Is your paternalistic culture killing your business?

Crystal Spraggins, SPHR

A company’s culture, or personality, is a very big deal. Just as an individual’s personality can be a help or a hindrance to meeting certain personal goals, a company’s “personality” can be a help or a hindrance to meeting certain organizational goals.

Let’s face it. Some cultures are stinky (hopefully you don’t work in one of those) and characterized by dysfunction, including a lack of transparency, a lack of trust, backbiting, fear, and a bunch of other icky stuff.

But your company culture doesn’t have to be wicked to be impeding progress. Certain cultures lend themselves to stunted company growth. One such culture is the paternalistic culture.

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Paternalistic culture defined

The paternalistic culture is characterized by its paternalistic leadership style. Paternalistic leadership has been around since forever, and I’m not just saying that. One of my favorite stories about the perils of paternalistic management involves the Lukens Steel Factory strike of 1887.

Times had gotten tough, and the factory owner decided to reduce pay and benefits. However, times were tough for the workers, too, so they demanded higher wages and went on strike. The owner waited a bit for the workers to see reason, but when he concluded the strikers weren’t backing down, he promptly kicked them out of their employer-provided homes and fired them.

Apparently, this paternalistic leader viewed the strike as a challenge to his authority, and he wasn’t having any of that.

A paternalistic leadership style/culture is built on the premise that “Dad knows best.” Paternalistic cultures are characterized by opaque management, closed decision making, and a notable lack of employee development, because loyalty and obedience tend to be more important than performance.

It’s not all bad …
A paternalistic culture definitely has it pluses, and certain types of employees will warm to a paternalistic style of management with very little encouragement. This style also suits authoritative types who like to be in charge.

But what happens when the “children” in the family are ready to grow up? Or when Dad needs the kids to step up? Ah … that’s when the trouble starts.

The downside of paternalism

A paternalistic culture works well when profits are expanding, business is stable, and innovation and development aren’t a priority. It doesn’t work so well, however, when these things aren’t true.

Remember the Lukens factory strike? The owner believed that he’d taken such good care of his workers they’d never “turn” on him, but when business slowed and wages were cut, workers considered the welfare of their real families and found the owner’s care wanting.

And that’s the biggest downside of a paternalistic culture. It’s not sustainable. As the company grows or times change, the organization will find itself fighting against its culture to thrive. Consider the following:

  • When employees are treated like children, they’ll act like children. This includes not thinking for themselves, waiting to be told what to do, and not wanting to be held accountable.
  • While employees value a great salary, benefits, and other perks, they also value having their ideas heard and considered as well as opportunities to learn and grow. In fact, your best employees value these other things so much, they’ll go elsewhere to find them.
  • It may be a cliche, but it’s true—it’s lonely at the top. There’s a price to pay for making all the decisions, always having to be right, and holding yourself personally responsible for everyone’s happiness.
  • Performance really does matter. If you continue to reward employees based on their likability, loyalty, and willingness to not make waves instead of their progress toward a goal, your business will suffer as a result.

Paternalistic cultures are particularly common in smaller companies or family-owned and managed businesses, and there are plenty of businesses, I’m sure, that see no limitations to this leadership style.

That said, research indicates that companies focusing more on servant leadership, wherein employees are treated as partners, not children, do quite well, and this culture can aid growth, not inhibit it.


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