If You Are Choosing Between Culture and Strategy, You're Choosing Wrong.
Holding leadership accountable for the success of their teams requires a hyper-focus on culture, strategy and execution.
You've heard management guru Peter Drucker's maxim, "Culture eats strategy for breakfast" for years. If you think that means culture and strategy are two sides of a coin, and you have to choose one, you're wrong. That's because today, culture and strategy are the same side of the coin.
One of the key axioms of Fourth Industrial Revolution is that values are embedded in technology and its applications. An innovative new robot might liberate people from dangerous, repetitive work or dehumanize the workplace by squeezing endless efficiency out of every human it doesn't replace. A smartphone app might simultaneously make banking more convenient and cyber-theft easier. Klaus Schwab, author of The Fourth Industrial Revolution, argues that "technology should be empowering, not determining," and the future should be "designed by and for humans."
To create is to choose.
Likewise, entrepreneurs embed values into the business opportunities and models they call strategy. Culture is what you spend your day doing, how you make decisions, who you surround yourself with, who has a seat at the table, who you respect and how you show respect. It is the operating system of your company, and its building blocks are values.
If your strategy is innovation, you'd better have a culture of innovation. Is efficiency your strategy? Then limiting costs and streamlining process must be part of your culture. If your human capital strategy is to become more diverse and inclusive, you must be prepared for hard conversations with managers about unconscious bias. Whether obvious or subtle, values bind culture to strategy.
If culture and strategy are the same side of the coin, what's the other side?
Execution is the visible application of culture to strategy; how strategic ideas, shaped by cultural values, result in products and services. While there are dozens of techniques to get you from where you are to where you want to be (agile development being the latest), execution's challenge is to avoid getting caught up in process. Great execution that isn't reinforcing cultural values and strategic ideas is only an efficient way to get to the wrong place.
Execution is built on relationships
I've worked alongside incredibly successful serial entrepreneurs inside and outside corporate settings, and what they all found very quickly is that they needed to focus on culture from day one as a central part of their execution strategy. Many of them were women who, through temperament or conditioning, brought relationships into their calculus for how things get done. They understand that leaders are accountable for the success of their teams, and so they build relationships in which their people could come to them fearlessly, bringing good news or bad, and those people know that their relationship with the boss is one of connection and common cause.
The lesson from these women is that they design relationships to be trusting, consistent and expressive of shared values. Because they're accountable, they set high standards for themselves and expect others to meet them.
Lest you think this is about everyone feeling comfortable, it's actually about everyone showing up as their full selves, including when they have to do difficult things like cancel a project or lay people off. They show up as their full selves in good times, celebrating wins and elevating winners. In fact, the leaders I know and work with regularly take actions aligned with the culture and values of their companies, something that has bore out even more dynamically amid the pandemic.
Culture vs. the checkbox
Hospitals are a great place to observe whether a culture of relationship works, because everyone's been trained in exacting life-and-death procedures. They're highly emotional environments, and the stakes of success couldn't be higher. And the great hospitals have cultures that encourage innovative behavior alongside exacting standards of care.
One of my company's customers is a hospital that exemplifies how cultural construct can be expressed in the execution side of the coin. Say, for example, an intensive care nurse at their facility has to check patients' vitals many times in a night, recording the data. Checkboxes are, after all, critical healthcare tools. The problem: Just turning on the room lights can wake up a patient who needs rest. So, nurses there invented ways to check vitals without turning on the lights or waking the patients. That's innovation so human and obvious you wonder why it doesn't happen more. The answer is it only happens when the cultural construct for executing your job is: Find a way to satisfy both the checkbox and the patient's comfort. It's a culture based on human connection to patients.
Leave nothing at the door
Over the last year, we've seen big disagreements between CEOs and some employees about whether social or political concerns should be brought to the workplace. I believe entrepreneurs should be constantly thinking about how their culture encourages employees to use their full selves. You can have a culture that says: Leave nothing at the door when you come in. A culture of personal authenticity keeps people performing at a high level, because it creates a culture of widespread authenticity and accountability, which again means embedding shared values into the day-to-day work. Innovation requires an open and curious and mindset, and so does inclusion.
Designing culture demands more than choosing a mission or vision or values – it's designing the relationships among everyone that are the only way stuff gets done in today's interdependent team environment. Take a lesson from those entrepreneurs who know that culture and strategy are inseparable: design them together, and make sure values-based execution enables them both.
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