Saturday, 26 May 2012

Does culture eats strategy for breakfast?

The concept of corporate culture basically refers to the unwritten rules influencing and guiding the way employees perform their activities in the workplace, that is, “the way we do things around here”, and to the behaviour employers expect their employees to exhibit in the organizational settings, whereas organizational strategy is basically concerned with the identification of the direction an organization decides to point to and more in particular with what an employer needs to do to reach the identified position.

Inasmuch as organizational strategy is concerned with the “what” side of the process aiming at identifying and attaining the organizational objectives, corporate culture is concerned with the “how” side of the same course of action. Organizational strategy and corporate culture can thus be regarded as the two sides of the same coin: organizational success. As such, it might apparently seem making no point contending that “culture eats strategy.” Since the dictum “culture eats strategy for breakfast” is used to stress the circumstance that culture prevails over strategy, it might provide the idea that “how” things are done in the workplace is more important than “what” organizations should do to achieve competitive edge. This may lead to a situation in which employees actually know how to do things and how to go somewhere, but have indeed no idea of what the employer wants and where this aspires to go. The meaning behind the assumption “culture eats strategy”, however, is not as simplistic as it might apparently seem to be.

The dictum “culture eats strategy for breakfast”, attributed to Peter Drucker, become popular in 2006 when Ford Motor’s president Mark Fields during a public speech, taking heed of the experience he had gained when working at Ford, emphasized the remarkable significance of the role played by a supporting culture throughout the implementation of change. The significance of this statement and the idea behind it clearly have far-reaching implications.
The need for change emerges nowadays at an increasingly faster pace; it is hence of paramount importance for organizations being flexible enough to, if anything, promptly adapt to the impulses coming from the exogenous environment. The introduction of change, notwithstanding, is habitually likely to be opposed by antagonistic forces, better known as restraining forces, which more often than not are so strong as to seriously risk jeopardizing the successful implementation of the overall change project.

A supportive culture indisputably plays a fundamental part in the effectual introduction and implementation of change in a business. Despite the increasing pace at which change occurs in the exogenous environment, corporate culture, whose speed of change has actually lately increased too, is unlikely to be subject to change at the same pace as that characterizing the external context.
Employers habitually encounter considerable, sharp resistance when implementing change processes within their organizations. Yet, most of these projects actually miserably fail in that organizational culture not only proves not to be supportive of the process, but what worse actually favours the emergence of a strong resistance to its successful implementation. Employers at large are well-aware of the dangers caused by the restraining forces to change insofar as, in most of the cases, needing to implement change procedures concerned with organizational culture prior to introduce other types of change, which may affect the entire or the largest part of the business.

This does not clearly mean that changing culture is a straightforward process; on the contrary, the processes of change concerned with organizational culture invariably prove to be the most difficult processes to manage insofar as some practitioners suggest never drastically changing organizational culture (revolutionary approach), but rather working on it moulding and adapting it as better as possible to the changed circumstances (gradual approach).
Changing organizational culture invariably shows to be a very tricky exercise; notwithstanding, it sorely depends on how deeply a company culture is rooted in the business: deeply-rooted cultures obviously represent the hardest type of culture to change, whereas corporate cultures underpinned by readiness to change typically constitute the kind of culture most likely to be promptly altered. In the latter case, culture is indeed likely to be amended more straightforwardly and the implementation of change expected to encounter limited, if any, employee resistance.
As it actually nowadays happens with change at large, also corporate culture, using Lewin’s wording, should ideally be kept somewhat of in a state of constant “movement” and never be allowed to “refreeze” after the conclusion of a process of change. This despite, external pressure notwithstanding, corporate culture is not habitually subject to change at the same pace at which, for instance, technology, products, services and external markets trends are.

