Putnam Purchases: Rebuilding the Culture

 Putnam Purchases: Rebuilding the Culture Article

Putnam Investments confronted difficulties in 2003 because it became a target of scrutiny investigation, because the firm was mixed up in issues of market timing and past due trading. By then, Lawrence Lasser had been the CEO of Putnam for almost 17 years. The traditions of the business was built around pecking order, individual success, and hostile, sales-driven development. Lasser's daily small activities did affect the culture from the company and gradually the weak traditions led to the difficulties faced by the firm in 2003. One of the representative cases is the expense philosophy below Lasser's leadership. Lasser aimed at the initial financial comes back and quick requisition of recent customers. Staff were motivated to do what ever they could to beat the benchmark, and sell any new pay for regardless of whether it is a well-designed expenditure. The incentive system and the weekly performance reviews produced tremendous amount of pressure upon employees. Beneath this kind of primary strategy and culture, staff were camping tent to take higher risks to pursue initial returns no matter whether it is honest or based on compliance. In addition , the " market timing” was not precise by the SEC. As a result, Putnam Investment saw a rapid development in the 1990's, but soon the growth was reversed plus the unfair trading practices had been investigated. Change of company culture can occur when a crystal clear crisis shows. When Haldeman took impose of Putnam Investment, this individual faced vital decisions in how the company would work with regulators, staff, and consumers. In the initial, he had to take care of the internal and external injuries caused by the urgent turmoil; in the long term, he must consider the sustainable competitive features of the company in the market. His process of repairing the culture is Theory O type, which is based upon organizational functionality. This approach is usually geared toward increasing the corporate lifestyle: employee actions, attitudes,...