Hershey and bittersweet lessons about the value of building a culture

The Hershey Company is a legendary name in American business. Best known for its chocolate bars and candy kisses, Hershey is also a compelling case study in how organizational culture can drive success—or derail it. The company’s rich history provides both inspiration and cautionary lessons for modern business leaders. From its philanthropic roots to its more turbulent periods of labor unrest and strategic missteps, Hershey teaches us that culture isn’t just an HR buzzword—it’s a powerful force that shapes outcomes.

The Sweet Foundation: A Culture of Purpose

Hershey's story begins with its founder, Milton S. Hershey, a visionary not only in chocolate but in human dignity. In the early 1900s, he didn’t just build a factory—he built a town. Hershey, Pennsylvania, was designed to provide workers with housing, education, and recreation, a revolutionary idea at the time.

Milton Hershey’s decision to fund the Milton Hershey School, a private philanthropic institution for disadvantaged children, solidified the company's identity as one rooted in purpose. Even today, the Hershey Trust Company holds a controlling interest in Hershey and supports the school. This enduring structure is a testament to how deeply values can be embedded in organizational DNA.

Lesson: Purpose-driven culture isn't a trend—it's a long-term competitive advantage. When employees believe in something bigger than profits, they perform better, stay longer, and become brand ambassadors.

Bittersweet Realities: Cultural Disconnects and Labor Tensions

Despite its rosy beginnings, Hershey’s culture hasn’t always been harmonious. The 2002 labor strike at its manufacturing plant marked a turning point. Workers, many of whom were proud of the company’s legacy, protested against job cuts and outsourcing—feeling betrayed by what they saw as a shift from the founder’s values.

At the heart of the unrest was a growing gap between executive decision-making and employee experience. As Hershey modernized and globalized, the humanistic culture that once defined it began to erode under the pressure of shareholder demands and corporate restructuring.

Cautionary Tale: Legacy and goodwill can erode quickly if leadership fails to evolve culture alongside strategy. Employees need to feel they are still part of the story—not collateral damage to it.

Global Growth, Cultural Friction

Hershey’s international expansion also posed cultural challenges. In markets like China and India, the company struggled to adapt to local tastes and consumer behaviors. Critics pointed to a rigid corporate culture that valued "American" branding over cultural flexibility.

Cautionary Tale: A strong culture can become a liability when it turns into insularity. Companies expanding globally must embrace cultural agility—not just brand consistency.

A Return to Values-Driven Culture

In recent years, Hershey has worked to reclaim its values-driven identity. Under the leadership of CEO Michele Buck, the company has invested heavily in sustainability, DEI (diversity, equity, and inclusion) initiatives, and employee well-being. Its inclusion in rankings like Forbes' "World’s Most Female-Friendly Companies" reflects a renewed focus on aligning internal culture with modern stakeholder expectations.

Lesson: Culture is not fixed. With the right leadership and intention, it can be revitalized to meet contemporary needs without losing its core identity.

Key Takeaways for Leaders

1. Founder's Values Matter – Hershey’s success was grounded in a powerful origin story. Know your “why,” and communicate it often.

2. Culture Must Evolve With Strategy – Don’t let legacy culture stall necessary innovation. But also don’t let efficiency destroy empathy.

3. Employees Are Cultural Barometers – When they start disengaging or resisting, it’s often a sign that culture and leadership are out of sync.

4. Global Growth Demands Cultural Flexibility – What works in Pennsylvania may not translate in Mumbai or Shanghai. Listen and localize.

5. Culture Can Be Rebuilt – It's never too late to course-correct. With authentic leadership and sustained commitment, cultural renewal is possible.

Conclusion

Hershey is a case study in the power—and pitfalls—of organizational culture. It shows how a strong, purpose-driven foundation can fuel long-term success, and how neglecting that culture can lead to disillusionment and division. But perhaps most importantly, Hershey’s ongoing evolution proves that culture is not static. It's a living, breathing element of business strategy—one that, when nurtured wisely, can create both sweet results and lasting legacy.