Creating a unified "corporate culture" is sure to be one of the toughest challenges facing a new Department of Homeland Security, which will be cobbled together from 22 different federal entities, each with their own historical role and professional expertise. On the upside, the new department will have an important prerequisite for a establishing a strong corporate culture-the clear and unassailable mission of preventing terrorist attacks on U.S. soil. On the downside, it won't have the luxury of time to assimilate the cultures of its agencies. Based on the experience of private sector mergers, "the new department will face enormous problems," says Ralph Biggadike, a professor of management at Columbia University. "To think that a structural solution can bring about a major improvement in performance is a major mistake. Fixing the structure alone isn't enough to get at the culture." The huge new Homeland Security Department is emerging at a moment when the corporate world has begun to shy away from complicated conglomerations. In the 1970s, corporations began buying up related and unrelated businesses and putting them under one umbrella, hoping to hedge the parent company's financial bets or promote "synergy" among similar types of enterprises. But many management thinkers are now critical of this approach, citing the difficulty of creating coherent corporate cultures in such huge operations. The stock market's slide and the implosion of such conglomerates as Enron and Tyco International have contributed to the skepticism. One consistent problem with bringing together an array of entities under one roof, says Princeton University sociologist Frank Dobbin, is that it's hard to find leaders with experience in all of the relevant operational areas. If a company or a Cabinet department is forced to hire executives without hands-on experience in all of its fields, the executives will be dependent on subordinates. That is a recipe for "a holding company, not a department," says Dobbin, who has studied organizational behavior in both government and the private sector. On top of that, "employees often have existing loyalties to the old chain of command, and it's hard to get people to switch over," he says, adding that creating a truly integrated corporate culture, "can take 10-15 years-enough time for a large portion of the workforce to turn over." Many of the merged companies that have created strong, unified cultures-such as Cisco Systems following several targeted acquisitions, and Chase Manhattan Bank after its 1996 merger with Chemical Bank-have worked extraordinarily hard at it, Biggadike says. Such companies typically set up post-merger committees to ensure that the acquired company becomes fully integrated within its new parent. Reorganizations have worked before in the federal government. When Congress created the Transportation Department in 1966, the new entity was up and running by mid-1967, recalls Alan Dean, a senior fellow at the National Academy of Public Administration, who served as assistant secretary for administration during Transportation's first four years. Dean says that in addition to setting up an organizational structure, lines of authority, staffing and clear missions, executives are well-advised to focus on smaller things, too. "We made a great point of having a complete and accurate phone book on people's desks," Dean recalls. "We also made sure to have a messenger and routing system in place early on. These things sound very mundane, but things won't work without them." The leaders of the Department of Homeland Security will have to be careful not to get bogged down in tasks such as reconciling its agencies' diverse personnel and procurement systems, says Patricia McGinnis, president and CEO of the Council for Excellence in Government. "In this case, speed is extremely important," she says. "It's not that you want to do the wrong thing, but by definition, there's a tremendous sense of urgency to get this done. That means not striving for absolute perfection."
Merging cultures of homeland security agencies will be big challenge