Don't Let Culture Vultures Scuttle Your Strategy

Step inside any company, no matter the size, stage of development, or level of success, and the culture is either driving the strategy or undermining it.

Debate and difference of opinion, lightly salted with an appropriate amount of passion and tenacity, can help lead to significant breakthroughs. In the world of corporate correctness we are all living in, this should be highly encouraged. I really appreciated Bob Frisch's response to my recent article on the importance of culture. Though I think he missed the point, the overwhelming number of people who embraced the notion that culture is imperative for sustained success is an indication of the importance of this issue and the opportunity culture offers for positive change.

People matter. More than machinery, products, or real estate. People invent and build. People support and serve customers. Your people either create or undermine value, cultivate or kill relationships, drive or reduce success. A well-conceived strategy living in the hands of unhappy, misdirected, misinformed people is a sure way to a slow and painful death. There is no comparison to being in the hearts and hands of energized, informed, and motivated people.

Companies are not linear, inert systems. They are ever-changing, organic communities that are dependent on the engagement, talent, and energy of their people to operate successfully. Ignore the mental well-being of your people and culture at your own peril. Step inside any company, no matter the size, stage of development, or level of success, and the culture is either driving the strategy or undermining it. To exist in the first place, a company must have a clear purpose, a deliberate intent, and a set of ideas that it uses to pursue a clear goal--but it's the people who have to execute it.

There is abundant evidence in every industry that the best-laid plans (or strategies) are derailed, suffocated, or eaten by cultures that either don't understand or straight-out reject the intent. And this, in turn, slows, sucks the life out of, or sabotages the execution of the company's strategy.

For the sake of debate, let’s assume there are two kinds of companies in the world: those driven by strategy, where culture is not a priority, and those guided by a clear strategy, where culture is highly valued and universally understood. To help clarify what's important, let’s look at the relationship between culture and strategy.

Every company needs a clear strategy...really?

You don't need to be told that a company must have a clear reason for being and a plan of action. But, you might be surprised by how many companies lack strategic clarity, and whose only purpose is to make a profit. To be clear, making money is absolutely imperative, but it is just one of the outcomes of a successful company.

Competitive differentiation and optimal financial performance do not come from strategy alone. To ignore the potential of a fully engaged and mobilized culture that understands, embraces, encourages, executes, and enhances strategy is negligent and a missed opportunity. It is imperative that today's leaders not only understand and focus on the interdependence of strategy and culture, but also step back and examine their own role--it is one of the most important areas of their personal responsibility. The mental and physical health of the company in their care must be paramount for sustainable success.

Corporate culture is a hot topic among businesses who want to attract the best talent, translate their values to their products and services, and show customers what they're all about. And it doesn't cost a thing:

»Culture Isn't Costly

»Box CEO Aaron Levie: To Create Something Exceptional, Do Sweat The Small Stuff

»3 Secrets To Recruiting Tech Talent In Tough Markets

»What Happened When UC Berkeley's B-School Cherry-Picked Students Who Personify Its Values

»Creative Cultures On Co.Create

Strategy is rational and culture is emotional.

Strategy, at its core, is rational and logical, clear and simple. It should be easy to comprehend and to talk about. Without a clear strategy, a company is lost. Culture, on the other hand, means different things to different people. It is emotional, ever-changing, and complex. Culture is human, vulnerable, and as moody as the people who define it. It can be intimidating and frustrating, often leaving leaders dodging it, neglecting it, or discounting it. Because so many large companies are run by people whose expertise is heavily skewed to the rational, financial, and legal side of the equation, culture is often subordinated, misunderstood, or underappreciated.

Every company has a culture, but not every culture is healthy.

Culture is the environment in which the intent of your company is nurtured, fueled, restricted, or suffocated. Every company has a culture and its health should be monitored and cared for. Cultures reach their full potential when the people in the trenches doing the day-to-day hard work understand the game and are fully informed and engaged. Healthy cultures are directed, purposeful, vibrant, optimistic, and highly-successful because they are fueled by the company's larger purpose and supported by the capability to follow through. A company with a healthy culture is able to operate at its fullest potential while one with an unhealthy culture operates far from its best.

Visionary leaders are required for successful culture.

