Most business owners would have heard the famous Peter Drucker quote that culture eats strategy for breakfast. But what did he mean by that? He certainly didn’t mean that strategy wasn’t important. Drucker knew that a powerful culture is critical in executing business strategy and that a company’s culture normally frustrates any attempt to create or enforce a strategy that isn’t compatible with that culture.
So is a high-performing business possible without a high-performing culture? Well, theoretically, yes, but it’s certainly not sustainable in the long term.
And while culture is no substitute for poor strategy, the difference between average performance and sustained high performance is generally a winning culture. A winning culture enhances execution.
There are three components required to create a winning culture in any business.
First up is a clearly articulated cultural vision. That’s the purpose, the mission, the vision, the values of your business. Are they defined? Do you have a defined mission and vision statement? Do you have defined core company values? Preferably not the cookie cutter, me too sort of thing – you know, honesty, integrity, loyalty and so on – but core values that are actually meaningful and describe the type of behaviour and attitudes you want in your business. If you really believe in your purpose, mission, vision, and values – you will take the time and effort to communicate them and embed them into the DNA of your business.
The test of all this is whether your team knows the cultural vision, without having to look it up. If prompted, does a team member know the mission statement, and can they recite the core values? Clearly and consistently articulating your cultural vision will mean that it sticks with your team.
If there’s one thing you can be sure of, it’s that culture starts from the top. And this is true for both good and bad culture. In the absence of a great, high-performing culture, there won’t be a vacuum; there’ll be a poor culture. It’s the responsibility of leaders and the leadership team, to both set and drive the culture, you can’t rely on a democracy. And culture will be inspired by leadership, rather than management.
So leaders need to need to walk the walk, not just talk the talk. If the business leadership is demonstrating commitment through their actions, it will have a flow on effect through the whole team.
The third requirement is to have systems in place to reinforce the culture, to continually drive and embed the culture in the business. This includes organisational structure, it includes recruiting and talent management, it includes reward and recognition schemes and team feedback programs.
So your organisational and management structure needs to be aligned with the culture you’re trying to build, does your structure give your team the room to practice your core values? What about hiring and firing, is this driven by cultural fit or just on skills and results? Do you recognise and reward team members based on their commitment to the business culture? Do your company values feature in performance reviews?
Creating a winning culture requires consistency, so you need systems in place that will enforce that consistency throughout your business operations.
I’m sure most business owners can see the benefits of cultivating a winning culture, the challenge is what are you doing about it? The stats show that less than 20% of business owners spend any meaningful amount of time to specifically manage and improve their business culture.
So if you’re in the 80% majority, take some time to think about how you might leverage these 3 areas – articulation of your cultural vision, demonstration of leadership and reinforcing your culture through the use of systems.
Because if you can create that winning culture in your business, it will be a competitive advantage that is hard to replicate.