What does culture have to do with the latest challenges at Bayer and Monsanto?
Since culture goes hand in hand with strategy, quite a lot.
But this fact — that strategy and culture are interrelated — has gotten lost in the current zeitgeist where culture is viewed as the last piece an organization puts in place, something you can just create or layer on. An afterthought of sorts to innovation, product development, sales, marketing, teamwork, and strategy.
From the minute an organization comes to be, if not sooner, culture is there. It’s the basis on which founders and leaders express their purpose, their vision, and mission. It shapes the way decisions are made about what to produce and sell, to whom, and how. Workplace habits and standards, behavioral consistency — even rituals and language — all flow from culture, not vice versa.
In other words, culture is a starting point for all of these things and more, beginning above all with an organization’s strategic agenda. Culture defines the who and the why behind strategy.
As companies grow and evolve, they tend to lose sight of the fact that culture and strategy go hand in hand, and forget that culture was initially embedded in everything they did. Culture gets reduced to a statement hanging on a poster in the office kitchen, conference room or front lobby. The connection between culture, strategy, decision-making, and behavior gets lost. The two are no longer in sync. That puts the company’s strategic agenda and intentions at risk.
This might seem disappointing yet harmless. Not so. Because a disconnect between culture and strategy and everything that flows from them can result in exactly the sort of conflicts and miscues we’re seeing with a range of organizations, large and small. Corporate strategy gets muddled and culture gets confused. The organization gets shackled in decision making, risk management and problem-solving. This has been a challenge with Bayer and Monsanto, as well as for GE, P&G, Boeing, a host of big retail companies, and across the healthcare sector.
As explained in my new book Strategic Teams and Development: The FieldBook for People Making Strategy Happen, culture should inform and help determine every decision leaders take and every action taken throughout the organization at every level, across borders, from executive group and staff directives to day-to-day choices and behavior within teams.
How can you make sure culture and strategy continue working hand in hand, and that culture doesn’t devolve into a string of empty buzzwords staring up from a culture deck that teams and individuals glance at without following through on?
The following four questions will help you assess whether and how your organization’s everyday thought and behavior is aligning with its culture — and make sure you’re not heading down the slippery slope of letting actions and decisions drift away from their cultural drivers:
1. Does the decision we are about to make reflect our values and culture around caring for our customers and their needs in a way that treats them as the assets that they are?
2. Will this decision contribute to our profit and sustenance in a way that remains true to our culture and to the purpose, vision and mission it has led us to shape?
3. Does this decision help us maintain our competitive advantage and differentiate us meaningfully in a way that aligns with our culture and values?
4. Is this decision in line with the ethics and values of service and integrity our culture embodies and is this meaningful stewardship for our full range of stakeholders?
To be a good corporate steward you have to have your eyes wide open for the needs of all types of stakeholders: customers, employees, investors, partners, and suppliers.
These questions intersect with one another in multiple places, forming a complex lattice. Decisions that impact competitive advantage or corporate stewardship will have implications for profit and sustenance. All choices will ultimately impact customers and the way your business meets their needs. There may be conflicts between one category and another, too.
Most companies check in on how they’re doing with culture every year or two at most. But given culture’s crucial foundational importance to strategy and all that flows and is expressed from it, much more attention is needed.
These four questions should be asked regularly and rigorously at all levels of operations and decision-making. They should form the basis for decision-making protocols and policies about everything from risk management and safety standards to financial management and personnel matters.
And if the answer to any of them is “no” it’s time to stop and rethink before taking action.
Daniel Wolf is President and Co-founder of Dewar Sloan, a consulting group focused on strategy direction, integration and execution. For more than 25 years Dewar Sloan has served hundreds of corporate, healthcare, technology and nonprofit organizations. Author of Strategic Teams and Development: The FieldBook for People Making Strategy Happen and Prepared and Resolved: The Strategic Agenda for Growth, Performance and Change, Dan has held management and governance roles at Fortune 500 companies, SME ventures and in private equity ventures. He lives in Traverse City, Michigan.