Like a great coach, a leader’s job is to clearly set the intent for the journey, model the correct behaviors, lead with an understood set of values, communicate clearly and with sincerity, and set clear expectations and guardrails for the culture to thrive. It's the team's job to bring their best game every day and to execute the game plan to the very best of their ability. Like any great sports team, a culture is built by motivation, communication, training, encouragement, and celebrating both small and significant successes.

Culture is the field on which the strategy plays. A vibrant and functional culture is like a blanket that embraces, protects, and nurtures the strategy. A company without a strategy lacks direction. A strategy without a culture that understands or embraces it is like a sports team without spirit.

Understanding the relationship between culture and strategy.

1. Strategy drives focus and direction while culture is the emotional, organic habitat in which a company's strategy lives or dies.

2. Strategy is just the headline on the company's story--culture needs a clearly understood common language to embrace and tell the story that includes mission, vision, values, and clear expectations.

3. Strategy is about intent and ingenuity and culture determines and measures desire, engagement, and execution.

4. Strategy lays down the rules for playing the game, and culture fuels the spirit for how the game will be played.

5. Strategy is imperative for differentiation, but a vibrant culture delivers the strategic advantage.

6. Culture is built or eroded every day. How you climb the hill and whether it's painful, fun, positive, or negative defines the journey.

7. When culture embraces strategy, execution is scalable, repeatable, and sustainable.

8. Culture is a clear competitive advantage.

9. Culture must be monitored to understand the health and engagement of your organization.

10. Strategy and culture both require the clarity and power of brand to bring them seamlessly together.

Shawn Parr is the The Guvner & CEO of Bulldog Drummond, an innovation and design consultancy headquartered in San Diego whose clients and partners have included Starbucks, Diageo, Jack in the Box, Adidas, MTV, Nestle, Pinkberry, American Eagle Outfitters, IDEO, Virgin, Disney, Nike, Mattel, Heineken, Annie's Homegrown, The Michael J. Fox Foundation for Parkinson's Research, CleanWell, The Honest Kitchen, and World Vision. Follow the conversation at @BULLDOGDRUMMOND.

[Image: Flickr user certifiable.nl]

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15 Comments

  • Carl Lachmann

    Great article. BUT - one thing I do not agree with, and one angle that needs extending
    "Visionary leaders are required for successful culture." I disagree. Culture is something we DO, the HOW we do what we do when we do it. So long as there is clarity of purpose, and actionable items that gets done, you can ensure that you get a culture that helps drive strategies and results. You need people who can lead, and you need people who can manage. Do they have to be visionary? Not sure.

    The article is clear on WHAT it is that needs to be understood, and WHY it is so important. I have spent the last years trying to help companies, schools and organizations become places that deserve the full commitment of the people that work there. When it comes to driving improvements and change, the problem many have is to get to actions, to formulate HOW the will work, what actions they will take, to implement change.

  • Michael Smith

    Agree, long past do and this full article should be allowed to be re-posted and evangelized throughout cyberspace.

  • Ajram

    Great article bringing out the relationship between culture and corporate strategy . corporate culture creates a framework for corporate governance and an ever evolving strategy .Just read an informative whitepaper ' Corporate culture - Creating guardrails against unacceptable behavior ' @ https://bitly.com/A6mEjA

  • Don Mercer

    One of the best brief articles on culture I have seen.  To enhance, repair or create an organizational culture that will give more power to the strategy and build the competitive edge I work with organizations to add a new cultural foundational element.  In 'Follow to Lead' (www.follow-to-lead.com) we lay out 7 principles that will create the Followership Culture that applies to everyone in the organizatin.  More than a set of values, it is an action plan any organization can implement.

    Why a Followership Culture?  Because there is such an emphasis--too much I would argue in the majority of cases--on leadership development and education, the other 99% of the people who are followers are not given sufficient attention.  Follow to Lead is a guide for educating everone in the principles and adopting it as part of the formal culture of the organization which will impact the informal cultures present in all organizations.  In other words, implementation will accomplish much of what is written above in the article.

    How do you lead in a Followership Culture?  All that is in the book.  Here is one thought provoker you may have seen elsewhere: Leaders are wasting their time trying to motivate followers.  Followers must be inspired and leaders should not be chariamatic to do it.  It is easily learned even by the most withdrawn leader.

    If you want to enhance your culture, get the book and use it.  It is brief, just the nuggets and contains implementation instructions.  Did I mention you can get it for under $10 at Amazon?

