February 24, 2023
by John O. Burdett
What endures, what provides the platform for growth, what shapes future performance, what enables different strategic scenarios to unfold … is the organisation’s culture.
Culture Is a Complex System
Three disabling pitfalls capture the nature of the emerging leadership challenge.
- Failure to recognise the scope and scale of the storm we are heading into. A failure to fully understand that exponential change ushers in an era of unprecedented change; a level of turbulence that will be unceasing, unpredictable and unyielding; a business environment where there is no steady state … no safe harbour to head for.
- Attempting to force breakthrough technology into an organisation that, by way of structure and design, was created for the mechanical world of the last century. Think starting anew, not “fixing up.” Think “drones,” not a multibillion, 3,000-kilometre wall.
- Being wedded to “culture drift” … the assumption that if we don’t manage culture we will, somehow, “magically,” end up where we need to be. Good luck with that one by the way. A version of culture drift is “incrementalism” – addressing culture one element at a time. Not only does this ignore the unintended consequences of standalone actions but time isn’t on your side.
Culture is a complex system that is only as strong as its weakest parts. Moreover, if a piece is missing it doesn’t work. An engaged workforce doesn’t mean you are heading in the right direction. Organisation values are essential but on their own they are not enough.
Where employees are less than fully committed to the brand promise, basically, you have no brand. It matters not what your unique strengths are … if you are not truly customer-centric your core competencies are largely irrelevant. No less important … addressing culture isn’t simply “change management” in a new guise. Symbolism, myth, habits, story, language, metaphor and measurement rarely find their way onto the change management stage. And if you think working on culture is a project … give up now, it will save time later.
Culture Enables Strategy
Conventional wisdom suggests that culture follows strategy. The dilemma is that in a world where strategy is persistently under attack, “the plan” has to be constantly revisited. The new dictum is culture enables strategy. What endures, what provides the platform for growth, what shapes future performance, what enables different strategic scenarios to unfold … is the organisation’s culture.
The work that supports the link between culture and performance goes back over two decades. Research, in particular by Kotter and Heskett, found a strong correlation between performance and the right culture. The relationship between culture and performance is further endorsed when you consider issues such as attraction and retention. Your best people don’t stay because they think you have a great strategy. Conversely, if you have a big enough “Why” you can change the world.
The challenge, of course, is not merely to possess a strong culture but to build a business environment that shapes how people act and, at the same time, supports emerging strategic scenarios. This speaks to changing the patterns of play, measurement, the ability to shape the culture conversation, bringing middle managers on board and inspirational leadership.
Managing Your Organisation’s Culture
Even where all the building blocks of culture are in place, if the leader in question lacks the ability to take people places they otherwise would not go, you still ain’t got much!
Our own research – and that of others – suggests that only 20% of organisations manage their culture. Power moves into a vacuum. If you are not managing your culture someone else is! And if those at the helm lack culture savvy take it as a given – the future of the business lies in the wrong hands.
Who is managing your organisation’s culture? The 60% or more of employees who are less than fully engaged? A cadre of executives who would rather things stay the same? The silo builders? Those at the centre who have forgotten that their role is to support the local businesses, not dominate them? Disaffected middle managers? A militant union? An owner whose raison d’etre is to make money and not make a difference? A dominant competitor? A predatory supplier? A segment of customers who demand distinct value but who are only prepared to pay commodity prices?
And the difference that makes a difference: Recognise that culture is managed from the outside-in but demands leadership from the inside-out; provide structure and guidance into how to have the culture conversation; become a storyteller; measure culture and work diligently to uncover (global) best practice – then improve on it. Our species are, above all else, copying machines with an inherent desire to be better than all the rest.
This article is an extract from “Tomorrow’s Leadership Will Be Different“, © Orxestra® Inc.
John O. Burdett is founder of Orxestra® Inc. He has extensive international experience as a senior executive. As a consultant he has worked in more than 40 countries for organisations that are household names. John has worked on organisation culture for some of the world's largest organisations. His ongoing partnership with TRANSEARCH International means that his thought leading intellectual property, in any one year, supports talent management in many hundreds of organisations around the world. Get in touch with John O. Burdett »