Culture is StrategyPosted: May 3, 2012 An attractive company culture is important, but is it as vital as everyone is giving it credit?
Within the past few months, you might have noticed a lot of hoopla in the business community on the idea that a strong corporate culture will outperform business strategy every time.
I agree…partly. Maybe 50%.
I’m partial to creating an infectious corporate culture. It’s not wrong to say that a strong organizational culture is important. In fact, I believe it’s vital to the success of your company. Organizations that understand how to create a strong alignment of their strategy and core competencies throughout all their activities, departments and initiatives will be more successful than those who only have superficial alignment, given the assumption that their strategy and core competencies are competitive. As the great contemporary strategist himself said:
Strategy is about combining activities…It is more useful to think in terms of themes that pervade many activities, such as low-cost, a particular notion of customer service, or a particular conception of the value delivered. These themes are embodied in nests of tightly linked activities.
What does that mean for the meme-like mantra: “Culture eats strategy for lunch”?
Culture is strategy…or at least part of it. They aren’t foes. They’re family.
Let’s compare this idea of culture versus strategy to healthy eating and a healthy lifestyle. A healthy lifestyle (strategy) includes physical activity, an appropriate amount of rest, healthy eating (culture), healthy relationships, etc. Healthy eating isn’t enough to obtain a healthy lifestyle, but it’s a part of choosing a healthy lifestyle. In the same vein, a great company culture isn’t enough to obtain competitive advantage. The culture needs to be aligned with all the other activities in the organization.
A company that aligns its activities, competencies and core values with its business strategy (i.e. appropriately develops and implements its business strategy) will have a healthy corporate culture. The culture will synchronize to the overarching business strategy. Great culture is an intended symptom of great strategy.
IBM, Apple, Zappos, Starbucks — these are all the classic examples of great company culture. You can see it immediately when you walk in their stores, talk to their employees or listen to customers’ stories. It’s easy to point and say, “Look, there’s a company doing it right. What a great culture. That’s what we need.”
But what some people don’t see is that these companies are the perfect case of excellently executed business strategy. Their culture is aligned with their business strategies.
Great strategy starts with values and vision, develops into value offerings, and is seen throughout all of the organization’s activities and implementations. To quote Porter again, this is what we call “third-order fit.”
Does your organization have third-order fit? Is there any slight disconnect between your culture and the rest of your business activities?
Related: Culture: It’s a Heart Thing
Related: Strategy – The Real Money Maker
Please feel free to leave your thoughts in the comments section below. I’d love to hear from you!
You can also contact me directly via this page.
If you liked the article, show me some love and share it with your peers however you like to share content (common sharing buttons are provided below).