How Subaru Shaped it’s Culture

Subaru of America President and CEO Thomas J. Doll led the company through the 2008–2009 financial crisis to 12 years of growth at a time when the auto industry faced significant challenges. He did this by modeling the characteristics in Hogan’s recent research showing the link between humility and strong leadership: remain open-minded, do not self-promote or seek the spotlight, and focus on getting along with others over personal gain. See: Humility: The Antidote for Bad Leadership.

Doll and his leadership team have placed a heavy focus on customer service, staff welfare, and giving back, as evidenced in the Subaru Love Promise, which is deeply embedded in the company’s culture: “More than a car company: The Subaru Love Promise is our vision to show love and respect to all people at every interaction with Subaru. Together with our retailers, we are dedicated to making the world a better place.” Subaru has donated more than $176 million since 2008, including notable charitable contributions to the environment, health, hunger, education, and animal welfare. Doll also quickly championed the donation of 50 million meals through Feeding America in response to the COVID-19 pandemic.

Making Culture a Statement

This leadership style does not come without its challenges. Doll was originally overlooked for the top job at Subaru. After serving as the automaker’s CFO, he eventually did land the CEO role, given the company’s need for someone with strong financial acumen and deep knowledge of the company and industry. But that was not all it took for him to secure early wins. Doll’s first bold move as CEO was to create a new statement about the culture with a focus on unmatched customer service and a positive experience for employees, retailers, external partners, and the community, which over time became deeply embedded within the company.

In 2017, Doll was proud of Subaru’s success, culture of being a nice place to work, and low attrition. However, he felt the company could accomplish more with the right level of structure and a focus on accountability and feedback. He needed a new CHRO and went outside of the company to hire Peggy Verdi. According to Verdi, their efforts focused on “beginning a multiyear journey to increase employees’ skills and comfort with having difficult conversations, as well as driving accountability.” Verdi said, “It is a major shift, and we needed to change but also protect the core Subaru culture of humility because that’s what has made — and will continue to make — us successful.”

Shifting Gears

Their work focused on employees having individual goals tied to company priorities. In the past, other than sales targets, goals were not consistently set at the beginning of the year. As a result, the focus turned toward training managers and employees on how to give constructive feedback in reviews and now have distributed performance ratings. When performance reviews were given previously, nearly everyone was rated as exceeding expectations or exceptional, and a large portion of people were high potential. Doll and Verdi went a step further with the executive management team, providing Hogan assessments and coaching for each individual leader and at the team level.

Finally, the company revamped its leadership competencies to focus on the behaviors needed for future success, such as Fueling the Business, Driving Results and Accelerating Change, Engaging People, Diagnosing Self and Shifting Gears, and Igniting Development and Coaching. A recent survey of all employees showed people recognise that change is underway, and a vast majority are very supportive.

Subaru is currently wrestling with how to recognise exceptional individual contributions within a culture that prefers to recognize team success. “People sometimes assume requests for recognition would come from the sales force, millennials, or the new employees we’ve hired, given our growth,” said Verdi. “But it comes from mid- and late-career professionals as well — people at every stage in their career. Employees report staying because of the altruistic mindset, despite not feeling individually recognized. The programs are there; we just need to remind managers to use them.” Verdi added, “We are starting to use individual recognition to spotlight rising stars, showcase underrepresented voices, and help attract talent, but we can’t let it get so big it no longer feels genuine at Subaru. When people aren’t modest here, they often struggle.”

Doll makes clear that being humble is not the same as not being fiercely competitive, working hard, or having a focus on the bottom line when your legacy is to make the world a better place.