A completely different idea on the subject is advanced by Thomson, who maintains that an organization can be successful in the long-term only whether it is supported by a “viable corporate culture” which also has to be a “long-term culture” (Alofs, 2012). This view can be actually regarded as debatable in that long-term cultures will certainly become well-rooted cultures at some point in the future; giving thus rise to harsh resistance once the need to change these emerges.
As for what concerns business strategy, trying to determine whether this could be regarded as good or bad would definitely prove to be a pointless exercise. The most relevant features of strategy are arguably represented by consistency and coherence; the direction identified by the employer must essentially be that enabling this to attain its intended objectives and most of all to gain competitive advantage over its competitors. Corporate culture should be in turn consistent and coherent with the direction an organization intends to pursue. In order to effectually help employers to attain their intended objectives culture should hence be necessarily supportive of organizational strategy. As long as organizational culture will help employers to go where they have planned and intend to go this could be indeed deemed strong.
Employers should invariably pay particular attention to culture; these might also fail to pursue their strategy, but this should never occur for reasons related to the inadequacy of the culture these have fostered within the organization. The exogenous environment poses in fact enough threats of its own so that employers have to do whatever they can to avert additional problems arising from within.

As the right culture for an organization is that enabling this to attain its intended aims and objectives, corporate culture should theoretically change at the same pace at which strategy does. This entails that since strategy changes at an increasingly faster speed also organizational culture should. Yet, an increased frequency of change should enable employers to avert that the current culture may reach or stay for an exceedingly long period of time in the “refreezing” phase referred to by Lewin as the final stage of his change management model. This mechanism should in turn enable employers to develop and implement change management processes more confidently and with much more chances to be successful. On the other hand, nonetheless, changing too often corporate culture may cause confusion, mistrust and uncertainty amongst employees and give thus rise in the workplace to the formation of stronger restraining forces to change over time. Moreover, the activation of a process of constant cultural change may not invariably prove to be viable.
According to the circumstances, a change in strategy might not necessarily invariably entail a change in culture; yet, the culture existent in an organization may show to be effective to support the employer in the attainment of the identified objectives albeit these are subject to changes over time. Rather than constantly changing culture, with the risk of making unnecessary adjustments, employers should hence try to do whatever they can to develop and foster a culture supportive of change and organizational success, averting to revise it unless genuinely necessary. Cultures fostering innovation and flexibility are the less likely to cause the emergence of restraining forces. Under some circumstances, business leaders try to achieve this result instilling a constant sense of urgency, which whether not properly managed can in the mid- to long-term make employees feel under somewhat of an eternal state of siege and cause stress, anxiety and ultimately distress.
The best culture is that underpinned by the right values, which regardless of the circumstances and strategy pursued by a business remains invariably significant and appropriate. In general, it should be avoided to introduce “alien cultures” based on top-down, command and control management, nowadays very likely to prove to be sorely inappropriate and ineffective.

Culture clearly exerts a remarkable power and influence over strategy, but also strategy, that is to say the direction an organization wants to go to in order to achieve competitive edge, should be in turn capable to influence culture. For right or wrong a strategy might be perceived to be by employees, employers develop these in order to attain the business objectives and yield results for the benefit of their employees too.
Strong cultures can act as powerful motivators and are clearly of paramount importance for organizational success, these must support and favour the attainment of the organizational objectives, whereas do not have to contribute by any means to threat the organizational stability from within, in addition to the hazards and threats already posed by the exogenous environment.
Having a strong organizational culture, but not having an effective strategy can be tantamount to having tens of thousands of barrels filled up with oil whilst not having a car or akin to having a fantastic sport car and letting it standing still into the carport in that do not having any idea of where to go.
Organizational culture practically exerts a much stronger influence on individual motivation than strategy, but employees need to be aware of the importance that it has for their employers achieving their intended objectives and should hence support these in the quest. To receive the adequate support from their employees and provide these with more meaningful insight about organizational strategy, employers should involve as many individuals as they can in the strategy definition process.
Corporate culture is clearly as important as strategy; the two should not be indeed considered separately the one from the other, it is in fact just by virtue of the consistent combination of these two powerful components that employers can actually confidently and bravely strive in the market to gain competitive edge.
Corporate culture can potentially eats strategy, no matter whether for breakfast, lunch or dinner, but employers should do whatever they can to avert this to happen and make understand their entire workforce, by means of their involvement and the activation of a clear and open communication process, how significant is for them to achieve their intended objectives and yield the expected results. For the sake of the overall business stability and existence, employers should also clearly make individuals understand that it would really be ludicrous whether they should not achieve their intended results by reason of the lack of support of their staff. The market and competitors pose enough serious threats so that the organization resources and efforts should be definitely used to struggle in the exogenous environment, rather than in the endogenous.

Longo, R., (2012), Does culture eats strategy for breakfast?, HR Professionals, Milan, [online].