ORGANISATIONAL CULTURE – THE FOUNDATION FOR SUCCESFUL STRATEGY IMPLEMENTATION
Organisations, just like people are a product of their experience, and cannot give what they do not have. From my experience in dealing with businesses to set out a strategy or align their strategy with their organisational goals, I realized a problem which a lot of businesses overlook. Businesses have failed to build, nurture and develop a culture, but rather follow supposed current buzzwords and trends. “We have agile trained project managers”, “we have digital teams”, “our steering committee ensure our projects are run in an agile manner” are just some of the quotes that I hear often – guys, seriously? My response to them is “truly agile firms don’t just have agile project teams, everything about them from day-to-day operations is agile in nature”.
ORGANISATIONAL CULTURE – AN EXPRESSION OF CORPORATE DNA
The culture of an organisation is shown in their everyday operations and not reserved for special projects or situations. Using one of the most common definition, “organisational culture is a system of shared assumptions, values and beliefs, which governs how people behave in the workplace”. It reflects who they truly are and is usually a very good indicator of what they are most likely to accept and how best to approach them. Organisational culture includes the shared beliefs, norms and value within an organisation. Culture has two levels; the visible which includes dressing, language, social interactions and working methodologies, but also invisible which include beliefs and value system. The culture has a strong influence on people in an organisation and dictates how they function – both management and staff inclusive.
At a deeper and less visible level, culture refers to the values shared by a people in a group, often invented, discovered or developed as the group learns to cope with its problems of external adaptation and internal integration, and the culture tends to persist even when that particular group has left. Anyway, to fully understand the complexity of organisational culture, it is important to explore the existing theoretical perspectives namely; Integration; Differentiation and Fragmentation perspectives respectively. Unfortunately, this piece is not interested in theories but on the practical aspects of culture and strategy implementation – how strategy and structure intersects each other.
FACTORS THAT IMPACT ORGANISATIONAL CULTURE
EXTERNAL BUSINESS ENVIRONMENT:
The general business environment in which an organisation operates will hugely impact its culture. Socio-cultural influences will influence individual opinions about issues such as payments and rewards, status and communication methods. Furthermore, the specific market environments influence culture, Financial services sector is risk averse while stock brokers are deal oriented. On top of this market orientation is where he organisational culture evolves. Market conditions and industry dynamics such as speed of change, competition, changing customer behaviour and technological advancements will also impact the culture of an organisation.
There is not much evidence between leadership and culture empirically, but the existence of a credible leader reduces anxiety and increases belief among members. Organisational culture is hinged on the external environment where the firm operates, and changes to the external environment are often stemmed by thought leaders. Transformation and changes in the workplace are not for the faint hearted because there is no 100% guarantee it will yield positive effects therefore, it requires someone with ambitions and confidence in themselves and their ideas to drive such change. My Research corroborate earlier assumptions of Pettigrew (1979) and Schein (1991) that a founder influences the culture through own ambitions, and that the interactive process between entrepreneurs and their followers set the standards of doing things. More often than not, members of staff emulate and buy into the ideas of their boss. The founder’s prescription often set the standards of how things are done, although, sometimes the founder’s idea is not wholly accepted, so the culture development journey involves conflict, negotiation and compromise. However, businesses require strong leadership to develop culture and identity.
INTERACTION (FORMAL AND INFORMAL)
Everything about culture is in the context of a group – the identity of a group of people, and how the individuals in the group interacts with each other whether in a formal or social setting is a huge determinant of how much they can bond and how successful hey could be as a group.
Management style and designs of the hierarchical and reporting structures are things that have an impact on decision making and how quick information can be relayed, consequently, determines the speed with which action can be taken. These form the values and basis of acceptable attitudes / standards. The management style impacts corporate culture as it either decentralises power or concentrates power within certain levels / strata – consequently determines how operations are planned, set and managed. The informal socialisation process and events helps team members tell stories, discuss myths and is a means of sharing insights of what is and should be termed acceptable or unacceptable within the group.
It is sufficing to say that since the environment evolves and so does businesses, the organisational culture should be built in such a way that it can also continue to evolve and change with times if the organisation does not want to be left behind. Managing organisational change and its key success factors will be discussed in another post.
SUCCESFUL STRATEGY IMPLEMENTATION: ALIGNMENT WITH CULTURE IS IMPORTANT
Organisational culture is a key factor for effectiveness and standardisation and the alignment between a chosen strategy and corporate structure determines how successful the strategy implementation will be. Just like in sports, the coach selects team because of their personal attributes such as speed and endurance to match the particular strategy planned to counter an opponent. The strategy (game plan) also forms the training methods and all.
Sometimes, supposedly good strategies that have been proven to work still fail in certain firms, it is not because the staff are not good or that the strategy is bad, it is often because of culture-strategy misalignment. For strategies to work successfully and goals achieved, culture and strategy must be aligned at the most basic level. Goal setting must be aligned with and supported by systems, policies, procedures and processes within the organisation.
Agile cannot work if decision making is not decentralised – if we have to go to the PM or MD for every decision, then the agility and its savings will be lost to a bureaucratic culture. A lean organisation emphasizes lean in all her operations and not just in special projects else savings will be lost elsewhere. Truly digital company digitizes its operations as a whole and fully embrace digital technology without reliance on special projects or digital management teams and units. The true identity of a business should be entrenched in her DNA and reflected in her operations. Strategies should be selected based on alignment with core competencies of staff and corporate culture.
In conclusion, the more a strategy is in line with the values and shared beliefs of a business and her staff, the more likely the strategy will succeed. Whatever it is you envisage for your business, communicate and share the values with your team. Align your goals with your culture and you are on your way to glory. To change or better align your organisational culture with your corporate goals or to further explore the discussion, catch the author on Twitter: @Emeka_Nwonu