Cultural fit and Complexity

Interview with Professor Amir Goldberg on cultural fit

What it means to “fit in” and why it matters

Almost everyone has had the experience of what it feels like to try to fit in to a new social environment. Companies consider cultural fit of applicants when making hiring decisions. Cultural fit can even be used as an argument in court: in 2012, Ellen Pao lost her discrimination case against the venture capital firm Kleiner Perkins based in part on an argument that she was denied a promotion not based on her gender but rather that she had a poor cultural fit.

Associate Professor in the Stanford Graduate School of Business Amir Goldberg argues that cultural fit matters for the social group and the individual. Professor Goldberg spoke at the Stanford Complexity Symposium on November 14, 2017, describing his work related to measuring cultural fit. Drawing on previous research on cultural fit from managerial science as well as psychology and sociology, Professor Goldberg outlines the difference between cognitive cultural fit- how one’s private self adheres to the surrounding culture- and behavioral culture fit- how one’s behaviors adhere to the surrounding culture.

His 2017 paper with Sameer B. Srivastava, V. Govind Manian, and Christopher Potts, on which his symposium talk is focused, introduces an innovative method for measuring cultural fit, in which they consider “culture” to emerge from individual interactions. The method used in this paper compared the language use of incoming and outgoing messages between employees at the same company. They measured the similarity of different “lexicographic units”, i.e. the usage of different words as well as punctuation etc.

To illustrate how different cultural norms are reflected in lexicographic unit usage differences, consider these starkly different example emails from executives at Sony and Enron.

Figure from Sameer B. Srivastava, Amir Goldberg, V. Govind Manian, Christopher Potts (2017) Enculturation Trajectories: Language, Cultural Adaptation, and Individual Outcomes in Organizations. Management Science. For details on the standardization of the timeline, see their paper below

Using this method, their work demonstrates how, in a corporate setting, an individual’s cultural fit can change over time. They found that a person’s cultural fit when they joined an organization didn’t matter as much for their success at the company as their cultural fit trajectory over time. Those who were let go tended to decrease their cultural fit over time. Those who stayed tended to increase their cultural fit. A third group, who quit, increased then decreased their cultural fit.

Figure from Sameer B. Srivastava, Amir Goldberg, V. Govind Manian, Christopher Potts (2017) Enculturation Trajectories: Language, Cultural Adaptation, and Individual Outcomes in Organizations. Management Science. Sony and Enron emails are referenced from publicly available archives.

Professor Goldberg’s talk sparked an interesting discussion at our symposium about how culture is a complex system, how this insight helps us to better understand culture, and what the implications of this work could be. Stanford Complexity Group (SCG) sat down with Professor Goldberg to learn more.

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[Interview has been edited for clarity and length]

SCG: You talk about the cultural norms as an emergent process from these individual interactions. Could you speak on how that might be different in terms of top-down cultural norms? For example, people say that at Amazon they believe in frugality as an important value, which could be like a cultural norm.

Prof. Goldberg: First, you want to ask yourself: where does culture exist? Who defines culture- is it CEOs? Priests? Soviet idealogues? Or is culture actually what happens on the ground? The way that culture matters is how the translation from beliefs to behaviors is distributed across a population.

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Where does culture exist?

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Even if the corporation leader says that the ethos is “frugality” and whether the ethos is “frugality” is only the ethos insomuch as it’s what people believe is a desirable behavior and that’s what they pursue. It’s an empirical question. The fact that Amazon believes in frugality and Jeff Bezos tells us that’s what they believe, that tells us nothing about how they behave unsupervised. What really matters is the extent to which there’s buy-in and the extent to which this buy-in is held together in equilibrium with the normative behaviors of others.

No one at Enron said the ethos was to cheat and to steal money. They had very beautiful “serve the customer” or whatever that they put on their walls. But there’s a big difference between saying it and creating the normative environment that actually rewards those behaviors.

I think every culture is a complex system and is a complex equilibrium of norms, where the norms are are basically the enacted behaviors and beliefs, which the privately held perceptions that lead to these.

SCG: You mention here the difference and relationship between cognitive and behavioral cultural fit. When you’re measuring people’s emails in this research project, that’s their behavioral cultural fit, right? Could you please explain how cognitive and behavioral cultural fit are related and how the differences between them may end up mattering, for a company or for an individual’s success?

Prof. Goldberg: The prior we come into in the research is that they’re correlated, but the more we’re scraping beneath the surface we realize that that assumption may be incorrect. And this harkens back to some of the most fundamental work in sociology by an ethnographer, Erving Goffman: The Presentation of Self in Everyday Life. He has this metaphor of the backstage and the front stage. It’s known as the “dramaturgical model” of social interaction- that basically every interaction is a form of performance and in every interaction people present themselves. When they interact there are lots of thoughts going on in their heads that they are not communicating and their “performance” in the interaction needs to adhere to a certain code about what’s appropriate and what’s not.

One thing that came out of that research were these “breaching experiments”. When people behave in really weird ways. There are very clear expectations about what is appropriate behavior and what are various signals about one’s expectations about how they expect from their interlocutor to behave, even in a transient interaction. I think it’s those moments where these codes are breached that make salient to us how much of these behaviors is codified.  

One of the realizations we’ve come up to in the work we’ve done is that an important dimension is a person’s capacity to read the code- to understand what is appropriate and normative and to have a mental model of what the other expects.

SCG: In an organization, would you say that only the behavioral cultural fit matters?

