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9.6 Case Studies

Culture on the Trading Floor

On Wall Street, S&T means sales and trades of stock, and it’s generally carried out by teams working for a bank or investment house. It’s their job to sniff out the best buys (and recommend them to their clients), while also picking up on which shares may be in for a fall so they can be unloaded fast.

On one of’s forum pages, welcome2nyc starts a thread this way: I was curious to know the culture of S&T. Can anyone give an honest opinion?welcome2nyc, March 20, 2010 (9:09 p.m.), “Culture on the Trading Floor…Changed?,”, accessed May 25, 2011,


  1. What is a corporate culture?
  2. A contributor named creditderivatives posts this about the culture at Deutsche Bank Equities: “These guys were brilliant and no-nonsense. Very tolerant atmosphere, but very focused. These guys argued over the correct pricing approach for equity swaps as opposed to which March Madness bound team had the best chance of winning it all.”

    An “equity swap” is a complex financial bet, but in the end it comes down to this: one side believes a stock will go up (or down) more than another, and they put money on it.

    • There’s not a lot of information here, but from what you have, can you brainstorm a short list of words fitting the culture and values Deutsche Bank fosters?
    • One important characteristic of corporate culture is employee interaction: the way workers relate to each other on the job. At Deutsche Bank, does it sound like the culture values teamwork among workers, competition, or some mix? Explain.
  3. BigFatPanda writes, “I’d rather work on a desk with the trash talk, like where people are on the verge of cutting each other.”

    “A desk” is Wall Street talk for a team of analysts working together on investment strategies.

    • How would you describe the culture BigFatPanda prefers?
    • One of the recurring questions all managers face is “Will more and better work get done if people work together or compete with each other?” It’s pretty obvious where BigFatPanda comes down on this. From what he says and the way he says it, what do you suppose are some of the potential disadvantages of this organizational culture of competition?
  4. jjc1122 writes, “When i used to work at the chicago mercantile exchange, there were a lot of crazy stuff. traders routinely doing coke in the bathroom, old irish guys hurling racial insults, fights, and sleeping with their hot female clerks.”

    He adds that his experience dates from 2005, but he’d heard that things were actually a lot crazier in the earlier part of the decade.

    • Two aspects of corporate culture are workplace mood (the social energy and decorum of an office) and leisure time (what coworkers do and the way they relate to each other when not at work). How has jjc1122’s manager tuned those aspects of the organization’s culture?
    • One aspect of working culture involves life values—that is, the extent to which on-the-job experience leaks out to color nonwork concerns and life. What kinds of life values are exhibited by this organization? What kind of theoretical ethical argument could be made to criticize the manager’s promotion of these values?
    • The two basic ways that an organizational culture is instilled are codes (established rules guiding an organization’s members) and social conditioning (guidance is provided by following the cues and examples of others in the organization). Do you suspect the values of jjc1122’s Chicago Mercantile Exchange workplace were established more by codes or social conditioning? Why?
    • The instillation of a workplace culture through social conditioning functions in a variety of ways. Three are listed here. Can you fill in for each how it may have worked in the Chicago Mercantile Exchange in 2005?

      1. Stories and myths embedded in daily conversations may indicate culturally appropriate conduct.
      2. Heroes or stars in the organization may consistently communicate a common message about the organization’s guiding values.
      3. The dress, speech, and physical work setting may be arranged to cohere with the organization’s values.
    • One social way that an organizational culture may reinforce itself is through a self-selective process. What is a self-selective process? How might that process have worked to reinforce the values guiding work life at the Chicago Mercantile Exchange?
  5. Bondarb writes, “When i am out with goldman people and somebody tells a joke they all look at the most senior GS person there to see if they are allowed to laugh.” GS is Goldman Sachs, the global investment bank.

    • Make the case that employees constantly looking to superiors for guidance—even whether they should laugh at a joke—shows that a strong, clear corporate culture exists at Goldman.
    • Make the case that employees constantly looking to superiors for guidance—even whether they should laugh at a joke—shows that a weak, ill-defined corporate culture exists at Goldman.

Corporate Culture at Herschend Family Entertainment

Joel Manby is CEO of Herschend Family Entertainment, a $300 million corporation employing more than 10,000 people at two dozen theme parks around the country. They put on everything from massive aquariums to Dollywood, the Dolly Parton theme park in Tennessee.

