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Traeger's CEO on Cleaning Up a Toxic Culture
In October 2014 the author arrived at work to find one of his company's big-rig trucks aflame in the parking lot, obviously a victim of arson. This was an extreme manifestation of a corrosive problem: Traeger's culture had become poisonous, characterized by lack of trust, negative attitudes, and a stubborn refusal to collaborate. Very early in his tenure, employees would ignore Andrus when he asked for data, or simply refuse to work together on a project. Once, when he was visiting headquarters, the CFO said he couldn't find any time in his schedule to meet with the new CEO. Although the majority owner had no operating role, he talked daily to people at all levels of the company and was aggressive and abusive. People were afraid of him, but they acted as if he were in charge. After the truck fire, Andrus resolved to start from scratch. He bought out the majority owner, moved the headquarters from Oregon to Utah, carefully winnowed the employees, worked to create a physical environment that feels true to the brand, and built a community of fans and influencers on social media. The company's strategy, marketing, and product line were all overhauled. In just five years, sales grew from $70 million to nearly $400 million. -
Can You Fix a Toxic Culture Without Firing People? (HBR Case Study and Commentary)
FB Holdings had made it through the financial crisis of 2008 without losing money, but Franklin, its automotive climate control systems division, had not fared as well. It had the unfortunate distinction of having been the group's poorest-performing unit for nearly a decade. As CFO, Noelle Freeman was, of course, concerned about the numbers. But after spending time in Little Rock, she worried they might be facing a bigger problem. She knew the plant had been through years of belt-tightening and turnover, so she hadn't expected a warm welcome, but the negative vibe she'd felt from the employees had been even worse than she'd expected. The word that kept popping into her mind was "toxic." A numbers person, Noelle had assumed that once the division was out of the red, the people problems would go away. Now she wondered if the low morale and disengagement was a problem a spreadsheet just couldn't fix. This fictional case study by Francesca Gino features expert commentary by Philipp Schramm and Jeremy Andrus. -
Can You Fix a Toxic Culture Without Firing People? (Commentary for HBR Case Study)
FB Holdings had made it through the financial crisis of 2008 without losing money, but Franklin, its automotive climate control systems division, had not fared as well. It had the unfortunate distinction of having been the group's poorest-performing unit for nearly a decade. As CFO, Noelle Freeman was, of course, concerned about the numbers. But after spending time in Little Rock, she worried they might be facing a bigger problem. She knew the plant had been through years of belt-tightening and turnover, so she hadn't expected a warm welcome, but the negative vibe she'd felt from the employees had been even worse than she'd expected. The word that kept popping into her mind was "toxic." A numbers person, Noelle had assumed that once the division was out of the red, the people problems would go away. Now she wondered if the low morale and disengagement was a problem a spreadsheet just couldn't fix. This fictional case study by Francesca Gino features expert commentary by Philipp Schramm and Jeremy Andrus.