Even Macy’s Does It

We have long been proponents of looking for innovative ways to improve safety management training for nuclear professionals.  We’ve taken the burden to develop a prototype management simulator, NuclearSafetySim, and made it available to our readers to experience for themselves (see our July 30, 2013 post).  In the past we have also noted other industries and organizations that have embraced simulation as an effective management training tool.

An August article in the Wall Street Journal* cites several examples of new approaches to manager training.  Most notable in our view is Macy’s use of simulations to have managers gain decision making experience.  As the article states:

“The simulation programs aim to teach managers how their daily decisions can affect the business as a whole.”

We won’t revisit all the arguments that we’ve made for taking a systems view of safety management, focusing on decisions as the essence of safety culture and using simulation to allow personnel to actualize safety values and priorities.  All of these could only enrich, challenge and stimulate training activities. 

A Clockwork Magenta
 
On the other hand what is the value of training approaches that reiterate INPO slide shows, regulatory policy statements and good practices in seemingly endless iterations?  Brings to mind the character Alex, the incorrigible sociopath in A Clockwork Orange with an unusual passion for classical music.**  He is the subject of “reclamation treatment”, head clamped in a brace and eyes pinned wide open, forced to watch repetitive screenings of anti-social behavior to the music of Beethoven’s Fifth.  We are led to believe this results in a “cure” but does it and at what cost?

Nuclear managers may not be treated exactly like Alex but there are some similarities.  After plant problems occur and are diagnosed, managers are also declared “cured” after each forced feeding of traits, values, and the need for increased procedure adherence and oversight.  Results still not satisfactory?  Repeat.


*  R. Feintzeig, "Building Middle-Manager Morale," Wall Street Journal (Aug. 7, 2013).  Retrieved Sept. 24, 2013.

**  M. Amis, "The Shock of the New:‘A Clockwork Orange’ at 50,"  New York Times Sunday Book Review (Aug. 31, 2013).  Retrieved Sept. 24, 2013.

Bad Eggs?

We’ve often thought that intentional or willful violations of safety/regulatory requirements could provide a useful window into the dynamics of safety culture.  Now the NRC has just issued an Information Notice* listing recent instances of willful violations.  The Notice is titled “Willful Misconduct/Record Falsification and Nuclear Safety Culture” and reports on seven recent instances of such conduct.  From the title and throughout the notice the NRC asserts a link between willful violations and nuclear safety culture.  To wit it states, “An effective safety-culture is essential to nuclear safety at all phases of design, construction and operation and can help prevent willful misconduct by ensuring expectations and consequences are clearly stated and understood.” (p. 5)  The NRC adds, “The above willful misconduct issues and discussion highlights the need... to establish and implement an effective nuclear safety-culture.  This includes training, adequate oversight, and frequent communications especially for workers new to the nuclear industry.” (p. 6)

What we see here is consistent with the NRC’s pro forma approach to organizational safety performance issues.  The problem is culture; the answer is more training, more clarity of expectations, more oversight.**  Oh, and disciplinary actions for the errant individuals.  

Are we to take from this that the individuals involved in these situations are just “bad eggs”?  And the answer is some punishment and re-education?  Is this even consistent with the nature of willful violations and does the sheer number of recent experiences raise more fundamental questions, the most basic of which is “Why?”

Let’s start with what is different about willful violations.  Willful violations are deliberate, intentional and knowing.  In other words the individual knows his/her actions are against established policies or procedures.  This is not a case of carelessness or lack of knowledge of what is expected.  Thus it is hard to understand what would be achieved by more training and reinforcement of expectations.  The prescription for more oversight is also puzzling.  It appears to assume that violations will continue unless there is strict monitoring of behaviors.  Interestingly it is reliance on more oversight by managers who apparently weren’t providing the necessary oversight in the first place.

