CEO Says Workplace Culture Can Set a Company Apart

Scott Kirchner believes that, as a technology company, Panasonic Automotive Systems of America doesn’t distinguish itself from other tech companies based on any systems or products it might produce.

To really stand alone, Kirchner knows, Panasonic has to rely on two things: Its people, and its culture. And, as president of Panasonic Automotive Systems, Kirchner believes his company does both.

“It boils down to our cultural model … Our vision, our mission, our principles and our behaviors,” Kirchner said. “It’s founded on a culture of accountability, a safe place for everyone to be themselves, to contribute maximally their own capabilities and skills to our mission and vision, treat everyone with respect. Those are the foundations of it.

“(Technology and product) can be copied very quickly.” He added. “We differentiate ourselves by our people. It’s the only competitive, sustainable advantage we think we have in the market. The foundation is our cultural model, our vision and mission, our principles and our behaviors. We believe in it 110%.”
Panasonic Automotive Systems is a Tier-1 automotive company, making automotive electronics for various automakers, such as Toyota, Honda, Ford and Stellantis.

“The best way to describe it is, if you’ve driven a car, or ridden in a car, you probably have electronics that we’ve done,” Kirchner said.

Kirchner sat down to talk about Panasonic Automotive Systems and the challenges of navigating the business climate during the most recent episode of “CEO Thought Leadership Series on LinkedIn Live,” the discussion series hosted by the National Association of Business Resources.

Produced in conjunction with the Best and Brightest Companies to Work for and Corp! Magazine, the series is hosted by NABR CEO Jennifer Kluge and features business leaders from around the country.

Jennifer Kluge: Give us some examples of some … best practices that keep (employees) engaged.
Scott Kirchner: Once you’ve got your culture well defined, you’ve communicated it and you’ve got the right environment where you hold people accountable to living by it, those rituals are important in how you sustain it.

Fundamentally, we try to integrate (culture) into everything we do. Every meeting we have … it always starts talking about the culture. We always talk about how that cultural model has helped us … and how we focus on it going forward.

We integrate it into al our communications, we integrate it into our performance discussions … you notice I didn’t say performance appraisals; we got rid of the idea of scoring people.

We integrate it into our affinity groups — we have business impact groups, RISE, a women’s group, a Black employee network, an LGBTQ group, a DEI advisory council – and in all of those it starts with our culture of creating safe places where people can gather to talk about where there are challenges, where we can do better.

We do an employee opinion survey every year, and we take it very seriously. We analyze that to see where we have improvements or weaknesses, where it’s working or not working.

That’s important. Don’t get feedback and then sit in your office and create a plan and execute it. Go out and talk to your people about what you heard and what you’re going to do about it, so they can hold you accountable.

Kluge: We’ve been telling (companies) for about 10 years to get rid of their employee reviews. They don’t work; supervisors hate them, employees hate them.
Kirchner: We don’t like talking about people as numbers. We like to focus performance discussions about the conversation, the connection the manager makes with the people, understanding where they’re having difficulties, or giving them feedback … and in those discussions the cultural model is integrated. We talk about our values and our principals and our behaviors in those performance discussions.

Kluge: The last three years have been challenging for many industries, many businesses. I’m curious how your culture helped you during that time. What set you apart? What lessons learned do you have from the last three years?
Kirchner: When you get into times of crisis, which everybody went through, from the pandemic, maybe automotive is special that kind of after the pandemic shutdown crisis, we went through the supply chain crisis, the semi-conductor crisis … we’ve been through about three straight years of industry crisis.
When you get into crisis, you really think about whether you and your people believe in the cultural model and whether it’s ingrained in your fabric or not. We were pleased to find out the answer was ‘yes’ to both of those.

We went through what everybody else did in early 2020. The industry went from hot to nothing overnight. Our sales went from a couple hundred million a month to zero. The plant shut down, everybody had to go home, we had to think through how to keep our people safe.

I think the amazing thing for me is, going home and going to this digital world had some strange impact of knocking down what were these residual barriers of cross-functional communication that we didn’t even know we had.

For some reason being in this virtual world and reaching out to somebody that’s in another location all of a sudden became just as easy as talking to your neighbor. The coordination and cross-functional communication improved, and I would have never guessed that.

We set three priorities: 1) protect the people; 2) protect the customer; 3) protect the business. We believed if we did the first two, the third one would come naturally. I’m really glad to see every leader, every employee operated on those three priorities.

The lesson I would share with everyone else is, build the culture before you need it. If we had gotten into that crisis mode without the five years of investment, we would have struggled. But we actually came through it … I’m incredibly grateful and proud of what everyone in the company did during that time period.

Kluge: Lets say you write a book aimed toward young people who want to start a business, or get into the executive suite. What would be some of the chapters in that book?
Kirchner: I had some suggestions from my staff. One was “Shut Up and Listen,” and the subtitle might be “Do as I say, not as I do.’ I have to talk to think, which can be dangerous in my position. I’m just brainstorming, and people start to take actions (laughs).

Another one might be “Good leadership is good questions, not good answers.” Your people don’t need to hear you tell them what to do; they need you to help them figure out what to do so they can learn and contribute.

Another one is “Talent and culture is your only sustainable advantage.” “The road to trust is authenticity and transparency.” We believe in this radical transparency and authenticity. We want people to be who they are, and we are very transparent. We share everything we possibly can … that enables them to contribute.

One of my favorite sayings is, “the more power you have the less you can use it.” If you’re leading from your positional power, you’re failing,

Kluge: Do you have a standard question you ask to get people thinking?
Kirchner: One of my go-to questions is, “why do you think that?” I want to hear not just what you think but I want to understand your thought process of how you got there. If someone is pitching something to me, or explaining how to solve a problem, I really don’t want to understand just what they think is the problem and solution, I want to understand how they got there.

That’s another question I ask is, “what other options did you consider and why do you think this is the best one?”

You have to realize that 99.9% of the time, your people know more than you do. Your job isn’t to outthink them, your job is to help them to be sure they went through the right process. If you disagree, let them make what you might feel is a mistake. They’ll learn from it, but often you find out it’s not a mistake. Ownership of the idea and the solution is probably 50% of success.

Kluge: Wellness has been a big issue, especially in the last three years. What do you do for managing stress and taking care of yourself?
Kirchner: I’m a big believer in mindfulness meditation. I wish I could say that was one of my daily rituals, but it’s probably only about 50% of the time that I do it pre-emptively. If I feel stress, I’ll stop and meditate for five or 10 minutes.

Kluge: What do you do for fun?
Kirchner: I like to play golf. I’m not good at it, so I just play for fun. I like to pretend I’m still an engineer … so I have a little electronics lab, I’ve built drones, I still write software to pretend I’m a software engineer. I’m kind of nerdy, but I enjoy it. I like to play games with my family.