How Corporate Culture Contributes to Corporate Success

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I recently read an article in IndustryWeek titled, “You Have the Wrong Idea about Corporate Culture.” The author asserts that culture is crucial to corporate success, hard to define, and frequently (and erroneously) amalgamated with employee morale. Although I never encountered that last perspective, I have also never seen anyone discuss corporate culture as a key component of corporate success. I think that it is.Business leaders

The famous management guru, Peter Drucker, is (erroneously) alleged to have said, “Culture eats strategy for breakfast.” Regardless of who actually said it, the idea that corporate culture is important has been around for a long time. If culture is as important as Mr. Drucker and others think, there are three questions that we, as leaders, need to answer:

  • Why is culture important?
  • What is culture? (If I can’t define it, then I can’t manage/improve/sustain it.)
  • How does culture contribute to corporate success?

I’ve previously posted on Changing Culture so I won’t repeat it here. Rather, I want to focus on the last bullet above – “How does culture contribute to corporate success?” The author of the article that inspired this post uses examples of good and bad culture in two companies: Acme (good culture) has a “Fix the Problem” culture, and Zebulon (poor culture) has a “Fix the Blame” culture. The author states that Acme has the advantage over Zebulon with respect to its ability to solve problems, make decisions, develop plans, generate and implement new ideas, respond quickly to environmental changes, and to quickly and effectively seize new opportunities. Absent any data, I suspect that we would all agree that a company with a culture that is focused on fixing problems is one in which employees (at every level) feel safer and more empowered and are more likely to perform well than employees in a company where everyone is focused on avoiding responsibility. While those are extremes, there is a continuum of cultures between them with some companies being more “fix the problem” oriented and some more “fix the blame” oriented.

These tendencies are a reflection of company leadership. Going back to my post on Changing Culture, I closed that post with a quote from an instructor at Harvard Business School, “Culture change is both the hardest and easiest thing to do. All you have to do is be the change and expect the change.” The “you” in that quote is the leader. So what is that change “you” have to make? My previous post goes into some detail, but in a nutshell, it is changing behaviors:

  • The corporate “rites” – how things are done?
  • The corporate “symbols” – the things that we use to represent the company or its work.
  • The “heroes” – recognizing those people who successfully use the “rites” and “symbols” to make things better and make better things.
  • Corporate “consistency” – follow the processes. It’s easier to follow a proven road (and to improve it) than to blaze an entirely new path through the wilderness.
  • Corporate “collaboration” – while Horatius, alone and unafraid, successfully defended the bridge against the invading barbarians, it would have been a lot easier if others had honored him (the hero) by joining in the defense (adopting the rites). It would probably have been less fatal for good ole Horatius too.

Once again, it’s about leadership and doing things that are frequently outside our comfort zones.

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