The Fake Battle Between Culture and Strategy

breakfastThe other day I came across yet another article/post declaring that "Culture eats strategy for breakfast" (or lunch, or dinner, or afternoon tea...). I tweeted it out, copying my friend and colleague, Jeff De Cagna, since he and I have been discussing this topic lately. Jeff (like me) does a lot of work with organizations on strategy. So he gets particularly annoyed at the "culture eats strategy" meme. If that's the case, he argues, then why do organizations work so hard on doing strategy well?! Why are there so many smart people in so many different industries who emphasize the importance of good strategy, if culture is actually higher on the food chain?

It's a good point. Strategy is critical to organizational success, and to suggest otherwise takes us in the wrong direction.

That doesn't mean, of course, that culture isn't also very powerful. The problem with the "culture eats strategy" meme is that it creates a false distinction. Culture and strategy are, in fact, two sides of the same coin. Culture tells us what is valued inside an organization. In that regard, it's a strong driver of behavior. This is why people argue it can eat strategy--because you can decide on a strategic direction, but then have the culture push people into behaviors that make movement in that direction very difficult. I've seen that, and it can definitely be very frustrating.

But that's not culture eating strategy. That's simply not having the internal capacity you need to implement your strategy. Strategy is not just direction, it's how to achieve it. And culture is critical in achieving a strategy, since it drives behavior, as mentioned above. So of course your culture should be tied directly to your strategy.

This is something that is too often overlooked in conversations about culture: the whole purpose of organizational culture is to drive the success of the organization (see my ebook for more on that). Culture can't do that independently of the strategy, since that also defines how success will be driven.

Zappos gets lauded for its awesome company culture, and deservedly so. But the culture that Zappos has was not created because it was cool or would get attention from the business press. It was created because it was tied directly to what drives their success. Strategically, they determined that customer service (or in their words, giving the customer a WOW experience) is absolutely critical to winning in their market. They sell shoes online, for crying out loud. If you can't wow people, you're not going to get them to order shoes over the internet. So their culture was built with that in mind. They explicitly value decentralization and authenticity, for instance. They give their call center employees extensive authority to grant upgrades or discounts to customers, and they don't use call-center scripts, because they want employees to be themselves. They see that as a critical support to making that WOW experience happen. Culture and strategy are integrated.

So culture and strategy should not be separated. Neither eats the other for a meal. You either do them both well, or you get mediocrity. So what's it going to be?

 

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15 Comments

  1. 14.01.2014 at 7:29 am

    Good stuff Jamie. I’ve used similar arguments for years.

    When developing strategy, you’ve got to consider culture. For example, you can’t build strategies that expect (or demand) agility when your culture one built on a slow-moving, tradition-based bureaucratic system.

    • 14.01.2014 at 7:54 am

      Hmmm. There goes most companies’ hope for agile strategies! 😉

  2. 14.01.2014 at 9:44 am

    Excellent point Jamie. Let me share an observation that I’d like to hear you and your colleagues comment on.

    In my strategy (and integration) work with clients, I’ve found the word “culture” to be easily dismissed by executives. It seems unimportant to them because it is in some ways difficult to define or influence. Instead, I talk about “mindset” as one of key drivers for a successful strategy. For me (and them I believe) “mindset” is more actionable, “own-able” and is something an executive can impact by example. That executive’s mindset (walking, talking and living the strategy) does more to impact “culture” than trying to change culture in the absence of a mindset shift from the top. I think if you look the very best examples of culture (like Zappos), I think you’ll find that the executive “Mindset” is the force behind it.

    This may just be semantics but I’ve found a difference in acceptance of culture shift when I characterize it as a mindset shift.

    Love to hear your thoughts!

    • 14.01.2014 at 5:00 pm

      Thanks for weighing in, Michael. Culture is definitely a tough word, and I struggle with it. More than one person has told me to stay away from “culture” consulting for that reason (but I just can’t seem to help myself). Per Stowe’s comment, you can even pull out differences in complexity whether you are talking about “organizational” culture versus “corporate” culture. My bottom line is to push the client for clarity, no matter which words they use. Sometimes I push them on defining culture, to make sure they’re not just hiding behind its complexity. And yes, I think mindset shifts are a key piece.

  3. 14.01.2014 at 10:40 am

    I disagree with your framework for discussing organizational culture. Cultures don’t have a ‘purpose’ in the way you suggest, like the purpose for having chairs or roofs. They are an outgrowth of human sociality, arising from the needs, wants and desires of all members of the culture. They aren’t directed by the company’s leaders, like steering a car. And cultures aren’t oriented around corporate success, per se, they are the totality of the behaviors of people in the organization. What you are talking about is more like corporate ‘culture’, which is a set of principles promoted by management for the purpose of getting the organization to move in a certain direction. But that is shallow compared to organizational culture.