So on the one hand the corrective actions identified in the these events do not appear well suited to the nature of a willful violation.  Perhaps more importantly this treatment of the problem obscures deeper analysis of why such violations are occurring in the first place.  Why are personnel deciding to intentionally do something wrong?  Often willful acts have their basis in personal gain or covering up some other misdeed.  Nothing in the seven instances in the Notice even hint at this type of motivation.  Could it be an intent to do harm to the organization due to some other personal issue - a problem with a supervisor, being passed by for a promotion, etc?  Hmmm, I guess it’s possible but again there does not appear to be any hint of this in the available documentation. Or could it be that the individuals were responding to some actual or perceived pressure to get something done - more quickly, at less cost, or to avoid raising an issue that itself would cost time or money?  Again there was no exploration of motive for these violations in the NRC’s or licensee’s investigations.***

The apparent failure to fully investigate the motive for these violations is unfortunate as it leaves other critical factors unexplored and untreated.  Goal pressures almost always have their origin higher up in the organization.  Defaulting to reinforcing the culture side of the equation may not be effective due to the inherent contradiction in signals from upper management. 

In a prior post we suggested that safety culture be thought of as a “pressure boundary”, specifically “the willingness and ability of an organization to resist undue pressure on safety from competing business priorities”.   When resistance breaks down it can lead to shading of safety assessments, a decided lack of rigor in pursuing causes and extent of condition - or it can even lead to willful violations.  Relieving business pressure may be the far more effective antidote.


*  NRC Information Notice 2013-15: Willful Misconduct/Record Falsification and Nuclear Safety Culture (Aug. 23, 2013).  ADAMS ML13142A437.

**  In two instances modest civil penalties were also assessed.

***  We would remind our readers of our post dated April 2, 2012 regarding the guilty plea of one of the Massey coal mine supervisors to intentional violations of the law.  The stated reason: following the law would decrease coal production.

Normal Accidents by Charles Perrow

This book*, originally published in 1984, is a regular reference for authors writing about complex socio-technical systems.**  Perrow's model for classifying such systems is intuitively appealing; it appears to reflect the reality of complexity without forcing the reader to digest a deliberately abstruse academic construct.  We will briefly describe the model then spend most of our space discussing our problems with Perrow's inferences and assertions, focusing on nuclear power.  

The Model

The model is a 2x2 matrix with axes of coupling and interactions.  Not surprisingly, it is called the Interaction/Coupling (IC) chart.

“Coupling” refers to the amount of slack, buffer or give between two items in a system.  Loosely coupled systems can accommodate shocks, failures and pressures without destabilizing.  Tightly coupled systems have a higher risk of disastrous failure because their processes are more time-dependent, with invariant sequences and a single way of achieving the production goal, and have little slack. (pp. 89-94)

“Interactions” may be linear or complex.  Linear interactions are between a system component and one or more other components that immediately precede or follow it in the production sequence.  These interactions are familiar and, if something unplanned occurs, the results are easily visible.  Complex interactions are between a system component and one or more other components outside the normal production sequence.  If unfamiliar, unplanned or unexpected sequences occur, the results may not be visible or immediately comprehensible. (pp. 77-78)

Nuclear plants have the tightest coupling and most complex interactions of the two dozen systems Perrow shows on the I/C chart, a population that included chemical plants, space missions and nuclear weapons accidents. (p. 97)

Perrow on Nuclear Power

Let's get one thing out of the way immediately: Normal Accidents is an anti-nuke screed.  Perrow started the book in 1979 and it was published in 1984.  He was motivated to write the book by the TMI accident and it obviously colored his forecast for the industry.  He reviews the TMI accident in detail, then describes nuclear industry characteristics and incidents at other plants, all of which paint an unfavorable portrait of the industry.  He concludes: “We have not had more serious accidents of the scope of Three Mile Island simply because we have not given them enough time to appear.” (p. 60, emphasis added)  While he is concerned with design, construction and operating problems, his primary fear is “the potential for unexpected interactions of small failures in that system that makes it prone to the system accident.” (p. 61)   

Why has his prediction of such serious accidents not come to pass, at least in the U.S.?

Our Perspective on Normal Accidents

We have several issues with this book and the author's “analysis.”

