Every leader who has grappled with a shift in strategy for their firm understands the powerful gravitational pull of organizational culture.
A firm’s culture keeps management teams from flying off in completely disconnected directions. It also inhibits much-needed exploration and it serves as a powerful force of resistance for what Geoffrey Moore describes as asymmetrical bets—those investments outside of today’s business that define tomorrow’s growth opportunities.
There’s an oft-quoted statement: culture eats strategy for lunch. Very true if the change is mismanaged and the culture disrespected.
While the strategy might be on the lunch menu, competition and the forces of disruption and creative destruction guarantee that a failure to identify, invest in and nurture Moore’s asymmetrical bets might find your firm as the entrée on the dinner menu at that popular restaurant, Irrelevance.
Good strategic leaders respect and leverage a firm’s culture, but they don’t let it unduly inhibit change.
5 Ways to Leverage Your Firm’s Culture While Building the Future:
1. Respect the past and present. Too often leaders talk about the need for change and the pursuit of new directions in terms that are interpreted as critical or even derogatory towards legacy and current businesses. Test your messaging about change with key thought and network leaders in your existing businesses and adjust as needed.
2. Watch the dissonance and educate your employees. A client company held a Town Hall Meeting one day to celebrate the latest solid numbers and then kicked off a strategy program the next week with an emphasis on moving into new, high-growth markets. The reaction was one of confusion.
The employees weren’t aware that anything was wrong…and in fact, they felt that everything was great. While management was spot on in the need to find new growth areas to nurture for the future, they failed to properly position the current business as a valuable Cash Cow, but not a growth vehicle, in the minds of the employees.
3. Don’t Make it Seem that Only the Cool Kids will Work on the New Stuff. Steve Jobs famously divided the company into the best and brightest and not the best and brightest in developing the next incarnation of the Mac. It worked for him, but unless you have the credibility and gravitas of Jobs, it’s not a good plan.
4. When exploring new growth opportunities, don’t shirk the need for strategy work in legacy businesses. The work and team members might be different, but the importance of forming and framing a viable strategy for current and future businesses is identical. Use Rumelt’s Good Strategy approach by requiring teams to work hard on developing a clear and outside-in view for diagnosis and guiding philosophy.
5. Bring the work outside of the conference room and get the entire organization involved. While not everyone can attend every strategy meeting, good process management will ensure that everyone has an opportunity at one point to share ideas and participate in implementation. Your customer facing employees have valuable insights that should be mined. Internal process and functional leaders are stakeholders in driving the changes needed to execute on strategy. Involvement and engagement create buy-in.
The Bottom-Line for Now:
Most of us in most of our firms must face up to the reality that yesterday’s marketplace victories are sources of pride but not sources of tomorrow’s best opportunities. New and different doesn’t mean better…it just means new and different…and essential for survival and future success.
A strong culture is an asset to be treasured, but you have to deliberately put the culture to work in the process of building the future. Fail to address culture and to respect it, and we’ll, we’re back to that issue of strategy for lunch.
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Great post, Art! You build a cogent case for the importance of paying attention to culture and involving people early on when there is a strategy shift or during change effort. And your 5 tips are very helpful. My post this week gives an example of how not paying attention to culture during a strategy shift impacted a Fortune 500 company in 1994. If the leaders had read your post, it would have saved a lot of time, money and angst in the 11th hour.
Thanks, Jesse! It’s a nice complement to your existing post. This is an all too common tripping point that merits our focus and respect. Art