Prof. Goldberg: It’s not the only thing that matters. It matters for the individual because that is what others see. That’s what’s communicated about the implied beliefs of the individuals. We know there are some people who are chameleons, they’re very good at adapting. They think to themselves, “I don’t buy into this place. I hate this place. But I’m going to behave as if I do.”

This is often referred to in psychology as “self-monitoring”. It’s one’s capacity to monitor their authentic self and to present themselves in a way which is congruent with what their interlocutor’s expectations are. And how do you infer what their interlocutor’s expectations are? As a function of their interlocutor’s behavior as well. So there’s a delicate equilibrium, and as long as the expectation is held, those who are capable of strategic action, those who are good code readers, will behave in a way that is congruent with the code, irrespective of their private beliefs.

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Culture can sustain a handful of people who are fakers, but overall it is difficult.

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On average you would expect if there is a significant incongruence between beliefs and behaviors across the population then that culture is not sustainable. Culture can sustain a handful of people who are fakers, but overall it is difficult.

SCG: Is this something that you’re working on?

The science is relatively early in understanding what are the conditions in which there is or is not congruence between the private and the public self and what are the implications. We have a new paper that is precisely about that. We call it “lifting the curtain”. It’s about this metaphor.

Thinking about complexity, in the aggregate these are nonlinear relationships. Imagine you can measure the difference between the behaviors and the private beliefs of an individual and average them across the organization. I imagine there would not be a linear relationship between that and the strength of the culture, or between that and the likelihood of that culture collapsing. We know with complex systems, these complex interactions can lead to phase transitions.

SCG: Can you talk how your research might be applied in a corporate setting? When we’re talking about cultural fit there are also other demographic factors that affect whether or not someone fits in. If someone is 65 and they work at Snapchat, they may have difficulty fitting in because they’re misreading cues but they also might not be fitting in because they’re 65 and the average age is something like 22. You also mentioned in your talk that women tend to match better but tend to be rewarded for it less.

Prof. Goldberg: There’s a relationship between socio-demographics and cultural preferences. Sometimes, socio-demographics are good proxies for cultural preferences but sometimes they’re not. This is different than saying that people interact with people of different social categories in discriminating or compensating ways. So some people might be gender discriminatory in certain ways and that’s going to be irrespective of that woman’s behaviors towards them. But when we think more broadly about what are the implications, we have a more refined tool looking at cultural fit above and beyond crude socio-demographic categories. There’s a way to see first of all to test which social categories are homogenous or not homogenous in their capability to fit or things of that sort.

I think the example that I gave about gender is not so much related to women’s capability of women’s ability to read the code, it’s about gendered biases about how the behaviors of women are interpreted. That are not specific to this firm but are specific to American culture- one of the most gender-equitable cultures but is still a misogynistic culture- there’s probably a lot of variance in misogyny or whatever you want to call it across organizations.

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I don’t want someone to create a Minority Report kind of world.

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But I’m a little wary about implications. I don’t want someone to create a Minority Report kind of world where they come into an organization and fire people because our algorithm suggests that they’re going to get fired later.

In terms of the implications, what is my responsibility here? I think scientists need to think about the implications of what they do. So, I’m not going to give myself a free pass. That’s why it’s important whenever I talk in public to say I would be averse to having this technology being used in any way, shape, or form to affect the lives of individuals. I think it would be a diagnostic tool for understanding organizations or maybe measuring the cultural health of an organization but I would be strongly opposed to it being used to determine the fates of individuals.

I think one message that comes out of our study is that the vast majority of the way corporate leaders think about culture is that they think about cultural fit. For example, they hire for cultural fit. I think that’s a part of it, yes, but another really important part but that there are people who are capable of adapting. We might call it faking it which might seem like a bad thing, but if we accept that all interactions are a performance, we’re all faking it all the time. So, maybe it’s important to have people who are capable of faking.

I think it’s easier to measure cultural fit at entry, it’s harder to measure people and to think systematically how they’re fitting in over time. I think that’s one implication is that we need to think about how to manage our organization that’s attentive to post-hire cultural change. I think it is my responsibility and it’s important to consider implications because the finding are sexy, the curves are beautiful. But a 95% confidence interval is a 95% interval. There a lot of people who fall outside of the confidence interval and we need to remember that. Small changes might have phase transition effects and I don’t want anyone to get fired for being slightly outside the confidence interval.

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Data is not panacea.

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Data is not panacea. The thought that we would just come with algorithms and solve all our problems is a frightening and misconceived thought. First of all, data is only as good as the quality of real phenomena that it represents. But second, it’s only as good as the analysis it’s applied to. Every analysis through modelling decisions makes assumptions. If we then take the results of these modellings as objective truths about the world without assuming that our assumptions are built into them, and we affect people’s lives, then we create a terrible world. So, I’m all in favor of people analytics. But only insofar as they’re deployed responsibly and when there’s human decision involved in the process. I do not want to concede authority to bots and algorithms, including the ones that I’ve produced.

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To learn more about Professor Goldberg’s work you can check out his talk from the Stanford Complexity Symposium on November 14, 2017 (https://www.youtube.com/watch?v=BvdAjwDjeJo) or see his 2017 paper, “Enculturation Trajectories: Language, Cultural Adaptation, and Individual Outcomes in Organizations” (https://pubsonline.informs.org/doi/pdf/10.1287/mnsc.2016.2671).

 

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