Nuclear is not as complex as Perrow asserts 

There is no question that the U.S. nuclear industry grew quickly, with upsized plants and utilities specifying custom design combinations (in other words, limited standardization).  The utilities were focused on meeting significant load growth forecasts and saw nuclear baseload capacity as an efficient way to produce electric power.  However, actually operating a large nuclear plant was probably more complex than the utilities realized.  But not any more.  Learning curve effects, more detailed procedures and improved analytic methods are a few of the factors that led to a greater knowledge basis for plant decision making.  The serious operational issues at the “problem plants” (circa 1997) forced operators to confront the reality that identifying and permanently resolving plant problems was necessary for survival.  This era also saw the beginning of industry consolidation, with major operators applying best methods throughout their fleets.  All of these changes have led to our view that nuclear plants are certainly complicated but no longer complex and haven't been for some time.    

This is a good place to point out that Perrow's designation of nuclear plants as the most complex and tightest coupled systems he evaluated has no basis in any real science.  In his own words, “The placement of systems [on the interaction/coupling chart] is based entirely on subjective judgments on my part; at present there is no reliable way to measure these two variables, interaction and coupling.” (p. 96)

System failures with incomprehensible consequences are not the primary problem in the nuclear industry

The 1986 Chernobyl disaster was arguably a system failure: poor plant design, personnel non-compliance with rules and a deficient safety culture.  It was a serious accident but not a catastrophe.*** 

But other significant industry events have not arisen from interactions deep within the system; they have come from negligence, hubris, incompetence or selective ignorance.  For example, Fukushima was overwhelmed by a tsunami that was known to be possible but was ignored by the owners.  At Davis-Besse, personnel ignored increasingly stronger signals of a nascent problem but managers argued that in-depth investigation could wait until the next outage (production trumps safety) and the NRC agreed (with no solid justification).  

Important system dynamics are ignored 

Perrow has some recognition of what a system is and how threats can arise within it: “. . . it is the way the parts fit together, interact, that is important.  The dangerous accidents lie in the system, not in the components.” (p. 351)  However, he is/was focused on interactions and couplings as they currently exist.  But a socio-technical system is constantly changing (evolving, learning) in response to internal and external stimuli.  Internal stimuli include management decisions and the reactions to performance feedback signals; external stimuli include environmental demands, constraints, threats and opportunities.  Complacency and normalization of deviance can seep in but systems can also bolster their defenses and become more robust and resilient.****  It would be a stretch to say that nuclear power has always learned from its mistakes (especially if they occur at someone else's plant) but steps have been taken to make operations less complex. 

My own bias is Perrow doesn't really appreciate the technical side of a socio-technical system.  He recounts incidents in great detail, but not at great depth and is often recounting the work of others.  Although he claims the book is about technology (the socio side, aka culture, is never mentioned), the fact remains that he is not an engineer or physicist; he is a sociologist.

Conclusion

Notwithstanding all my carping, this is a significant book.  It is highly readable.  Perrow's discussion of accidents, incidents and issues in various contexts, including petrochemical plants, air transport, marine shipping and space exploration, is fascinating reading.  His interaction/coupling chart is a useful mental model to help grasp relative system complexity although one must be careful about over-inferring from such a simple representation.

There are some useful suggestions, e.g., establishing an anonymous reporting system, similar to the one used in the air transport industry, for nuclear near-misses. (p. 169)  There is a good discussion of decentralization vs centralization in nuclear plant organizations. (pp. 334-5)  But he says that neither is best all the time, which he considers a contradiction.  The possibility of contingency management, i.e., using a decentralized approach for normal times and tightening up during challenging conditions, is regarded as infeasible.

Ultimately, he includes nuclear power with “systems that are hopeless and should be abandoned because the inevitable risks outweigh any reasonable benefits . . .” (p. 304)*****  As further support for this conclusion, he reviews three different ways of evaluating the world: absolute, bounded and social rationality.  Absolute rationality is the province of experts; bounded rationality recognizes resource and cognitive limitations in the search for solutions.  But Perrow favors social rationality (which we might unkindly call crowdsourced opinions) because it is the most democratic and, not coincidentally, he can cite a study that shows an industry's “dread risk” is highly correlated with its position on the I/C chart. (p. 326)  In other words, if lots of people are fearful of nuclear power, no matter how unreasonable those fears are, that is further evidence to shut it down.

The 1999 edition of Normal Accidents has an Afterword that updates the original version.  Perrow continues to condemn nuclear power but without much new data.  Much of his disapprobation is directed at the petrochemical industry.  He highlights writers who have advanced his ideas and also presents his (dis)agreements with high reliability theory and Vaughn's interpretation of the Challenger accident.

