“Culture eats strategy for breakfast” Leadership and management guru, Peter Drucker
Challenge – Risk during times of change
Strategy-culture alignment brings great value to an organization. Employees are able to learn the culture over an extended period of time and become accustomed to the unspoken way things get done within the organization.
However in today's world, organizations are constantly changing and shifting, causing strategy and culture to do the same. When even the best strategies encounter a misaligned culture, it’s like getting stuck in molasses- progress slows and momentum is lost for all moving parts. This makes realigning strategy and culture essential, especially during the times of change detailed to the left.
- Leadership Changes
- Mergers or Acquisitions Take Place
- A Dramatic Downturn Happens
- Brain Drain Occurs
- Experiencing High Growth
- A new leader or changes to your leadership team often means there will be a shift in strategy. Alignment of the culture must follow suit for strategy to be effective.
- Two organizations joining forces, may or may not produce a new strategy. Regardless, mergers and acquisitions almost always means there are two competing cultures at play. Eighty-five percent of mergers or acquisitions fail because misaligned cultures are not effectively addressed.
- A sudden drop in performance typically prompts a change in strategy as a means of addressing the shortfall. While restructuring is a typical first move, the underlying belief system that created the downturn is rarely ever addressed.
- A large number of long-term employees exiting an organization coupled with new hire turnover produces what we refer to as “brain drain,” and this often requires a change in strategy, culture, or both.
- Organizations growing at a rapid pace need to quickly assimilate new employees into the existing culture that has contributed to their success.
Challenge – Execution Molasses
Culture often resides in the shadows. Sometimes organizations have a proven methodology for creating and cascading their business strategy, yet culture remains an elusive challenge. Purposefully managing your culture is difficult because it’s so nebulous, and often embedded in the unspoken ways that work gets done. Left unspoken, old ways of doing things can act like molasses, slowing critical change and innovation.
Creating a purposefully aligned culture
Ask your employees “What is culture?” and you will likely receive a variety of responses. You may hear a reference to “living our values” or “having the right people who are aligned, committed and engaged.” These descriptions form the foundation of a healthy organization, yet do little to align the unique ways in which people personally think about getting their work done.
To achieve maximum performance, your culture and strategy must be purposefully aligned. This alignment provides employees with clarity about the work they are performing and how it contributes to the overall success of the organization. Creating true alignment for your organization starts with bringing culture out of the shadows, in order to define, measure, and purposefully manage it.
Note of caution: You can’t run a marathon with a broken leg.
If your organization is severely unhealthy, we recommend that you don’t attempt to align your culture and strategy because the hurdles are simply too high and your efforts could result in a highly public failure. One such leader who experienced this was Ron Johnson, former CEO of JC Penny. To achieve culture alignment and effectively implement your strategy, you must have a healthy foundation. Your organization doesn't need to be in Olympic athlete shape, but it can’t be on life support either.
If your organization’s health is on life support, so to speak, start with solidifying the foundational areas outlined above and then make the necessary moves to align your culture.Align Strategy and Culture
Challenge - Strategy Underperformance
An aligned and purposeful culture can impact 50% of an organization’s overall performance. Even if two people on a team have a clear understanding of the goal, that does not mean they will approach their work in the same way. If one person believes in fact-based decision-making while the other relies on history, wisdom, and experience, there is misalignment, which often results in costly delays, rework, conflicts, etc. Operating as a healthy organization should always be one of your goals, yet the addition of a purposefully aligned culture has proven to produce significantly greater results. Here are the results of a 10 year study of over hundreds of organizations.
Realizing the results of a purposeful culture requires a connector from strategy to results, i.e. leadership
Managers are wonderful problem solvers, leaders help others discover solutions, however this doesn't mean their work is complete. As the world transforms to a knowledge-based workforce, the demand for stronger leadership continues to escalate. Knowledge workers require less problem solving and an ever-increasing need for direction. Creating followers by providing direction, is significantly more impactful and sustainable than merely managing performance. The BASIC leadership qualities that create followers and foster trusted relationships include:
- Beneficial Partnerships
- Aligned Emotions
- Sustained Determination
- Intellectual Flexibility
In times of change and when “culture is eating strategy”, you can minimize “organizational indigestion” by focusing on developing the BASIC leadership traits.Roadmap to Results