4 Steps to Take When Strategy and Culture Are at Odds

Growth is Limited When Strategy and Culture Are at Odds
When strategy and culture are at odds, it is nearly impossible to reach your business potential.  Why?  Because your strategy must go through your people and your culture to be implemented.

Examples of Misaligned Strategies and Cultures
Imagine the struggle when your overall strategy competes with your corporate culture.

• Customer Focus Example
  Imagine the difficulty in executing a strategy to deliver long-term and relationship-based value (a customer intimate approach) like Whole Foods Market in an organizational culture that values short-term, transactional interactions (a transactional customer approach) like McDonalds.
• Market Approach Example
  Imagine the difficulty of bringing new and innovative software solutions to market (a market leader approach) like Tesla if the predominant organizational culture focuses on legacy hardware products and only introduces new products to market after the market has shown they work (a market adopter approach) like Kia.
• Decision-Making Approach Example
  Imagine the difficulty of making effective and timely decisions in the field if the predominant organizational culture values all significant decisions be made by top leadership (a centralized approach) like the US Military versus allowing individuals to make decisions at the front line (a decentralized approach) like Southwest Airlines.

Strategy and Culture Alignment Matter
Our organizational alignment research found companies that align their culture and talent with their strategy grow revenues 58% faster, are 72% more profitable and outperform unaligned companies in terms of customer retention, leadership effectiveness, and employee engagement.

Your corporate strategy is the path you intend to take to profitably grow your business. But when your approaches to get work done and your workforce are oriented in different directions, there is little chance you will achieve high performance business results.

Four Steps to Take When Strategy and Culture Are at Odds
Here are four steps to take when your strategy and culture are at odds:

1.  Clarify Strategic Goals
You would be surprised to learn how many companies try to change their company culture before they have a clearly defined strategy for success. While we applaud the intentions behind improving corporate culture, we know that a culture must align with and support a clear, believable and implementable strategy if you want it to help move your strategy forward.

Is your strategy clear enough?

2.  Agree Upon Your Current Culture
Too many leadership teams begin culture change by defining their desired culture. While the desired culture is vitally important to articulate, we find it to be more effective to begin with a candid conversation and clear agreement about the state of the current culture.  Until you assess your current organizational culture and agree upon where you are, it is difficult to create a path to where you want to be.

3.  Define the Culture You Need to Execute Your Strategy
Once your business strategy is clear and you have a good handle on your current workplace culture, it is time to define the cultural attributes required to best execute your strategy. We like to look at ten research-backed cultural dimensions:

• How You Approach Your Market– from adopter to leader
• How You Treat Customers – from transactional to intimate
• Where You Want Customer Loyalty to Be – from individual to company
• Where You Focus Your Energy – from internal to external
• How Much Risk You Tolerate – from low to high
• How You Operationalize Your Strategy – from low to high process variation
• How You Make Decisions – from centralized to decentralized
• How You Value Information – from fact-based to intuition-based
• The Type of Atmosphere You Want – from social to disciplined
• How You Balance Results and Behaviors – from “the how” to “the what”

4.  Prioritize the Critical Few Cultural Changes that Matter Most
When it comes to culture change, we have found that less is more. Trying to make more than one or two major cultural shifts at once is often the recipe for disaster.  Pick the one or two cultural changes that matter most to your strategy and worry about the rest later.

The Bottom Line
When your strategic priorities are supported by the daily behaviors and attitudes of your workforce, everyone pulls in the same direction — toward shared success.

To learn more about what to do when your strategy and culture are at odds, download The 3 Levels of a High Performance Culture