You don't need this book in your library but you do need to be aware that it is a foundation stone for the work of many other authors.

 
*  C. Perrow, Normal Accidents: Living with High-Risk Technologies (Princeton Univ. Press, Princeton, NJ: 1999).

**  For example, see Erik Hollnagel, The ETTO Principle: Efficiency-Thoroughness Trade-Off (reviewed here); Woods, Dekker et al, Behind Human Error (reviewed here); and Weick and Sutcliffe, Managing the Unexpected: Resilient Performance in an Age of Uncertainty (reviewed here).  It's ironic that Perrow set out to write a readable book without references to the “sacred texts” (p. 11) but it appears Normal Accidents has become one.

***  Perrow's criteria for catastrophe appear to be: “kill many people, irradiate others, and poison some acres of land.” (p. 348)  While any death is a tragedy, reputable Chernobyl studies report fewer than 100 deaths from radiation and project 4,000 radiation-induced cancers in a population of 600,000 people who were exposed.  The same population is expected to suffer 100,000 cancer deaths from all other causes.  Approximately 40,000 square miles of land was significantly contaminated.  Data from Chernobyl Forum, "Chernobyl's Legacy: Health, Environmental and Socio-Economic Impacts" 2nd rev. ed.  Retrieved Aug. 27, 2013.  Wikipedia, “Chernobyl disaster.”  Retrieved Aug. 27, 2013.

In his 1999 Afterword to Normal Accidents, Perrow mentions Chernobyl in passing and his comments suggest he does not consider it a catastrophe but could have been had the wind blown the radioactive materials over the city of Kiev.

****  A truly complex system can drift into failure (Dekker) or experience incidents from performance excursions outside the safety boundaries (Hollnagel).

*****  It's not just nuclear power, Perrow also supports unilateral nuclear disarmament. (p. 347)

No Innocent Bystanders

The stake that sticks up gets hammered down.

We recently saw an article* about organizational bystander behavior.  Organizational bystanders are people who sense or believe that something is wrong—a risk is increasing or a hazard is becoming manifest—but they don't force their organization to confront the issue or they only halfheartedly pursue it.**  This is a significant problem in high-hazard activities; it seems that after a serious incident occurs, there is always someone, or even several someones, who knew the incident's causes existed but didn't say anything.  Why don't these people speak up?

The authors describe psychological and organizational factors that encourage bystander behavior.  Psychological factors are rooted in uncertainty, observing the failure of others to act and the expectation that expert or formal authorities will address the problem.  Fear is a big factor: fear of being wrong, fear of being chastised for thinking above one's position or outside one's field of authority, fear of being rejected by the work group even if one's concerns are ultimately shown to be correct or fear of being considered disloyal; in brief, fear of the dominant culture. 

Organizational factors include the processes and constraints the organization uses to filter information and make decisions.  Such factors include limiting acceptable information to that which comports with the organization's basic assumptions, and rigid hierarchical and role structures—all components of the organization's culture.  Other organizational factors, e.g., resource constraints and external forces, apply pressure on the culture.  In one type of worst case, “imposing nonnegotiable performance objectives combined with severe sanctions for failure encourages the violation of rules, reporting distortions, and dangerous, sometimes illegal short-cuts.” (p. 52)  Remember Massey Energy and the Upper Big Branch mine disaster?

The authors provide a list of possible actions to mitigate the likelihood of bystander behavior.  Below we recast some of these actions as desirable organizational (or cultural) attributes.

• Mechanisms exist for encouraging and expressing dissenting points of view;
• Management systems balance the need for short-term performance with the need for productive inquiry into potential threats;
• Approaches exist to follow-up on near-misses and other “weak signals” [an important attribute of high reliability organizations]:
• Disastrous but low probability events are identified and contingency plans prepared;
• Performance reviews, self-criticism, and a focus on learning at all levels are required.

Even in such a better world, “bystander behavior is not something that can be 'fixed' once and for all, as it is a natural outgrowth of the interplay of human psychology and organizational forces. The best we can hope for is to manage it well, and, by so doing, help to prevent catastrophic outcomes.” (p.53) 

Our Perspective

This paper presents a useful discussion of the interface between the individual and the organization under problematic conditions, viz., when the individual sees something that may be at odds with the prevailing world view.  It's important to realize that even if the organizational factors are under control, many people will still be reluctant to rock the boat, lo the risk they see is to the boat itself.   

