Unsuccessful CRISIS LEADERSHIP
LESSONS: The Tragic Downfall of Sears, Linkedin, July 13, 2020; Eric Flamholtz “Michael Eisner’s
Successful Crisis Leadership at Disney,” Linkedin, July 21, 2020; Eric Flamholtz, “Crisis Leadership
lessons: The Downfall of Kodak,” Linkedin, July 30, 2020; Eric Flamholtz, “Is Your Organization
Susceptible to a Crisis”? Linkedin August. 11, 2020.

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