    Great leaders are precious; great followers, priceless.

  • KBlack

    Oh, the irony!  If businesses only knew the history of military strategy.  This is SAME argument that has had military theorists debating for over two centuries.  Parr is arguing the romanticist view (also counter-Enlightenment) that some things are beyond measurement or objective understanding, i.e. passion, culture, feelings, etc. Read Clausewitz and you'll see the intellectual roots of this argument. 

  • Michelle Pokorny

    So appreciate this article. I believe leaders today need to consider themselves designers of social systems as much as authors of business strategies.  Cultures are created by the human element - perhaps the last remaining, sustainable differentiator in business.  Strategy means little if you never gain emotional commitment.  Employees have to both clearly know, trust in, experience and contribute to what the company wants to be - or strategy will just be another file in the 3YP folder!

  • Art

    Thank you for an excellent article. People have to find satisfaction in the things they have to do and the strategy to get there. I have been a strong proponent for believing that if you look after your people that the profits will follow, I believe that is the Enterprise Car Rental way. A strong culture of respect will dictate that you must communicate, motivate, train, encourage, and celebrate. Thanks for reminding me of the importance of that and the need for the leaders of the company to take seriously the responsibility of looking after both the mental and physical aspects of the company.

  • Dianne Crampton

    I agree. Good article. And, punctuating that culture is the emotional aspect of a company is important for leaders to recognizee. What it feels like to work in a company is often more important to an employee than achieving goals. Because goal achievement is emotionally fueled.

    Onboarding into culture is also important and those who do it well will not experience the job fit retention issues that Gallup recently posted.

  • David Huggins

    Agreed! An excellent article which very clearly describes the interdependencies of strategy and culture. What may not be obvious to those who are attempting to reconcile the two is that culture has to be changed from the inside-out; it cannot be imposed (as strategy often is); it originates within each individual and within the collective. 
    Ideally developing strategy should be a communal responsibility in its formulation and approved / endorsed by owners. Culture can be developed by every member of staff, given a clear description of the strategic intent, by the identification and reinforcement of role models (heroes), teaching stories (myths), practices (rituals) and channels (networks). When these are coherent in the context of strategic intent then trust escalates within the organization and business success follows.

  • Al Watts

    'Good points, Shawn. "Culture happens" - good or bad, whether intentionally cultivated or just the way things turned out; clearly it's better to be intentional about it.  Another reason that it doesn't work to think of strategy independently from culture, is that prevailing culture will dictate the realism of strategic plans - just as prevailing winds or currents affect an intended sailing course. Some cultures are so ingrained but counter to what makes strategic sense, that execution is unrealistic. As an example consider the polarized partisan culture of our U.S. senate and the near impossibility of actually getting things done.

  • Janice Mayo

    Shawn, it's been too long!  A thought-provoking article that is spot-on in identifying why some succeed and others don't. it never ceases to amaze me how companies - from early stage to end-stage, behemoth to beginners - turn a blind eye to culture and believe their blindingly brilliant strategy is the only way to win. Your 10 points should be required reading for any company that thinks a new strategy will save them.

  • leslie gadman

    For those of you thinking that this is stating the blindingly obvious, think again. There are too many examples of "donkeys leading lions" and what is worse, they are ignorant of their ignorance. They hold the hopes and aspirations of loyal workers in their hands without realising it. The research behind my book Open Source Leadership reveals what it takes to be successful, only problem is you have to be prepared to declare yourself a beginner in that domain.

  • Jessica Chaikowsky

    Exceptional article - I've been a student of culture/strategy for a while and this is one of the best descriptions yet (the fact that it's concise with lots of great metaphors helps). The linkages between strategy and culture are clear and I love that 'brand' is also brought into the discussion as the glue (althought I think, Shawn, that this is the start of a new article, please!) 

  • Cedricj

    Culture or "the way we do things around here" is the last sacred cow to be sacrificed. 

    Great distinction between strategy and culture. I like what one person wrote "culture eats strategy for breakfast every day"

    cedricj.wordpress.com
    Inspiring leaders to inspire others

  • Mike Myatt

    Hi Shawn:

    I enjoyed your perspective and the strategy vs. culture debate. I agree with you that a balance must be struck between the two, and that one drives and compliments the other. I took a bit of a deeper dive here if you're interested: http://www.n2growth.com/blog/c... 

    Best,
    Mike