The authors correctly emphasize the important role of leadership in developing the desirable organizational attributes, however, as we have argued elsewhere, leadership can influence, but not unilaterally specify, organizational culture. 

We would like to see more discussion of systemic processes.  For example, the impact of possible negative feedback on the individual is described but positive feedback, such as through the compensation, recognition and reward systems, is not discussed.  Organizational learning (adaptation) is mentioned but not well developed.

The article mentions the importance of independent watchdogs.  We note that in the nuclear industry, the regulator plays an important role in encouraging bystanders to get involved and protecting them if they do.

The article concludes with a section on the desirable contributions of the human resources (HR) department.  It is, quite frankly, unrealistic (it overstates the role and authority of HR in nuclear organizations I have seen) but was probably necessary to get the article published in an HR journal. 


*  M.S. Gerstein and R.B. Shaw, “Organizational Bystanders,” People and Strategy 31, no. 1 (2008), pp. 47-54.  Thanks to Madalina Tronea for publicizing this article on the LinkedIn Nuclear Safety group.  Dr. Tronea is the group's founder/manager.

**  This is a bit different from the classic bystander effect which refers to a situation where the more people present when help is needed, the less likely any one of them is to provide the help, each one expecting others to provide assistance. 

Nuclear Industry Scandal in South Korea

As you know, over the past year trouble has been brewing in the South Korean nuclear industry.  A recent New York Times article* provides a good current status report.  The most visible problem is the falsification of test documents for nuclear plant parts.  Executives have been fired, employees of both a testing company and the state-owned entity that inspects parts and validates their safety certificates have been indicted.

It should be no surprise that the underlying causes are rooted in the industry structure and culture.  South Korea has only one nuclear utility, state-owned Korea Electric Power Corporation (Kepco).  Kepco retirees go to work for parts suppliers or invest in them.  Cultural attributes include valuing personal ties over regulations, and school and hometown connections.  Bribery is used as a lubricating agent.

As a consequence,  “In the past 30 years, our nuclear energy industry has become an increasingly closed community that emphasized its specialty in dealing with nuclear materials and yet allowed little oversight and intervention,” the government’s Ministry of Trade, Industry and Energy said in a recent report to lawmakers. “It spawned a litany of corruption, an opaque system and a business practice replete with complacency.”

Couldn't happen here, right?  I hope not, but the U.S. nuclear industry, while not as closed a system as its Korean counterpart, is hardly an open community.  The “unique and special” mantra promotes insular thinking and encourages insiders to view outsiders with suspicion.  The secret practices of the industry's self-regulator do not inspire public confidence.  A familiar cast of NEI/INPO participants at NRC stakeholder meetings fuels concern over the degree to which the NRC has been captured by industry.  Utility business decisions that ultimately killed plants (CR3, Kewaunee, San Onofre) appear to have been made in conference rooms isolated from any informed awareness of worst-case technical/commercial consequences.  Our industry has many positive attributes but some others ask us to stop and reflect.  

*  C. Sang-Hun, “Scandal in South Korea Over Nuclear Revelations,” New York Times (Aug. 3, 2013).  Retrieved Aug. 6, 2013.

Introducing NuclearSafetySim

We have referred to NuclearSafetySim and the use of simulation tools on a regular basis in this blog.  NuclearSafetySim is our initiative to develop a new approach to safety management training for nuclear professionals.  It utilizes a simulator to provide a realistic nuclear operations environment within which players are challenged by emergent issues - where they must make decisions balancing safety implications and other priorities - over a five year period.  Each player earns an overall score and is provided with analyses and data on his/her decision making and performance against goals.  It is clearly a different approach to safety culture training, one that attempts to operationalize the values and traits espoused by various industry bodies.  In that regard it is exactly what nuclear professionals must do on a day to day basis. 

