Culture or Strategy? Five Rules to Make Sure You Have It Right

| August 6, 2014

15640671_m“Culture eats strategy for breakfast” is the famous mantra of the celebrated management consultant Peter Drucker (author, educator, recipient of the Presidential Medal of Freedom, and “the man who invented management”).

Yet many business leaders spend most of their time trying to get their strategy right, and much less time developing the culture that will attract and retain the right employees who will implement those plans.

It is important to know the difference between strategy and culture. Strategy is concerned with goals and objectives. Culture is about values and practices. Strategy is in plans written down, with measurable results and milestones to be achieved by activities. Culture cannot be written, but it is embedded in the character and behavior of your personnel.

If you have the right people and the right culture, strong performance will naturally flow from it. The most striking example of this is the “Nordstrom Employee Manual” which governed the company for years and was written on a card given to each employee:

welcome_to_nordstrom

Culture is so important and so powerful because it is far more resilient than strategy. Company strategies come and go and change with market conditions. In the words of Heavyweight Champion Mike Tyson “Everyone has a plan until he is punched in the face.”

A strong company culture will thrive in good times and survive in bad times. It is also the best way to build client loyalty, because studies show that there is a high correlation between the way your employees feel about your company and the way your customers do.

This is because people are loyal to culture much more so than to activities. People are empowered by values and vision, not data points. To understand the difference on a grand scale, compare the famous words of Martin Luther King (“I have a dream”) with the common speeches of politicians (“I have plan”). In the words of business writer Torben Rick “Anyone can copy your strategy; but nobody can copy your culture.”

This is not to say that culture and strategy are trade-offs. Quite the contrary. Your business strategy is the like the rudder of a boat, giving direction on the journey. Culture is like the current of a river, natural and forceful. When strong culture supports sound strategy, your business flows with the current and everything moves forward. But the best business plans in the world will fail if you ignore the importance of building a company culture – it will be like forcing your boat upstream, requiring much more effort, incurring much more expense, and showing much less progress. Or, as Robert Stephens (the Founder of Geek Squad) put it “Advertising is a tax you pay on having an unremarkable culture.”

So how do you build and cultivate company culture? We offer the following five rules:
1. Have a Purpose Beyond Profit. Expressly describe the purpose of your business enterprise as one where you are striving for a greater good: delivering value, filling needs, serving the community. Let profit be a by-product of your activity and not the main goal.

2. Involve Everyone in the Shared Vision. Make it clear that this is something we all do together. There should be no competition or finger pointing among departments or individuals. Rather, seek and encourage people who are excited by achievements realized together.

3. Celebrate Wins Together. Intentionally take time and take note of those positive events that can serve as milestones that show your personnel the importance of what they do for the company. People encouraged by success will perform much better than people afraid of failure.

4. Set the Standards and the Goals High. For most of your personnel, define goals with a metric that they can understand and a standard that they can attain with their best performance (and then celebrate when they do). For your best people and your higher management, set the goals even higher. Vince Lombardi, in his first speech to his team as a head coach set the bar as high as possible: “Gentlemen, we will chase perfection, and we will chase it relentlessly, knowing all the while we can never attain it. But along the way, we shall catch excellence.”

5. Demonstrate the Culture and Standards Yourself. Culture is learned by example. You cannot ask people to have a higher purpose if you don’t. You cannot expect personnel to be loyal to the team if you are not loyal to them. You cannot demand of others what you are not willing to demand of yourself.

These principles, taught by business consultants, all sound borrowed from the Scriptures, especially the words of Jesus Christ in His Sermon of the Mount.  He did not tell his disciples to come up with plans and strategies, and in fact just the opposite (“Therefore do not worry about tomorrow” Matthew 6:34).  Rather, they were to have a purpose beyond profit (“Do not lay up for yourselves treasures on earth … but lay up for yourselves treasures in heaven..” Matthew 6: 19, 20).  Everyone was involved in the same shared vision (“You are the light of the world, a city that is set on a hill cannot be hidden.” Matthew 5: 14).  The standards and goals were set very high (“Therefore you shall be perfect, just as your Father in heaven is perfect” Matthew 5: 48).  And above all, Jesus demonstrated the culture of the Kingdom of Heaven in all He did – and inspired His own generation and every generation since to reach for the knowledge of God.

 

 


Category: Management