In an interview, Manby discusses the corporate culture infusing the properties. It’s composed of eight attributes:

  1. Patience
  2. Kindness
  3. Honesty
  4. Humility
  5. Respectfulness
  6. Selflessness
  7. Forgiveness
  8. Commitment

Manby exemplifies the corporate values he’s trying to instill this way, “You can dislike somebody, but you can still respect them, forgive them, and treat them with humility and honesty. We also have a phrase: ‘admonish in private, praise in public.’ So you don’t embarrass people.”

Manby explains that 50 percent of a Herschend executive’s year-end bonus is awarded on the basis of how well the organization’s culture is exhibited and promoted. As he puts it, “You have to put your money where your mouth is.”

He concludes with this: “It’s all about hiring the right people. You know, this culture either resonates with people or it doesn’t. If it doesn’t, they’re not going to enjoy working here.”Steve Tobak, Undercover Boss: Escaping GM’s Abusive Corporate Culture,” The Corner Office (blog), BNET, March 30, 2010, accessed May 25, 2011,


  1. The characteristics of corporate culture elaborated in this chapter were the following. Corporate culture is

    • shared,
    • a provider of guidance,
    • a provider of meaning in the organization,
    • top heavy,
    • a constellation of values,
    • a dynamic constellation of values,
    • organic,
    • inclusive of life values.

    Choose three of these characteristics and show how the culture Manby promotes at Herschend Family Entertainment relates with each one.

  2. What is a corporate culture ethics audit? What does it attempt to measure?
  3. If a corporate culture ethics audit were taken of this company, how do you suppose it would fare? Why?
  4. Before coming to Herschend, Manby was CEO of Saab, a division of General Motors. His time there was marked by a very different organizational culture. According to him, “I don’t want to bash GM, but intimidation was part of the culture there. You would get ridiculed in meetings. The CEOs had big egos and had no problem making you look silly. I once missed one of my numbers. I didn’t miss it by that much, but the president of all of Saab calls me and orders me to fly over there [to Europe]. I get there Monday morning, he chews me out for four hours, and then I get on a plane and fly back. It was so humiliating, so uncalled for. I figured, if that’s the way I’m going to be treated, I don’t need that. That’s when I began looking at other opportunities.”Steve Tobak, Undercover Boss: Escaping GM’s Abusive Corporate Culture,” The Corner Office (blog), BNET, March 30, 2010, accessed May 25, 2011,, brackets in the original.

    Manby lists the attributes of the culture at Herschend—patience, kindness, honesty, and so on. What might a similar list look like for Saab?

  5. Corporate culture provides an organization’s meaning; it defines what counts as success.

    • For Herschend, what counts as success?
    • For Saab, what counts as success?
  6. A corporate culture distinguishes workers from people who work. What is the distinction?

    • How does Herschend fit into this distinction?
    • How does Saab fit into this distinction?
  7. Manby says, “Apple’s culture, for example, would be very different from ours, but Steve Jobs is still an incredibly successful CEO. I’m not pretending we’re right and others are wrong; it’s just our culture, and it works for us.”

    Explain how Manby can say that a set of ethical values isn’t right or wrong, but one set (at Saab) is wrong for him, and another set (at Herschend) is right for him?

Even Better Than the Real Thing

The web store sells fakes—very good copies of purses originally made by Louis Vuitton and similar high-end brands. The price is right: a $1,800 Prada bag can be purchased as a copy for about $180. At Finer Bags, they’re totally open about what they’re doing, and their home page lists the advantages of buying their products. According to the leadership at Finer Bags, “Millions of replica handbags can be found on internet these days, they are not a rare thing anymore. Maybe the Louis Vuitton handbag that your friend bought is a perfect replica. Maybe the Louis Vuitton Monogram Speedy 30 that Linda paid $1,200 for is a replica handbag. Maybe those replica bags all were bought from”Business Ethics Workshop, accessed May 25, 2011,


  1. Would you call honesty part of the corporate culture at Finer Bags? Yes, no, or both? Explain.
  2. Corporate cultural dissonance occurs when what actually happens on the ground doesn’t jibe with the principles supposedly controlling things from above. Do you suspect that dissonance is occurring here? Why or why not?
  3. This company is selling counterfeit purses, bags designed to trick people into thinking they’re real when they’re not. No one denies that.

