How exceptions destroy organizational culture

By Kim Jong-nam

There are no rules without exceptions. This is a commonly acknowledged truth. However, if the number of exceptions becomes extreme in an organization, its organizational culture will be infiltrated by a feeling of mistrust, which will hurt both productivity and employees' psychology. Thus, managing the amount of exceptions is no less important than managing people itself, and is ultimately a crucial part of managing organizational culture. However, it is easy for leaders to overlook the importance of monitoring exceptions because, after all, no societies are perfect. Let's look at some consequences that are common in many organizations and damage organizational culture. This phenomenon is particularly commonplace in small or unstructured organizations.

First, it is widely reported that many younger people see the level of justice and equality as very important in selecting an organization to work for. However, a lack of regular justice is all too easy to find due to both an absence of directives and regulations that apply to everyone and an unawareness on the part of leaders. It is not only about whether all people are treated the same, but also a matter of whether the rules are applied to all tasks consistently. If the rules are not detailed, exceptions will naturally grow in the cracks. Many organizations lack sufficient rules and regulations, especially in the areas of HR policy and work management. Rules and procedures are necessary guards against the unraveling of an organization's culture. It is equally important to emphasize abiding by regulations when they do exist.

Second, top leaders and managers should become role models in terms of not making any exceptions. If they begin to make exceptions, they will create a climate in which people think those who follow rules and regulations will suffer for it. This will naturally create a belief among employees that they should not do anything that goes beyond their explicit responsibilities, meaning that they will do the bare minimum required of them. This explains the rise of "quiet quitting," which is a current trend related to justice, or the lack thereof, in organizations.

Even though leaders should encourage employees to follow the rules, they themselves often become rule breakers and the culprits at the hearts of toxic organizational cultures. When leaders make exceptions, they tell themselves that nobody will know and, even if someone does find out, it will not cause significant problems. However, this is a mistake: people will eventually find out, and their discoveries will contribute to creating a harmful culture.

Third, organizations with top-down cultures should consider whether their top-down cultures themselves are allowing some people to create exceptions for their convenience. Within top-down cultures, leaders tend to think that creating exceptions is their right in managing their organizations. The problem here lies in the fact that people who do not have a horizontal relationship with their leaders cannot talk about exceptions or unfairnesses, so they begin complaining that, since the culture is very hierarchical, leaders tend to think that they can do whatever they want to. Any type of exception can be seen as unfairness, which will create a general perception that the culture itself is unfair.

Fourth, it is also important that a lack of trust can create the illusion of exceptions even when they do not actually exist. When there is no transparency, many people will suspect that the systems of pay, evaluation, promotion, etc., contain exceptions and unfairnesses. Standards, methods, and processes should be clearly shared with employees, or else this mistrust and suspicion will grow. Anything that an organization hides can lead to misunderstandings that will create the illusion of exceptions. Additionally, if people do not know much about each other, they may begin to make assumptions about certain groups being treated differently or better, based on incomplete information. This phenomenon is not uncommon.

Of course, some exceptions are unavoidable. If they are absolutely necessary (and they may be less necessary than you think), they should be publicly announced and justified at length to mitigate any feelings of unfairness. If there are many exceptions, it is easier for people to lose their sense of commitment to their organization, which will then make them more willing to leave. After COVID-19, many organizations are now concerned about the amount of employees who are leaving. These organizations have generally concluded that this exodus is due to a wish for better work conditions. However, work conditions are not the sole factors. Fairness and justice are also important, as they have a big impact on employees' mindsets and the organizational culture. If you want to create an organizational culture that your employees consider fair and desirable, please think about whether you are creating any exceptions. They can be more damaging than one might suspect.

Kim Jong-nam is the founding CEO of Culture Engine (www.cultureengine.co.kr), which specializes in organizational culture change via consulting, training and coaching.