The “Copycat Culture” Effect

The copycat, someone that closely imitates or mimics another. We all do it whether we realise it or not. Subconsciously or consciously we think, believe, talk and behave like those around us.

Those that we emulate or mimic are more often people we look up to. People more experienced then us, people that know more, people in positions of authority. It might be a big sister or brother growing up, the captain of the football team, the school captain or the girls scout leader.

Those leaders within the environments we inhabit. In our desire to be like them we become their copycats. And when everyone in the group starts to emulate the values, beliefs and expectations of a leader (or select leaders) groups define their culture.

That’s why when it comes to organisational culture I have always believed it is created from the top down. Imitation has the potential to be the sincerest form of flattery and as we look to become a copycat of those at the top, those with the authority, those that know what to and not to do. We look to our CEO’s.

Over the past week, the CEO’s of Australia’s leading banks were brought before a Senate inquiry. Kicking things off was CBA CEO Ian Narev.

Commentary on interest rates is an area I am particularly interested in and with CBA financing the homes (and loans) of over 2 million Australians I am certain I wasn’t the only one keen to hear this play out. On the topic, Mr Narev conceded that the decision of whether or not to pass on changes in the Reserve Bank of Australia (RBA) cash rate to the end consumer could appear “opaque” and “overly technical.”

It could be my ignorance but I thought it was pretty simple. The RBA reduces the official rate by 25bps, the banks pass on a reduction of 25bps. Not that “overly technical” to me.

As Mr Narev pointed out it is in the nation’s interest to have a strong banking sector but when record profits continue to soar, quarter after quarter, year after year, then questions need to be asked about whether the decision not to pass on rate cuts is in the nations best interest or the banks?

I believe what we are seeing from our nations leading CEOs says a lot about leadership and organisational culture. One of my favourite leadership quotes belongs to John C Maxwell and is one I use all the time with my own leadership team. “Everything rises and falls from leadership”.

When I reflect on the actions of the big four banks specific to interest rates and the action taken not to pass on the RBAs reductions in full or at all to me reflects an organisation and leadership group that doesn’t feel the needs to listen to anyone – yes that includes you RBA. A group that puts profits before people, that considers themselves above their customers, a law unto themselves.

Mr Narev’s public declaration that he would not sign the Ethics Code and admission that not one staff member was terminated following the CommInsure scandal, despite acknowledging the use of outdated medical definitions to deny claims, speaks to me not so much about failures of internal policy or process but rather failures of leadership. It is an admission that gives permission for the tolerance of unethical practices, where there are no consequences for decisions made, it tells me of a leadership group that values profit over the pain suffered by people.

For me, the behaviour of individuals inside CommInsure should come as no surprise.

As a CommInsure employee seeing the CEO, the executive team, the organisation broadly, put profits before people, then why wouldn’t I? We are a law unto ourselves, there will be no consequence. Nobody at the top gets sanctioned or dismissed, neither will I. Our CEO refuses to sign Ethical Codes, I assume being ethical is not important. Not valued. Remember, “everything rises and falls from leadership”. This is the Copy Cat Culture in full effect.

One of the ways you can create culture is through symbolism. Symbols and rituals support the embedding of culture. This was a great opportunity missed by Mr Narev to take a stand and start defining the culture by endorsing an Ethics Code, symbolising the importance of ethics in decision-making. It would have publically told people and employees that the Bank stands for and values fairness. Instead, the decision to decline became a symbol to those within and outside the organisation that the Bank would continue to endorse a lack of ethics.

Leadership is about setting an example, not just by what you say, but what you do. Employees within organisations emulate what senior leaders in organisations do.  It’s how the copycat culture effect comes to life. It is senior leadership who set the tone on culture. Culture is created and defined from the top and cascades down but where it comes to life is from within the workforce.

What leaders that foster great culture do is instil positive principles and reinforce them. And on the flip side, poor cultural leadership leads to poor values. The way culture works is you have everyone in your organisation thinking, believing, talking and behaving in the same way. It is up to you to make certain that those values, beliefs and expectations are positive.

Organisations will be tested. Environmental factors, pressure on resources, a competitive landscape that is continually changing, aggressive KPI’s to hit and all the while delivering on shareholder expectations. When organisations are tested and they stay true to their values, beliefs and expectations that is when the real embedding of culture takes place.

Whilst it is true that our leaders set the tone for our corporate culture that does not excuse or exclude us as employees of all responsibility. We all have a role to play. It’s not ok for us to just point to the top and be a copycat when we see wrong being done. You have a responsibly to lead from where you are.

You must be an example and positive influence on those that are above and below you in your organisation. You control what’s in your power and set the example through your leadership. Serve as a model for those above you and below you. You can always lead and influence from where you are.

The truly great thing about culture is that it can change. The leaders of the big four banks are currently faced with a defining moment in Australian corporate culture.

When faced with a new opportunity who will move first? If one Bank passes on a rate cut typically the rest will follow. Wouldn’t it be great if we saw the copycat effect play out for good? Putting people before profits, you might create a legacy of which others would be proud to copy.

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