At this time we are making NuclearSafetySim available to our readers through a web-based demo version.  To get started you need to access the NuclearSafetySim website.  Click on the Introduction tab at the top of the Home page.  Here you will find a link to a narrated slide show that provides important background on the approach used in the simulation.  It runs about 15 minutes.  Then click on the Simulation tab.  Here you will find another video which is a demo of NuclearSafetySim.  While this runs about 45 minutes (apologies) it does provide a comprehensive tutorial on the sim and how to interact with it.  We urge you to view it.  Finally...at the bottom of the Simulation page is a link to the NuclearSafetySim tool.  Clicking on the link brings you directly to the Home screen and you’re ready to play.

As you will see on the website and in the sim itself, there are reminders and links to facilitate providing feedback on NuclearSafetySim and/or requesting additional information.  This is important to us and we hope our readers will take the time to provide thoughtful input, including constructive criticism.  We welcome all comments. 

Leadership, Culture and Organizational Performance

As discussed in our July 18, 2013 post, INPO's position is that creating and maintaining a healthy safety culture (SC) is a primary leadership responsibility.*  That seems like a common sense belief but is it based on any social science?  What is the connection between leader behavior and culture?  And what is the connection between culture and organizational performance? 

To help us address these questions, we turn to a paper** by some Stanford and UC Berkeley academics.  They review the relevant literature and present their own research and findings.  This paper is not a great fit with nuclear power operations but some of the authors' observations and findings are useful.  One might think there would be ample materials on this important topic but “only a very few studies have actually explored the interrelationships among leadership, culture and performance.” (p. 33)

Leaders and Culture

Leaders can be described by different personality types.  Note this does not focus on specific behavior, e.g., how they make decisions, but the attributes of each personality type certainly imply the kinds of behavior that can reasonably be expected.  The authors contend “. . . the myriad of potential personality and value constructs can be reliably captured by five essential personality constructs, the so-called Big Five or the Five Factor Model . . .” (p. 6)  You have all been exposed to the Big 5, or a similar, taxonomy.  An individual may exhibit attributes from more than one type but can be ultimately be classified as primarily representative of one specific type.  The five types are listed below, with a few selected attributes for each.

• Agreeableness (Cooperative, Compromising, Compassionate, Trusting)
• Conscientiousness (Orderly, Reliable, Achievement oriented, Self-disciplined, Deliberate, Cautious)
• Extraversion (Gregarious, Assertive, Energy, Optimistic)
• Neuroticism (Negative affect, Anxious, Impulsive, Hostile, Insecure)
• Openness to Experience (Insightful, Challenge convention, Autonomous, Resourceful)

Leaders can affect culture and later we'll see that some personality types are associated with specific types of organizational culture.  “While not definitive, the evidence suggests that personality as manifested in values and behavior is associated with leadership at the CEO level and that these leader attributes may affect the culture of the organization, although the specific form of these relationships is not clear.” (p. 10)  “. . . senior leaders, because of their salience, responsibility, authority and presumed status, have a disproportionate impact on culture, . . .” (p. 11)

Culture and Organizational Performance

Let's begin with a conclusion: “One of the most important yet least understood questions is how organizational culture relates to organizational performance” (p. 11)

To support their research model, the authors describe a framework, similar to the Big 5 for personality, for summarizing organizational cultures.  The Organizational Culture Profile (OCP) features seven types of culture, listed below with a few selected attributes for each. 

• Adaptability (Willing to experiment, Taking initiative, Risk taking, Innovative)
• Collaborative (Team-oriented, Cooperative, Supportive, Low levels of conflict)
• Customer-oriented (Listening to customers, Being market driven)
• Detail-oriented (Being precise, Emphasizing quality, Being analytical)
• Integrity (High ethical standards, Being honest)
• Results-Oriented (High expectations for performance, Achievement oriented, Not easy going)
• Transparency (Putting the organization’s goals before the unit, Sharing information freely)

The linkage between culture and performance is fuzzy.  “While the strong intuition was that organizational culture should be directly linked to firm effectiveness, the empirical results are equivocal.” (p. 14)  “[T]he association of culture and performance is not straightforward and likely to be contingent on the firm’s strategy, the degree to which the culture promotes adaptability, and how widely shared and strongly felt the culture is.” (p. 17)  “Further compounding the issue is that the relationship between culture and firm performance has been shown to vary across industries.” (p. 11)  Finally, “although the [OCP] has the advantage of identifying a comprehensive set of cultural dimensions, there is no guarantee that any particular dimension will be relevant for a particular firm.” (p. 18)  I think it's fair to summarize the culture-performance literature by saying “It all depends.” 

