Founded in 2011, THINX is the world’s firstmanufacturer of the period panty, committed to the social mission of women’sempowerment. In 2017, the organization made international headlines on accountof its toxic leadership and workplace culture (THINX, 2018; Tokumitsu, 2017). Thepurpose of this essay is to assess the effectiveness of this socially-focusedorganization through an analysis of its leadership and culture.  The paper is organized as follows: First, thesocial organization shall be introduced and a commitment to its social mission,explained. Second the organization’s corporate culture and leadership issuesshall be described. Third, the relevant organizational behavior theories shallbe explained. Following this, THINX’s corporate culture and leadership will beassessed in accordance with the presented theories.

The paper shall concludewith a list of recommendations for THINX to improve its organizationalleadership and culture.  THINX revolutionized the femininehygiene industry with the creation of the period panty. The companymanufactures antibacterial, highly permeable, washable, organic periodunderwear (THINX, 2018;Tokumitsu, 2017). Since its launch, the brand has received internationalmedia attention for its commitment to social change for women (THINX, 2018).

  THINX seeks to further its social mission inthree main ways. First, THINX’s revolutionary product provides a healthy andenvironmental friendly alternative for women (THINX, 2018; Johnson, 2015).Second, through its marketing and advertisement strategy, the company seeks tobreak the taboo about publicly speaking about menstruation (Coughlin, 2015).Third, to further its espoused values of accessibility for all, theorganization donates a portion of its profits to AFRIPads, a social enterprisethat provides low-cost reusable pads to low-income women in Kampala, Uganda (THINX,2018).  THINX recently made headlines for toxicorganizational leadership and corporate culture, contradicting these values(George-Parkin, 2017; Tokumitsu, 2017). The next section will explain relevantorganizational behavioral theories. THINX’s corporate culture and leadershipwill be assessed in accordance with these theories. LEADERSHIP – THEORY The organization’s leadershipstyle shall be analyzed based on transformational and transactional leadershiplenses.

The foundational elements of the transformational-transactionalleadership theory were first coined by Burns (1978, as cited in Judge andPiccolo, 2004). He stated that transactionalleaders incentivize followers to complete certain responsibilities or tasks, inexchange for a specific, object or reward. Transactional leaders are task-basedand seek to work within the organization’s existing structure and culture. Transformationalleaders seek to psychologically empower their followers, beyond the specificresponsibility or task at hand. Bass (1985, cited in Bass and Avolio, 1993)stated that a transformational leadership style motivates employees to lookbeyond short-term goals, towards the higher purpose of the organization. Avolio,Waldman and Yammarino (1991) proposed four main characteristics oftransformational leadership:  1)    Idealized influence refers toincumbents being moved and inspired by the qualities and characteristics of theleader.

This results in followers often looking up to the leader, and seeingthem as a role model. 2)    Inspirational motivation refers tothe ability of the leader to create a mission and vision inspiring itsfollowers towards achieving that mission and vision. 3)    Intellectual stimulation refers tothe ability of the leader to challenge the status quo and the traditional wayof doing things. In this respect, the leader is able to inspire and motivatethe team to think of innovative and novel approaches to address problems anddevise solutions. 4)    Individualized considerationrefers to the ability of the leader to cultivate, nurture and grow the skillsetof each individual follower.  LEADERSHIP – ANALYSIS Chief Executive Officer, Miki Agrawal failed todisplay the four critical characteristics of a transformational leader. She wasunsuccessful in empowering her employees through idealized influence (Avolio,Waldman and Yammarino, 1991).

Her employees did not see her as a role model,and did not have respect for her. Reviews by former employees on the Glassdoorwebsite stated that Miki Agrawal was a “bully”, “a time bomb and a liability”,a “loose cannon” (cited in George-Parkin, 2017; Malone, 2017).  In terms of inspirational motivation, it mustbe acknowledged that Miki Agrawal was able to build a company with a strongsocially-focused mission and vision that inspired both customers and employeesalike. Even former employees that spoke out against Agrawal, said that theywere still inspired and committed to furthering the mission and vision of thecompany (Avolio, Waldman and Yammarino, 1991; Malone, 2017).  Miki created a corporate culture where intellectualstimulation was frowned upon. Employees felt uncomfortable introducing newideas, and viewpoints that differed from that of the leaders (Avolio, Waldmanand Yammarino, 1991).

