Monday, September 26, 2011

Aligning Culture and Strategy - Part #1

Regularly, I listen to senior executives stand up before their company and share their thoughts. With a huge power point presentation behind them, they attempt to create clarity, focus and commitment. Nine times out of ten, the presentation is poorly built, extremely wordy, and generally confusing.

“Every day as leaders, we have three boxes on our desk...” writes Howard Morgan, Phil Harkins, and Marshall Goldsmith, editors of The Art and Practice of Leadership Coaching: 50 Top Executive Coaches Reveal Their Secrets, John Wiley & Sons, 2005. As they explain, box # 1 equals managing the present. Box # 2 focuses on selectively abandoning the past, and Box # 3 centers on creating the future. As they explain, most organizations spend time in box #1 and call it strategy. However, strategy is really about box # 2 and box # 3.

Before we start exploring alignment, let’s first reexamine strategy. In the beginning, we need to remember that the day strategy is introduced into the organization is the day it starts to die; the only question is how fast. This is sometimes called the strategic decay rate.

Second, most company’s strategies are almost entirely transparent to competitors and potential competitors. The ease with which strategy can be imitated and commoditized makes it nearly impossible to stay ahead of the game.

Third, Edson De Castro, CEO of Data General, 1978, wrote about a very key concept related to strategy, namely “ Few corporations are able to participate in the next wave of change, because they are blinded by the business at hand.” We forget some days that all leaders are both producers of strategy and consumers of strategy.

Fourth, strategy impacts communication. It can confuse and overwhelm people or it can give people at all levels the tools to redefine the ideas that shape the choices and actions. The key for us as leaders is to remember that strategy creates language for people to solve problems and improve decision making up and down the organization. Finally, strategy must provide meaning as well as guidance to the work of the organization.

When we reflect on the word strategy and the above key points, we could replace the word “strategy” with the word “culture.” Then the following statements could be written:

- all leaders are both producers of culture and consumers of culture.

- culture impacts communication.

- culture creates language for people to solve problems and improve decision making up and down the organization.

- culture provides meaning as well as guidance to the work of the organization.

For us here today, we always need to remember the following quote by Peter Drucker: “Culture eats strategy for lunch.”

Jason Jennings in his book, Less is More: How Great Companies Use Productivity as a Competitive Tool in Business, Penguin Putnam, 2002, writes “In productive companies, the culture is the strategy.... Unlike other companies, productive companies know the difference between tactics and strategy. The difference is the foundation that allows them to stay focused and build remarkable companies. They have institutionalized their strategy.” From my experience, I have realized that productive companies institutionalize their strategy, in part, by institutionalizing their culture.

Yet this summer during a breakout session at a major regional conference, I was impressed by a young executive who had the courage to share with the group the following, “I am not sure I know what strategy is, and I am not sure how to communicate it to others.” This is a common problem and one I am seeing more and more often this year. The same goes with the concept of culture.

This week I encourage all of you to sit down with your team and discuss what is strategy and what is culture. Then, explore how they are interconnected. If you need help doing this, feel free to call.

Geery Howe, M.A.Consultant, Executive Coach, Trainer inLeadership, Strategic Planning and Organizational ChangeMorning Star Associates319 - 643 - 2257

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