Research Results

The authors gathered and analyzed data on a group of high-technology firms: CEO personalities based on the Big 5 types, cultural descriptions using the OCP, and performance data.  Firm performance was based on financial metrics, firm reputation (an intangible asset) and employee attitudes.*** (p. 23-24) 

“[T]he results reveal a number of significant relationships between CEO personality and firm culture, . . . CEOs who were more extraverted (gregarious, assertive, active) had cultures that were more results-oriented. . . . CEOs who were more conscientious (orderly, disciplined, achievement-oriented) had cultures that were more detail-oriented . . . CEOs who were higher on openness to experience (ready to challenge convention, imaginative, willing to try new activities) [were] more likely to have cultures that emphasized adaptability. (p. 26)

“Cultures that were rated as more adaptable, results-oriented and detail-oriented were seen more positively by their employees. Firms that emphasized adaptability and were more detail-oriented were also more admired by industry observers.” (p. 28)

In sum, the linkage between leadership and performance is far from clear.  But “consistent patterns of [CEO] behavior shape interpretations of what’s important [values] and how to behave. . . . Other research has shown that a CEO’s personality may affect choices of strategy and structure.” (p. 31)

Relevance to Nuclear Operations

As mentioned in the introduction, this paper is not a great fit with the nuclear industry.  The authors' research focuses on high technologically companies, there is nothing SC-specific and their financial performance metrics (more important to firms in highly competitive industries) are more robust than their non-financial measures.  Safety performance is not mentioned.

But their framework stimulates us to ask important questions.  For example, based on the research results, what type of CNO would you select for a plant with safety performance problems?  How about one facing significant economic challenges?  Or one where things are running smoothly?  Based on the OCP, what types of culture would be most supportive of a strong SC?  Would any types be inconsistent with a strong SC?  How would you categorize your organization's culture?  

The authors suggest that “Senior leaders may want to consider developing the behaviors that cultivate the most useful culture for their firm, even if these behaviors do not come naturally to them.” (p. 35)  Is that desirable or practical for your CNO?

The biggest challenge to obtaining generalizable results, which the authors recognize, is that so many driving factors are situation-specific, i.e., dependent on a firm's industry, competitive position and relative performance.  They also recognize a possible weakness in linear causality, i.e., the leadership → culture → performance logic may not be one-way.  In our systems view, we'd say there are likely feedback loops, two-way influence flows and additional relevant variables in the overall model of the organization.

The linear (Newtonian) viewpoint promoted by INPO suggests that culture is mostly (solely?) created by senior executives.  If only it were that easy.  Such a view “runs counter to the idea that culture is a social construct created by many individuals and their behavioral patterns.” (p. 10)  We believe culture, including SC, is an emergent organizational property created by the integration of top-down activities with organizational history, long-serving employees, and strongly held beliefs and values, including the organization's “real” priorities.  In other words, SC is a result of the functioning over time of the socio-technical system.  In our view, a CNO can heavily influence, but not unilaterally define, organizational culture including SC.


*  As another example of INPO's position, a recent presentation by an INPO staffer ends with an Ed Schein quote: “...the only thing of real importance that leaders do is to create and manage culture...”  The quote is from Schein's Organizational Culture and Leadership (San Francisco, CA: Jossey-Bass, 1985), p. 2.  The presentation was A. Daniels, “How to Continuously Improve Cultural Traits for the Management of Safety,” IAEA International Experts’ Meeting on Human and Organizational Factors in Nuclear Safety in the Light of the Accident at the Fukushima Daiichi Nuclear Power Plant, Vienna May 21-24, 2013.
 
**  C. O’Reilly, D. Caldwell, J. Chatman and B. Doerr, “The Promise and Problems of Organizational Culture: CEO Personality, Culture, and Firm Performance”  Working paper (2012).  Retrieved July 22, 2013.  To enhance readability, in-line citations have been removed from quotes.

***  The authors report “Several studies show that culture is associated with employee attitudes . . . ” (p. 14)