WHAT IS MORE IMPORTANT: STRATEGY OR ORGANIZATIONAL CULTURE
“Culture eats strategy for breakfast” is a phrase from Peter Drucker made famous by Mark Fields, President at Ford. It has become an absolute reality! Any company today that disconnects the two is putting its success at risk.
However, while many studies show a direct correlation between a healthy, productive culture and a company’s bottom line, most companies spend little time thinking, let alone doing anything about, this topic — even when they spend lots of time thinking about their business strategy.
MY RECOMMENDATION IS THAT STRATEGY, CAPABILITIES, AND CULTURE NEED TO BE ALIGNED
This is a powerful trio in corporate change and transformations. Strategy, capabilities, and culture are distinct yet interdependent in every company. All three must be designed together, aligned, and enabling each other to create vibrant organizational transformation.
Strategy, capabilities, and culture leadership involve a series of related choices about “what market we are going to operate in,” “how are we going to win and differentiate,” “what capabilities need to be in place to execute,” and “what are the cultural imperatives to enable differentiation and execution.”
Usually, strategy is reviewed every 3–5 years and refreshed at that point. This also means that capabilities and culture should be examined simultaneously as ONE process.
This does not mean changing the company’s values; it does mean changes in the context of the strategy, business model, brand positioning, capabilities required, and critical cultural capabilities are necessary to enable and drive success.
Corporate culture is a difficult thing to get right. It’s a dynamic, moving target that means something different to everyone. It grows and evolves and is the result of action and reaction. It is also the sum of the effects of every past interaction.
ALWAYS REVIEW CULTURE WHEN DRAFTING CORPORATE STRATEGIES
Cultural change is highly complex, and many, if not most, efforts fail to meet expectations. Too often, it is approached separately from strategy and capabilities and becomes an “HR Thing” if approached too broadly.
Culture eats strategy for breakfast … unfortunately, it is a message often forgotten when drafting corporate strategy.
“The thing I have learned at IBM is that culture is everything,” said Louis V. Gerstner, Jr., former CEO of IBM.
IT IS NOT STRATEGY OR CULTURE
Ensuring cultural UNITY across a company’s divisions and silos should be an essential factor when determining a corporate strategy.
No culture, however strong, can counteract poor corporate strategy choices. A company’s culture impacts its success only, not its sound strategy.
Takeaway: Drucker and Fields’ message is simple: “Don’t let culture eat strategy for breakfast. Have them nurture each other.” Ensure you have open, transparent communications around the change process, which will affect strategy, capabilities, and culture.
Incorporate input from all levels to ensure no one’s voice is ignored or lost in translation. I understand you can’t please everyone, but with solid, complete, compassionate communications, you can have the greatest possibility of a successful transformation.
Leadership Questions: How does your company culture support the alignment of communications, strategy, and tactics while basing decisions on the values and trust of the people?
