6. The Seven Columns of the Andersen Model
Usually, success is identified in management literature with a good definition of the business vision and of the cultural elements that organizationally belong to that vision’s deployment. In this connection, if there is anything really shared by all observers of Arthur Andersen’s Spanish development, and probably in other areas of the world as well, it is the view that the Firm’s professionals showed a striking “cultural identity”, that coined “the Arthurs” (los Arturos) term as a clear, distinctive sign, as much for the good as for the bad.
Obviously such a generally shared observation does not come out by chance but has deep roots associated with a certain way of understanding and performing a professional activity.
In this part of the book we will try to put together what we have called “the columns”, meaning the basic principles that we believe are the foundations of the above mentioned cultural identity, and that are also highly related to the success of the organization, spanning three decades, in and out of Spain.
In the effort to discover and identify these columns we have tried to be rigorous and not let us be carried away by corporate speeches or overblown expressions that could be void of real content. Because of this, before raising a concept to the principle or “column” category, we have “stress tested” it against five criteria that could possibly be required from any value judged to be important for an organization:
- Internal recognition
- Real business impact
- Daily implementation
- Strength if virtue, risk if vice
- Systemic fit
Internal recognition
The first criterion is simply that of belonging to the official discourse. It would be obviously difficult for a value to “spread” throughout a complex organization with thousands of professionals if it is not recognized in corporate declarations; a necessary but not sufficient condition.
In this connection, it may be good to remember some historic statements of those values recognized by Andersen as corporate values along time.
Internal documents, dating from the 60s and intending to collect the legacy of the Firm’s founding father, identified already some values:
- Integrity and honesty: in order to protect the public good and consolidate a reputation as a reliable Firm.
- One Firm with One Voice: a model of office and country association based on the concept of united action and professional cooperation.
- Training: as professional development strategy, implemented by means of a shared method common to all, with deployment of mechanisms for educational and technical homogeneity, making thus possible to have a reliable workforce, well recognized by the market.
In 1986, different internal publications held as corporate the following values:
- Service to the Client: to give high quality service “without strings attached”.
- Hard work: to answer in time and form service requirements.
- One Firm: many independent practices but common objectives.
- High quality professional recruitment.
- Training and development, as the key for professional leadership.
- Meritocracy: promotion and compensation of professionals done as a function of their merits and their contribution.
- Integrity: understood as objectivity in performing professional activity, without letting “fear” or “favor” carry the day.
- Esprit de Corps: pride of belonging.
- Professional Leadership: aiming at recognition as an organization of reference.
- Solidarity: applying criteria that bring long term benefit to the Firm and renouncing short term benefit to specific persons.
In 1989, when launching the Andersen Consulting brand as an independent business unit, its statement of values is also similar, built around six concepts (shown literally):
- High quality service.
- One Firm, under the Andersen Worldwide umbrella.
- Solidarity (Stewardship).
- The best professionals.
- Respect for individuals and their personal development.
- Integrity.
And then at last, in the 1990 Annual Report, the essential values mentioned are:
- Integrity.
- Respect.
- A passion for excellence.
- One Firm.
- Solidarity (Stewardship).
- Professional Development.
Real business impact
The second criterion to recognize or identify an element as vital is to check if it makes sense as a valuable piece in business development.
Business successes, as the Arthur Andersen one in Spain, do not usually come as just the result of a vision definition or the flair and talent of their founders, but most times “structural factors” are present and the good idea comes precisely at the right time and place, amplifying the results. We could say they find “fertile ground”.
So, if we take the Andersen case in Spain, it seems clear that the country’s conditions in the 70s, in a particular context, set up very solid and adequate foundations to make the most of the huge push for change and modernization that hit the Spanish entrepreneurial structure from 1970 until the end of the century, with a very relevant demand for professional services (auditing, law and tax advice, business consulting, information systems development, etc.)
The columns, that will be developed later on, have generally a stronger impact if we deal with a society and an entrepreneurial fabric eager to integrate modern management tools in their administration systems, as was the case in Spain in those years.
Daily implementation
A third criterion for acceptance of a concept as a column is to verify, over and above official statements, if we find significant signs of its insertion in the organization’s genetic code through standards, daily practice, operating procedures, etc. The basic idea is that a strong organizational culture is built on daily work habits and not just with official discourse. In this connection, this book’s Part II collects a good number of operating practices examples, that helped build these principles or columns that we consider crucial into the daily tasks of the Firm’s professional community.
Strength if virtue, risk if vice
Fourthly, we believe that something considered a cultural value or basic business principle can be seen like a kind of virtue of the company in question, but we believe also, as for any virtue, that its obsessive or excessive application may generate a vice. The extreme opposite in virtue’s yardstick is always a vice.
In other words, the practice of a virtue or the pursuit of an organizational principle resembles how to adjust the dosage of medicines that, especially the strong ones, entail contraindications.
The principles or values are essential for successful development of any activity, but they are not a magic brew that always works and ensures without doubt the basis of success. In the business and entrepreneurial world, defining a strategy means choosing between different options and, when taking a route, we’ll always face obstacles. There are no roads without stones.
The trait marking a principle is that it is considered an essential element even if its application can bring undesired collateral effects. In that case, they must be assumed as part of the decision taken and managed in the best possible way.
When dealing with basic principles or dogma, it is essential not to fall in fundamentalist positions. The dividing line between a principled practice and a fundamentalist faith is very thin and trespassing must be avoided.
On the other side, as we will see later on, the changes in the environment along time may require adaptations or evolutionary changes in the principles, because it may happen that what was useful and valuable at a particular moment becomes restrictive or even harmful at another time.
Systemic fit
Finally, the basic principles or columns, even if they, especially for their identification and analysis, may be examined on its own as separate pieces, will in reality be fully understood only if they are looked at with a systemic view, since each and every one relates to all the others and generate reinforcing relationships with each other, as the gears of a machine that generates its own momentum, making its combination more powerful than the sum of its components.
The seven basic columns
As the result of our investigation and analysis on the Andersen Culture, the basic seven values, principles or columns that explain the Andersen Model success are:
- Unity
- Integrity
- Cooperation
- Ambition
- Talent
- Service
- Results
We shall develop the seven principles in further detail in the next seven chapters.
As we just said, they are strong, not only each one on its own, but reinforcing each other, forming a systemic ensemble, a model, that we will represent and detail on Chapter 14.