There were instances where the team proposed differentbranding visions for the company, and Miki threatened to have them fired if theemployees did not follow her plan. When the team suggested a new line ofproducts for plus size women, Miki mocked the idea with fat-shaming comments (Malone,2017).   Employees were not given individualized considerationby Miki. The CEO failed to establish a relationship and connection with each individualemployee and failed to empower them on a personal level (Avolio, Waldman andYammarino, 1991).

Instead, Miki appointed two Culture Queens who were availablefor employees to speak about grievances. The appointment of Culture Queensprevented Miki from establishing a personalized relationship with each employeein the start-up (Malone, 2017).  Miki Agrawal displayed many elements oftransactional leadership. According to Bass (1985, as cited in Yildirim andBircini, 2014) transactional leaders use methods to gain control over followersand require them to perform tasks, to attain short-term objectives. In thisrespect, Miki Agrawal displayed elements of transactional leadership as shefrequently threatened employees over their jobs and a reduction in salary, toachieve her personal objectives for the organization.

This only resulted inshort-term successes (Malone, 2017). Through a predominantly transactionalleadership strategy, Miki Agrawal created a toxic workplace environment for heremployees.  ORGANIZATIONAL CULTURE– THEORY  Schein (2010) describes organizational cultureas a group of people that come together and realize a collective set of ideas,beliefs and values over the course of time spent together. These ideas, beliefsand values are then relayed to new recruits.  Schein (2010) states that there are three layersto Culture:  1)   Artifactsare elements of a culture that can be recognized asbelonging to a specified group. These elements are visibly seen, heard or felt.Some examples include, common language used, symbols, the organization’s logo,office behavior.

2)   Espousedvalues and beliefs are first proposed by one individual in the group,often when groups first form. This idea is usually proposed by someoneinfluential in the group such as leader or executive. Once the group decidesthat that the idea is worth accepting, then the idea gains status as an beliefof the group. After continuous implementation, it is possible for this newbelief to become a basic underlying assumption of the organization. 3)   Basicunderlying assumptions refers to those notions and beliefs held that arecommonly ingrained within a group that the group perceives these to be a commonunderstanding.

Any deviation from these basic assumptions are inconceivable tothe group.  ORGANIZATIONAL CULTURE- ANALYSIS When analyzing THINX in accordance with Schein’s(1992) three layers of organizational culture, it becomes evident that there isa disconnect between artifacts, espoused values and beliefs, and basicunderlying assumptions. The organization’s artifacts, such as the logo, taboo-breakingadvertisements and the design of its website, display a message of women’sempowerment (THINX, 2018). Internally, however, THINX struggles with clearlyidentifying its espoused values and beliefs. Miki tried to introduce her ownideas of women’s empowerment, and progressive culture into the organization.For example, during work meetings, it became commonplace for Miki to speakabout her sexual experiences publicly. She would also change her clothes infront of her employees (Malone, 2017). This was a display of Miki’s personalviews of women’s empowerment, and she tried to introduce these ideas into thegroup.

The group, however, rejected these ideas. The leader had a differentvision of what she wanted to implement as the organization’s core espousedvalues and beliefs, and what the group was comfortable with. This disconnectbetween the leader’s vision, and that of its team members, resulted in a misalignmentin the organization’s display of artifacts, espoused values and beliefs, andunderlying assumptions (Malone, 2017; Schein, 1992). PSYCHOLOGICAL CONTRACT- THEORY  Rousseau (1989) defines a psychological contractas an implied obligation of reciprocal exchange between two parties. Apsychological contract is formed when at least one of the two individuals supposesthat there is an obligation to return the favor when given an object, whethertangible or intangible. Blau (1964, as cited in Thompson and Bunderson,2003) identified that psychological contracts are composed of two forms ofcurrencies; economic and socioemotional. Thompson and Bunderson (2003) proposedideology as a third form of currency. Economic currency refers to a transactionalrelationship in which the employee is compensated through monetary means by theemployer.

