Strategy + Culture = Results
“The prize for closing the strategy-to-performance gap is huge – an increase in performance of anywhere from 60% to 100% for most companies.”
Turning Great Strategy into Great Performance, Mankins & Steele, HBR, 2006
I recently got involved in an online discussion on the relationship between strategy and corporate culture. To me it did not seem like people were really getting to the heart of how the two related, so here is my take. I would welcome your views and debate.
Effective strategy execution comes down to a universal understanding of the overall strategy, engagement, alignment and focus. It’s about head and heart – the head being what needs to be done, and the heart – the culture – dictates how this can be done through behaviours (and ultimately how effectively this can be done).
If the culture is ineffective and leadership recognises this, part of the strategy should be to change it. If, on the other hand, it’s an effective culture, leadership should consider how to leverage and / or maintain this competitive advantage. The problem arises when the culture is rotten but leadership does not see it. This is why such a key part of my work around helping companies with execution is helping develop leaders – the fish rots from the head.
Poor leadership (not management – leadership), means an unhappy culture, and no matter how great the strategy, with an poor culture, it is not possible to execute strategy effectively. If the performance of your strategy is not what it should be, it might be worth taking a long hard look at your culture and ensure it is encouraging the right behaviours – collaboration, agility (and the willingness to experiment), teamwork and ambition.