Time and time again, I have had the opportunity to observe how organizations operate, viewing firsthand high-performing cultures where extraordinary things are accomplished on a daily basis. These are places where people are aligned and unified through unique social contracts.
Companies with a weak or broken culture struggle harder and are negatively affected by the deficit. This demonstrates what most leaders know or are learning: Culture is today's major performance differentiator.
Culture creates the foundation for strategy and will either be a company's greatest asset or largest liability. While culture has many aspects and manifestations, its core should include a clear sense of purpose and shared values that guide decision making across the company.
And culture is manifested in terms of behaviors like employees speaking up even when it's uncomfortable to do so. Just ask employees of the Department of Veterans Affairs or General Motors for examples of unhealthy behaviors within their cultures as they grapple with cultural transformations.
When entrepreneurs keep their businesses aligned with their values, they can attract talented people and inspire employees to work hard and drive the company forward. When employees see that everyone is held accountable to the same vision, it creates internal cohesion that can make a company hum with productivity.
Companies experiencing massive disruption often approach challenges with event-based change-management techniques in an attempt to mitigate problems. But this avoids the heart of the issue and neglects the bigger picture. Instead of falling into this trap, agitate the status quo and ask, "If we had to reimagine Day 1 of this organization right now, what would we do?"
This question not only addresses consequences but also works to eliminate the causes of the culture deficit. The answer always leads to a necessary adjustment of company culture. By altering and strengthening culture, an organization can thrive.
Related: How to Lead Your Team Through Change
The very suggestion of change can make people within organizations uncomfortable because it is rarely an easy process. Cultural change must begin with reflective thinking, which allows for analysis, evaluation and synthesis of opposing viewpoints. The business leader needs to do the legwork to think through what he or she wants people to experience and how values will be translated into daily decision making. Setting aside the proper amount of time to think this through can makes all the difference and lead to a higher-performing culture.
To reach the desired cultural outcomes, leaders should maintain a meaningful dialogue with their organizations. But leaders often become so focused on cultural change that they fail to set aside the proper time to prepare their organization for the complex and disruptive problems that might occur. Leaders undercommunicate about their vision, values and desired behaviors amid the churn of daily activity.
At Target, its fate might rests in how its leaders discuss, measure and ultimately seek to strengthen its culture. It is difficult to change a company's culture, and the process requires engagement at every level. When the restart button needs to be pushed on company culture, time must be taken to address all challenges that executive staff, board members and employees face. Culture change is slow and begins with deep reflection.
Recently, a proposed merger between advertising giants Omnicom and Publicis was called off because of differences in culture and an inability to agree on how the combined company should be run. The two companies' leaders attempted only to combine their existing cultures rather than daring to imagine and create a new, strong culturen. The merger sought to mesh two separate sets of values resulting in confusion, lost cohesion and distrust.
From a strategy and economic standpoint, the merger might have seemed logical, but did the anyone examine the cultures within each company at the outset to see if one plus one could equal two? An idea that looked legitimate on PowerPoint was derailed by culture.
So does culture eat strategy for breakfast? The answer is yes. And to strengthen a company's culture get ready for a time of deep, reflective thinking.