Terms of obligations are often specific, quantifiable and based on equaland reciprocal exchange. Socioemotional currency is an element of psychologicalcontracts based on relationships. In exchange for the completion of specifictasks, employees expect to be accepted into an identifiable organizationalcommunity.  Employees that findthemselves in this type of psychological contract are often expecting socialacceptance (Blau as cited in Thompson and Bunderson, 2003). Ideological currencyis founded on a commitment to a cause. Employees in this type of contract areoften driven by intrinsic motivation and internal satisfaction from assistingthe organization in achieving a specified cause.

(Thompson and Bunderson,2003).  PSYCHOLOGICAL CONTRACT– ANALYSIS The form of currency that governed anddominated most employee psychological contracts at THINX was ideologicalcurrency (Thompson and Bunderson, 2003). Despite the firm being a highlyprofitable start-up, employees were significantly underpaid in comparison toindustry standards. Employees within the organization also stated that MikiAggarwal created a hostile work environment, and would commonly “pit peopleagainst each other”.

Despite this toxic work environment, employees still choseto stay because of their commitment to the vision and mission of women’sempowerment. When an employee was asked why she didn’t leave earlier,she responded “I struggled a lot with the weight of what I was doing. I lovedthe mission of the company…

” (Malone, 2017). Miki Agrawal created imbalancedpsychological contracts by exploiting ideological currency of her employees (Malone, 2017; Thompson andBunderson, 2003). RECCOMENDATIONS                Figure 1. Proposed recommendation for THINXTHINX isexperiencing a breakdown in its organizational culture. Bass and Aviolo (1993)state that a strong organizational culture provides clarity, confidence,certainty and a sense of purpose for employees. Currently, employees arereceiving mixed signals about the organization’s culture due to its leadership,weak beliefs and values, and the existing psychological contracts.

As shown inFigure 1.0, the main goal of the three recommendations provided is to establisha strong organizational culture.  RECCOMENDATION ONE: RECRUITTRANSFORMATIONAL LEADERSHIP Bass and Aviolo (1993) state transformationalleaders have the capacity to shape transformative organizational cultures, byempowering followers and creating a collective vision. In line with thisrevelation, the first step that THINX needs to take, is to recruit atransformational leader to drive its organization.

Selecting a transformationalleader will ensure a cohesive and healthy organizational culture is establishedfor its employees.  RECCOMENDATION TWO:BUILD ESPOUSED BELIEFS, VALUES AND SHARED ASSUMPTIONS Transformational leadership is an importantelement that will help THINX in building espoused beliefs and values, andassumptions that are in alignment with the organization’s artifacts. Inaddition to this, transformational leadership will ensure that employees areincluded in building espoused beliefs and values, that will then, throughsocial acceptance turn into shared basic assumptions the organization holds(Schein, 1992; Burns cited in Judge and Piccolo, 2004). It is recommended thatthe newly recruited transformational leader holds a summit with all employees,to build a collective understanding of the organization’s beliefs and values.  RECCOMENDATIONTHREE:  DEVELOP BALANCED PSYCHOLOGICALCONTRACTS WITH EMPLOYEES After establishing transformational leadership,and three layers of organizational culture that are now in alignment, THINXwill now be in an exceptional position to develop effective, fair and balancedpsychological contracts with its employees.

Under previous leadership, THINXcreated a toxic work environment for its employees by heavily exploitingideological currency (Thompson and Bunderson, 2003). Given that theorganization now has a transformational leader, an aligned three layers ofculture, the next logical step is to create psychological contracts thatbalance economic, socioemotional and ideological currency.  There are a number of concrete steps that THINXcan take in establishing balanced psychological contracts. First, THINX canbegin with paying employee’s competitive wages, resulting in a strong economiccurrency. THINX can also hold team building activities resulting in a strongsocioemotional currency (Blau cited in Thompson and Bunderson, 2003). Third,THINX can allocate time periodically, where employees take on passion projects,allowing employees to contribute to the organization in more than one way,resulting in a healthy use of ideological currency.

By creating psychologicalcontracts with balanced currencies, THINX will finally be able to contribute toestablishing a strong organizational culture (Thompson and Bunderson, 2003).