Virtuous and Vicious Cycles

July 19, 2019

Visionary founders create companies endowed with norms and values that contribute for the construction of strong organizational cultures. The first success normally happens out of a rigorous alignment around the intentions and the objectives of the business.

The founder’s proximity, the affinity with his values and ideals, creates a differentiated level of motivation in the people who enter the company, be invited to participate of the enterprise, feel themselves valued by taken part of the decisions and the collective construction in course.

Of course, it grows a deep feeling of commitment and loyalty. The first results and successes are shared, generating pride to belong even more and producing high levels of delivery, generating new successes and more results.

Them, there is a first virtuous cycle that leads to the organizational growth.

The company develops, more people are hired, the structure increases, layers are added. The processes become more complex, with added levels of approval, the bureaucracy self-installs quietly.

The dispute for growth opportunity creates incited internal competition; individuals start to invest energy and attention to the proper career instead of focus on business and customers.

"Specialist" managers are promoted to leadership positions, without necessarily being prepared for that. The success of the business is confused with personal success. The arrogance starts stealthily impregnating. Blinkers are the new look.

The environment converts itself into a political association, a dispute of egos.

The priority passes to be the internal focus and the distance from the external reality, separates the leadership from the changes of the business context, at this stage it has already changed deeply and followed in wild and agile change.

This disconnection leads to the beginning of the deterioration of the enterprise.

But this is not perceived by many, or if perceived, it is minimized as if it were transitory. Repeatedly, brilliant executives do not see the future of the decay.

Others until perceive its dimension and gravity, but for being close to the retirement, or of a career change in another country, they opt to leave the problem to the next generation or the next executive.

This timing can be fatal or, at least, it will increase even more the challenge of the growth retaken.

Only a visionary and courageous leadership will raise the question, place the crisis in the guideline, evoke the urgency sense and call to action.

A new strategic positioning will become urgent to recoup the growth level and for this, a transformation in the form of being and acting inside the company will become imperative.

The form of being and acting of an organization, thus, its culture, will have to be remodelled to be a facilitator of the new strategy, the new production of results, the reinsertion of customers and other stakeholders in the center of attentions.

A new virtuous cycle will be initiated from the strategical revision of the competitiveness and of the change in the operation form, adapting strategically the organizational culture organization to the external context.

To this new cycle, a more virtuous time, we call organizational transformation journey.


Raïssa Lumack, is a Senior Partner of BMI, acting in projects of cultural transformation. She graduated from Pontifícia Universidade Católica of Rio De Janeiro in History, with MBA in Company's Management at Instituto de Empresas de Madrid, Spain. She attended a STC course at Dom Cabral Foundation in partnership with Kellogg Management School - USA, among others. Previously, she was responsible for Human Resources function in several companies, among them, Coca-Cola, Embratel, Xerox do Brazil, beyond having leaded the Human Resources Consulting Practices at KPMG, in Rio De Janeiro.