  4. […] Culture and strategy are, in fact, two sides of the same coin. Culture tells us what is valued inside an organization. In that regard, it’s a strong driver of behavior. This is why people argue it can eat strategy–because you can decide on a strategic direction, but then have the culture push people into behaviors that make movement in that direction very difficult. I’ve seen that, and it can definitely be very frustrating…  […]

  5. 16.01.2014 at 7:44 pm

    I echo Stowe’s sentiments about culture (vs. strategy). I have been on both sides of the fence in terms of my business focus. In the earlier part of my business, I helped companies in terms of high level strategy development. Now my focus is on the leadership and organizational side of the equation to drive success. And, yes, that includes culture consulting :)).

    Why most leaders and companies (perhaps consultants as well) tend to favor strategy as the driver is because it is tangible, left brain oriented, rational and *sets direction* (culture drives actual direction), etc. I see strategy as “rules of the game,’ the headline, is focused on hard metrics, and focuses on the financial balance sheet. So, yes, it is important to the company for success.

    At the other end, culture is intangible, emotional, right brain oriented, is the “spirit of how the game will be played,” the story itself, the driver of engagement and execution, dynamic, continuously changing and complex, driver of significance and meaning, focused on the soft metrics and on the emotional/social balance sheet.

    While they need to be continually aligned with each other, culture is the foundation to all **sustainable** company success. Culture encompasses every aspect of the company — its rituals/routines, the “stories” shared in the company, a company’s symbols, physical environment, power structures, organizational structure and control systems, collective behaviors and thinking, etc.

    If you think strategy should drive culture, you don’t really understand culture.

  6. […] The other day I came across yet another article/post declaring that "Culture eats strategy for breakfast" (or lunch, or dinner, or afternoon tea…). I tweeted it out, copying my friend and colleag…  […]

  7. 18.01.2014 at 9:39 am

    Interesting discussion and I see both sides. But I think the important point here is where you said,

    “But that’s not culture eating strategy. That’s simply not having the internal capacity you need to implement your strategy. Strategy is not just direction, it’s how to achieve it. And culture is critical in achieving a strategy, since it drives behavior, as mentioned above. So of course your culture should be tied directly to your strategy.”

    I think when culture east strategy for lunch it’s because the so-called strategy happens behind closed doors at the executive retreat, instead of having strategic conversations involving everyone in the org and being infused throughout the whole system so that culture can work for it, not against it.

    • Jihaan Haffajee
      12.02.2014 at 5:36 am

      Agreed Maddie Grant. The only way you’re going to get cultural buy-in for your business strategy is if everyone is involved and able to contribute. Culture stems from collective, rather than individualist thinking.

  8. 18.01.2014 at 1:30 pm

    @Stowe and @Denise–

    I do admit that my approach to culture here does not represent the full complexity and depth of organizational culture. I have chosen to define culture in a way that makes it more accessible to my clients. I don’t think I am OVER simplifying, but I guess only time will tell. But even at its deepest, I disagree that culture is not something we as participants in the culture can shape. We can’t control it. We can’t push a button and have it do what we want. But cultures do evolve, and the efforts of groups of people within those cultures can and do have an impact on the direction of that evolution. In a system as small as an organization, the simple act of who you hire or fire I think can have a big impact.

    And I still maintain that culture and strategy should be connected, if only because cultures MUST evolve, in the sense of “what got you here won’t get you there.” That culture that worked in the past could very well be bringing you down today. So culture’s power is dependent on context, which includes strategy.

    And thanks both of you for contributing to the conversation!

  9. Mark J. Golden
    19.01.2014 at 2:48 pm

    I have been guilty of repeating the meme that culture trumps strategy (or variations thereto) and I think this is an accurate assessment of what goes on in many, if not most of our organizations.

    Perhaps a more accurate statement is that strategy approached without reference to the prevailing culture, or that minimizes the culural inertia that any new strategy must overcome, IS going to be eaten up by that culture. Established habits of thinking, behavior, bias, paradigm will wear down the initial excitement of any new strategy, even if positively received, unless that strategy was crafted and is pursued with a respectful appreciation of the culuture it is up against. (Old habits are hard to break and new habits of behavior are hard to establish.)

    Perhaps it is a tautology to observe that a strategy that is not deeply rooted within the established organizational culture, or (if a cultural changes is necessary for strategic success) does not include tactics to ensure that those changes occur, is no strategy at all. It is naive and wishful thinking masquerading as strategy.

    And THAT happens a lot in voluntary associations.

    So I stand by my observation that a lot of strategy is crafted without taking culture into consideration and that culture trumps any strategy that ignores culture … But that is NO excuse to abandon the effort. It is merely a challenge to construct better strategy in a culturally aware manner.

    • 20.01.2014 at 6:01 pm

      Thanks for weighing in, Mark. I think we both agree: it’s high time we held ourselves to a much higher standard when it comes to (a) strategy work, (b) culture work, and (c) the important connection between the two.

  10. […] “Strategy is critical to organizational success”, writes Jamie Notter, “culture tells us what is valued inside that organization.” In this article he looks at the fake battle between Culture and Strategy. Jamie Notter […]

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