Culture trumps strategy? Exactly never.
Peter Drucker is often named as the originator of the phrase “culture eats strategy for lunch”. The attribution may, or may not be true. But his name certainly lends gravitas. I prefer the following:
How About if Culture and Strategy Eat Lunch Together
It appeared in an article with that same title, in which the author wrote, “If I hear the phrase ‘culture eats strategy for lunch’ one more time, I’m gonna smack somebody.” While I wouldn’t resort to violence on the question of lunch, I do believe that culture trumps strategy exactly never.
Culture Trumps Strategy or Strategy Trumps Culture?
Neither or. Culture and strategy are partners in a company’s success, or it’s failure.
The following true story illustrates the point.
Once upon a time there was a Great Company. It grew to be one of the largest, most profitable high tech companies in the world, at that time. It helped launch the high tech era. It was an innovator in the computer industry. It was also ahead of it’s time in understanding and creating a great people-oriented culture.
There were many articles and studies written about the company culture. One study described the culture in the following ways:
- Experimentation was expected. Failure was tolerated.
- Learning was intentional and structured into the process by way of post-mortems. There were almost endless opportunities, and support, for learning and growth.
People were:
- Encouraged to give candid feedback
- Expected to build and work in teams and across functions to create products that solved real problems in the real market place
- Expected to “do the right thing” for the corporation, for the organization they worked in, and for themselves
- Free to be themselves and to discover the best way to get work done. With that freedom came accountability and responsibility
The Great Company Dies. The Culture Lives On.
It was a great culture. It produced great results, until the strategy failed. The company bet it’s future on the wrong predictions regarding where technology was headed. There was a degree of hubris, possibly a great degree of hubris, in developing this strategy. There was more hubris, and a bit of self-delusion, in sticking with it, when all signs indicated it was a wrong bet.
But let’s consider a different perspective. At the 1st annual Ultimate Culture Conference, Ed Schein, former MIT professor, posits that the required strategic shift would have changed the Great Company’s culture. According to Schein, there’s a direct relationship between what the company produces, its core expertise, and its culture. I agree. A engineering culture is different from a nursing culture. So did the Great Company chose to preserve its culture, rather than change the culture to fit a new strategic direction?
Mute point, because…
The chosen strategy failed and the Great Company dissolved. Three things live on.
- The culture
- The credit union
- The personal relationships and professional networks that were born at the Great Company
The culture was exported and integrated into many new companies founded by people who worked at the Great Company.
The credit union was founded by people who worked at the Great Company. It too shares many aspects of the Great Company’s culture.
The personal and professional relationships grew strong because the culture encouraged strong working relationships by way of:
Open and honest feedback
Personal freedom and accountability
Responsibility for the greater good
Experimentation and learning
Doing the right thing
Conclusions?
The Great Company’s culture succeeded. The strategy failed. The Great Company is no longer. You decide whether culture trumps strategy or whether they’re equal partners in a company’s success.
Care to share your thoughts?