Business Failure 12: Toxic or Rotten Corporate Culture

This continues our series exploring reasons business fail so you can save your business

A lot of businesses fail because of a rotten corporate culture. Sometimes the culture’s rot stems from underhanded dealings with others. Rotten cultures can come from vindictive even intimidating owners. Some rotten cultures fester when owners and executives cover up secrets, illegal acts, or unethical behavior. Maintaining a rotten culture requires a lot of work and resources that divert resources from success. Eventually toxic cultures erode and destroy the company.

My Personal Story

My first full-time job after graduating from college was with a company with a rotten corporate culture. The rot began with the owner. He kept  copy of the book Winning Through Intimidation on his desk—facing those who sat across from him. He had cut 1/4 of an inch off of the front legs of the chairs facing his desk to keep people off balance when they met with him.

His dishonesty permeated the business. He falsified performance numbers which determined bonuses for his employees. He would call the office every morning at 8am and again at 5pm for no reason other than to verify people were at their desks. Yet, he would lie about where he was and what he was doing.

He pitted employees against one another. For example, he came to me and told me the branch manager was incompetent and he needed me to step up and exert more control in the office. At the same time, and unknown to me, he told the branch manager that I was too uppity and that she needed to put me in my place and manage me better. Then, he waited to see who won. He did the same thing with 3 employees when I became manager.

Examine Your Corporate Culture

Determine any rotten or toxic habits in your corporate culture. Counter them with positive principles, values, and mission statement. Create situations in the company to enhance and internalize those positive values and virtues. Practice them. Live them.

Tuesday we will explore how the familiar stuff of human folly can destroy your business