Good Strategy Starts With Good Culture

Peter Drucker once said: “Culture eats strategy for breakfast.”

Author of The 5 Dysfunctions of a Team, Patrick Lencioni says that there are ‘Smart’ organizations and ‘Healthy’ organizations; however, great organizations are both smart and healthy.

Richard Branson has said, “Clients do not come first. Employees come first. If you take care of your employees, they will take care of the clients.”

More and more, it is becoming apparent (even to the dinosaur managers out there) that the best way to develop and execute on winning strategies is to build a high performing culture based on a great team. And by great team, I mean a culture that is based on a common purpose, value alignment and great attitudes.

Top organizational cultures like Facebook, Google, SouthWest Airlines, WestJet Airlines, Nike, Apple, Disney, Citrix, Adobe, REI… are also top performers in terms of employee engagement, customer satisfaction, and ROI for shareholders. Coincidence?

Organizations that continue to believe that employees are just ‘numbers’ (Yes, there are still vestiges of fossilized managers out there that refer to the most important “Assets” in their business as FTE’s or Full-time Equivalents) interestingly enough, are also the companies that struggle for growth and profitability quarter to quarter. These managers are constantly talking about cutting costs.

As a Strategist, I have seen companies with well thought out, amazing strategies… but mediocre, apathetic or schizophrenic cultures. They have even followed the strategic design philosophies detailed in the book, “Blue Ocean Strategy” by W. Chan Kim and Renée Mauborgne. The Results? Mediocrity, apathy and schizophrenic results, high customer churn and high employee turnover. Coincidence? Nope.

When asked to come in and give my recommendations for what is wrong with the ‘strategies’ in organizations like this, I often will have to sit down with the leaders and tell them to get their head out of the sand (sometimes I have to tell them to get their head out of certain body parts) and start focusing on building a great culture first. Make the organization healthy in terms of people first.

My BIG SEVEN for organizations that want to join the elite world of high performing businesses are…

1. Build a culture of trust and engagement that starts with hiring team members that are aligned with your purpose and values. Great attitudes trump great skills every time. There is no room for jerks with a brilliant resume. Current team members that are a cancer to a great culture need to go – Fast! Train everyone constantly.
2. Clear and compelling vision. Everyone needs to know what good looks like.
3. Pick a single distinctive excellence that everything they do is focused around. Apple focuses on Innovation in everything they do.
4. Strategies (three of them – no more!) that are so simple you can explain them to a 6-year old.
5. If you have a plan with clear measures of success, why hide the score? Make it super visible to everyone all the time.
6. Regular reviews so everyone knows how they are contributing.
7. Even more regular communications. You cannot talk about it enough.

If your ego won’t allow you to build a great culture because you think you will lose power or costs will run out of control, then you are part of the problem. You might actually BE the problem.

Robert Murray is a Business Strategy Consultant, partner at Incrementa Consulting Inc., #1 Best Selling Author, and International Keynote Speaker. For further advice, insight and inspiration on how to unlock your inner leader, follow Robert on Twitter, LinkedIn and Facebook.