    • Could you use a utilitarian argument (bring the greatest good and happiness to the greatest number) to justify this corporate culture and business endeavor as ethically respectable?
    • Could you use either a basic duties argument (right and wrong is defined by preexisting principles) or Kant’s categorical imperative (to be right an act must be universalizable) to make the ethical case that this company should put itself out of business?
  4. This line from the web page is curious: “Maybe the Louis Vuitton Monogram Speedy 30 that Linda paid $1,200 for is a replica handbag.” It’s important to know that the price of the real thing is about $1,200. The point being made is that people can end up paying full price for a copy. If that’s true, it sounds like Finer Bags is inviting people like you and me to realize that we can buy their fakes and then sell them as real, pocketing the difference.

    • Imagine you buy a few replicas for $120. Then you spread word around campus that your mom is a major department store buyer and handed off a few Louis Vuitton Monogram Speedy 30s that you’re now selling at the absurdly low price of…$800. Can you sketch an argument to ethically justify your business model? What kind of ethical theory could it be based on? How would you respond to a consumer who discovered the trick?
    • Imagine you have so much success that you hire some friends to go around selling bags at nearby colleges. Would you tell them the truth about the source of your bags or keep up the mommy lie? Why? What ethical justification could you sketch to support your decision?
    • One reason to lie to the people you hire to sell the bags elsewhere is to help them do their job well. If they believe the bags are the real thing, they may find it much easier to enthusiastically promote their product. Is there any ethical difference between lying to employees to help them improve their work performance as purse salespeople and lying to consumers about what they’re getting when they make a purchase? If not, why not? If so, what’s the difference?
    • Can you think of examples in the world where managers don’t tell their employees the whole truth about a situation and believe they’re doing the right thing? What is such a situation? Is it the right thing?
    • Assume you’re running the fake purse outfit and hiring sales reps for other schools. You decide to maintain the lie about the purses’ origin. How do you think your small business would fare on a corporate culture ethics audit? Why?
  5. Assume you’re running the fake purse outfit and hiring sales reps for other schools. You decide to reveal the truth about the purses’ origin to the reps. What you need to do next is instill a corporate culture that fosters lying. Common ways of instilling a workplace culture include the following:

    • The founder’s ethical legacy to the organization may contribute to its living culture.
    • Stories and myths embedded in daily conversations may indicate culturally appropriate conduct.
    • Heroes or stars in the organization may consistently communicate a common message about the organization’s guiding values.
    • The dress, speech, and physical work setting may be arranged to cohere with the organization’s values.
    • An organizational culture may reinforce itself through self-selective processes.

    How might these or other strategies of social conditioning be used to create a working culture that values lying?

  6. If you discuss this case in class, there’ll be people loudly proclaiming that this fake bag business is despicable and completely wrong. Then they’ll go home, hit up on the Internet, and spend the next hour trying to figure out if they can make the scheme work on your campus. It is good money. Now, is there any ethical difference between someone who lies in a social situation like a class and someone who lies as a way of doing business?

“I Created Studio 54!”

Not all leadership jobs are exercised from on top of a pyramid, with the president on the highest level, vice presidents below, then directors beneath them, and so on. Take the case of Carmen D’Alessio. “I created Studio 54!” she proclaims, even though she didn’t own any part of the club or have any official role in the way it was run. Still, according to her, if you want to find out about the once-thriving business, “I’m the most important person to talk to.”Jada Yuan, “As the Disco Ball Turns,” New York, April 30, 2007, accessed May 25, 2011,

In the 1980s, Studio 54 was the New York City club. It began, according to D’Alessio, soon after she dined with two men—Ian Schrager and Steve Rubell—who owned a club in Queens, New York, an area not considered particularly trendy. She thought that Rubell possibly had some raw night-clubbing talent, so she encouraged him to bring his skills to hipper Manhattan.

To generate buzz before Studio 54 actually opened, she dressed Schrager and Rubell in Armani suits and threw a dinner in their honor attended by celebrated artist Andy Warhol, clothing designers Halston and Calvin Klein, and a host of similarly bright luminaries. Then, on the club’s first night, they went for an outlandish theme bash: 1001 Nights with elephants, camels, tents, men wearing turbans, belly dancers, and everything else packed onto the disco floor. Soon after the remarkable event, a widely distributed magazine at the time, Newsweek, put Studio 54 on their cover.

