Why Culture Eats Strategy for Breakfast

August 4, 2014

By Mike Jacoutot, Managing Partner

 

Too often, companies have a strategic plan, but do not have a culture plan.  A company without a culture plan to “operationalize” their strategy is putting their success at risk. 

 

“Culture will eat strategy for breakfast!”  Peter Drucker.

 

You see, as good as your strategy may be, it is your culture that executes upon that strategy and creates a competitive advantage.  These days, there is no such thing as a sustainable competitive advantage in terms of a strategy or product.  Competition can copy your strategy and your products, but no one can copy your culture.  Just ask those who compete with Southwest Airlines or Zappos.  Your culture is your brand.  Building a great culture doesn’t come from the HR Department.  It comes from how the leaders live inside the business.

 

I am told all music is made from the same 12 notes.  Similarly, all cultures are made from the same six components: attitude, beliefs, values, behaviors, relationships, and environment.  When strategy and culture collide, culture will always win.  The strategy becomes “shelfware.”  The culture lives on.

 

Here are six tips to align culture with strategy;

 

  1. Complete a Voice of the Employee Survey.  On an annual basis, you should measure employee engagement.  The survey should effectively measure engagement in areas of the basics—(what do I get?), backing (do I have support?), belonging (do I belong?) and becoming (are there opportunities for me to learn and develop?). 

  2. Complete a deep review of your culture.  Engage an unbiased outside firm to do a cultural assessment.  Look at everything including but not limited to: hiring and on-boarding process, employee engagement, turnover, communication, recognition, rewards and cultural readiness. If acted upon, this may be the best money ever spent.   

  3. Create and communicate meaning.  A financial goal simply will not cut it in 2014.  Companies that tie their vision or “north star” to “meaning” for their employees are more successful.  One of the greatest visions of all time was JFK’s “We choose to go to the moon! We will put a man on the moon by the end of this decade!”  When a NASA janitor asked what he did, he replied by saying, “I am helping to put a man on the moon.”  Meaning is a powerful thing.

  4. Develop the proper learning progressions to ensure capability.  As your company begins to transform itself to align with the strategy, ensure your training elicits and reinforces the desired skill. The ability to change, requires and ability to learn.  Create an environment of continuous learning and become a learning organization.

  5. Align recognition and rewards to drive behavior.  If you are trying to improve customer retention and loyalty, then reward your employees for doing so.  If you are trying to improve shared services performance, then develop a shared services scorecard and reward for improvement.  Recognized behavior gets repeated; unrecognized behavior goes away. Be sure you understand the behaviors you desire and recognize accordingly.

  6. Communicate and recognize performance often.  Quarterly town halls, monthly conference calls, newsletters and CEO updates that share where the company is from a financial perspective and recognize performance are keys to success.   As the late Sy Syms, a New York clothier used to say “An educated consumer is our best customer.”  Same principle here.  “An educated employee is our best employee.”  Let them see how the company is performing from a revenue and profit perspective on a weekly/monthly basis.  Recognize top performance.

 

Unfortunately, most business leaders don't take the time to learn exactly what makes up an organization's culture, and even fewer know how important it is to the bottom line.  Your culture has an unbelievable impact on the bottom line.  Just consider this:  every interaction your employees have with a customer is a “moment of truth” whereby the customer may form an opinion of your company and thus, your brand.

 

At Butler Street, as executive operators, we understand the importance of culture in operationalizing strategy.  Hence, our tagline “Client and Talent Development. Perfected.”  We can help ensure alignment by working with you to build a system of reinforcing activities around strategy and cultural readiness.  Click on CONTACT and let’s talk.

 

 

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