Wednesday, 24 February 2010

Strategic Culture - setting the tone

This think-piece might help anyone who is considering the topic of 'culture' within a CMI qualification at L7 or L8 or who is reflecting on their organisation's strategic position and future direction.

Strategic Culture - a fancy title, a potentially obscure concept and the title of one of the units in the CMI Level 8 (PhD level) professional qualification in Strategic Direction.

None of which is the reason that it matters.

Strategic culture is much more significant than that. It is about the spirit in which managers manage, the underlying assumptions on which decisions and designs are based and the unspoken 'norms' against which behaviour is judged.

To illustrate this basic 'normative reference' concept - a while ago I was attending an international conference. An overseas delegate with whom I had been grouped in morning syndicates asked if I wanted her to bring me some lunch from the buffet - I said yes and offered in return to fetch coffee. On my return I found a single plate containing many finger food savoury items, both hot and cold, along with some dessert and cream. I was nonplussed and felt quite uncomfortable while eating my lunch - worried that my reaction had offended, worried that others might look at my plate and think I was 'wierd', worried that I wasn't going to be able eat the dessert that now had sweet chilli sauce on it.... yet this was really only a very slight behavioural variation on what I would consider the 'norm'.... 1 plate, not 2

We had just experienced a very real and basic difference in what we consider 'normal' - a 'clash' between our cultural perspectives.

When 2 organisations merge, such cultural dissonance will crop-up every day, as the two 'cultures' bash into each other. For example: one such merger in which I had a minor part brought together an organisation with a very flexible leadership style and low-key attitude to hierarchy with another, much more formal and traditional culture. This variation in basic assumptions about 'how we do things around here' was evident in almost every function and process. In management meetings - where half arrived in suits and on time having prepared for the agenda items, while the others viewed the start-time and agenda as a rough-guide and expected to have ad hoc debate about anything that arose from the meeting. As a neutral attendee, it was like crossing the border from one country to another and then back again every few minutes. Their decision to have a rotating chair (not literally) produced a wonderfully random lurch from one prevailing style to the other. Decisions were very hard to reach and generally satisfied neither party. The term 'management team' was no more than a courtesy title... this was certainly not yet a team.

Perhaps then, the key issue here is to establish a strategic culture as a deliberate act and in service of a strategic intent. To recognise that such a culture affects every aspect of the organisation, its people and products or services.

While there are many schools of thought on the subject (see Handy, Lewin, Pascale, French & Raven, Mintzberg, Moss Kanter, Peters, Mullins and many others), personally I have come to the view that organisational culture is most typically reflective of the style, attitudes, values and behaviours of the top team.

I coined the phrase 'Organisational DNA' many years ago to illustrate what I mean. Just as with DNA testing, if you analyse any major process or event in an organisation, you can deduce much about the whole 'organism'. Some of my colleagues and I used to play a game called 'receptionology', whereby we would try to describe the culture of an organisation we were visiting within 1 minute of arriving in their reception area; by looking at the things on the walls (Certificates, awards, artwork, PR etc), the furniture and decor, the receptionist/desk/greeting and so on. Generally the look, feel, attitudes and approaches evident here will be reflected commensurately in leadership style and management behaviour. We generally got few surprises when we met the top team!

A simpler example and one closer to home for many; as a teacher or lecturer, I would often be fascinated on parent's evenings by how easy it was to 'match' parents to their offspring before being introduced. Generally, with any student who had behavioural or attitudinal issues it was easy to identify the origin in the 'strategic culture' of their family and homelife.

All that is designed simply to prove the concept: Culture reflects the top team, culture sets behavioural and attitudinal norms, culture affects the design: of the organisation, of management, of process, of product & service, of job roles and so it goes on.

Yet the topic and concept of 'culture' is seen by many to be an 'airy-fairy' or woolly and amorphous concept and thus 'nothing to do with me'.

I suggest it is anything but ephemeral and that it is very much to do with any leader. You set the tone. It affects everything and everyone. It dictates performance, sets expectations and drives every aspect of the organisation. I might even be provocative and say that, far from 'not mattering', as the attitude of some leaders suggests, NOTHING ELSE MATTERS SO MUCH.

Consider this: As a leader, you tell people what to care about and what matters. Your reaction to events or processes, the things you stress or focus on, the things you do or say first, the things you choose not to do - all of this sends overt and subliminal messages to your people, telling them what really matters and where their priorities should lie.

If you wish to encourage creativity, empowerment and innovation (and if you don't, you probably should) - then it is crucial that you reward the taking of risks, encourage people to try things, allow people discretion and freedom to act and that, as Tom Peters puts it, "you reward heroic failures".

If you are naturally cautious or conservative, chances are that your people will automatically avoid any possibility of risk or failure - with mediocrity and stagnation the most likely result. By the same token, if you are brave to the point of recklenssness and love taking chances - then you can confidently predict rather a lot of 'heroic failures' will be coming your way! Clearly, context is everything. Many environments cannot afford such failures. I myself would be unhappy to take a domestic flight if I felt that the culture of Air Traffic Control was one of 'bravery and recklessness'. However, and this is the crux, if you want significant performance improvement, a step-change in organisational success or even an effective process for the identification and eradication of problems - then people must feel empowered to attempt and champion change and to make local decisions.

Your 'strategic culture' must support your strategic intent.

The Unit at L8 has this (among other things) to say about Strategic Culture:

(A leader must) ...identify and critically evaluate the conceptual grounds on which current perceptions of inter-organisational policy and strategy are based

and must go then on to shape the culture accordingly to...

...develop researched logical, powerful and coherent arguments for discussion with stakeholders and influencers which challenge the status quo in terms of thinking and structures

This requires the ability to stand back from the organisation and your own role to observe it dispassionately and objectively:

How does the top-team behave?

What is the prevailing leadership style of the top team and the overall leader?

What cultural 'Norms' have you established?

To what extent do they support or inhibit your strategic intentions?

and most of all....

What needs to change if your stategic goals are to be achieved?

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