The parties D’Alessio threw were as outrageous and scandalous as the guests who turned up. One night Bianca Jagger (ex of Mick) rode in on a white horse; on another the designer Valentino got to act as the ringleader of real circus animals. Armani was feted with a drag-queen ballet. The bartenders were young, male, built, and shirtless. The busboys doubled as entertainers: dressed in tight little white shorts, bowties, and nothing else, they were given illicit drugs and a small paycheck and told to pick up glasses and party with the guests, who included fashion designers, artists, and unique people like Johannes von Thurn und Taxis, a flaming and wealthy European aristocrat whose wife was thirty years younger and so explosive that people called her Princess TNT. Malcolm Forbes, the hard-nosed American businessman, was a regular too. Everyone was welcome, as long as they were interesting.

In talking about it now, Carmen D’Alessio gives credit to the others, but never lets anyone forget what Andy Warhol said about Studio 54’s more visible leaders, Ian Schrager and Steve Rubell: “Carmen brought, hand in hand, Ian and Steve to the Big Apple.”


  1. The line outside Studio 54 was infamous. People stretched around the block and waited hours to get in. Some waited all night and never reached the door. One reason things went so slowly for many is that D’Alessio enjoyed swooping out of the club, running down the line, and hand picking people to jump ahead and go straight in.

    • Andy Warhol said this about D’Alessio: “She has gone everywhere from Rome to Rio. Anywhere there is a party and until the party lasts, she’ll be there, because she has a list of the rich, the beautiful and the young.”Steve Lewis, “Good Night Mr. Lewis: Carmen D’Alessio’s Fabulous Life,”, December 11, 2008, accessed May 25, 2011, Can you make a good guess about the kind of people that D’Alessio chose for quick entry?
    • Essentially, D’Alessio chose some clients for better service than others. Justify this management strategy ethically.
    • Another entertainment company with lines is Herschend, the parent corporation of many Disneyland-like theme parks around the country. The lines there—waiting to get on the roller coaster, to buy popcorn, to go to the bathroom—are first come, first served. The values Herschend uses to define its culture (patience, kindness, honesty, humility, respectfulness, selflessness, forgiveness, commitment) fit well with the egalitarian treatment. If you were in charge at Studio 54, what kind of values could you array to help employees and others understand why the line outside the bar moved so unevenly?
  2. Studio 54 was a big-time vice den. Upstairs in the shadowy balcony people regularly coupled. Drugs were as common as beer. (A large glittery moon with a face and arms hung from the ceiling. It was snorting cocaine.) Management knew about all this and encouraged it.

    • With a focus on the facts that D’Alessio and company generally hired young, attractive, and muscular men, asked them to work with almost no clothes, and fed them drugs to brighten their attitudes, how would you characterize management’s culture with respect to employees? Were they valued as mercenaries, as something closer to members of a family, as something else? (Remember, guys lined up to apply for these coveted posts.)
    • How would you describe the Studio 54 attitude toward its consumers? Were they valued as people to be fleeced of their money, as participants in a shared project? Something else? Why do you think that?
  3. Though not a lot of clothing was worn by frontline employees, this doesn’t change the fact that there was a very strict dress code at Studio 54.

    • In ethical terms, is there any difference between requiring guys to wear almost nothing while they hustle around the bar delivering drinks and, in a different business, requiring guys to wear neat, stiff uniforms while they hustle around a neighborhood delivering Domino’s pizzas? If there is a difference, what is it? If not, why not?
    • Unlike Domino’s, Studio 54 had a semiofficial body requirement for employees: the guys needed to be beefy and fit. In thinking about the management decision to impose both dress codes and body requirements, how are these two demands similar and how are they different? Is one less ethically problematic than another? Why or why not?
    • What are some ethical justifications an owner could cite for enforcing a dress code in general, regardless of whether it’s a near-nude barboy or a Domino’s driver? How would those arguments apply in the specific case of Studio 54?
  4. Carmen D’Alessio was behind the scenes at Studio 54, throwing the parties, arranging people, setting the tone of the place. With respect to Daniel Goleman’s six basic leadership personas listed below, which ones do you suspect correspond with D’Alessio, and which don’t fit her so well? Why?

    • Visionary
    • Coach
    • Affiliative
    • Democratic
    • Pacesetter
    • Commander
  5. What is transformational leadership? What is transactional leadership? Does D’Alessio share characteristics with one or both? How?
  6. Part of the reason for naming a leadership style a leadership persona is to underline the idea that being a leader can be like donning a mask: you can be whatever you choose when you stand in front of others and direct. Besides being a leader at Studio 54, D’Alessio was also a massive partier. How is adopting a personality for leading an organization like adopting a style to exhibit when you go out with friends on the weekend?

    • Is there anything ethically wrong with adopting a mask for your public self? Is so, what? If not, why not?