Culture Eats Strategy – Making a Meal of Digital Transformation

With the ubiquity, pervasiveness and media hype around technology’s impact on our lives, it would be easy to suggest that we’re being swept forward in blissful euphoria toward a bright and shiny tech-enabled future.

That would be overly simplistic and a little naïve.

Specters like automation, privacy, government surveillance, black hat hacking suggest, amongst this sea change, there are other forces we need to consider too.

Then there’s the simple truth that many (most?) human beings just don’t like change.

In fact, getting people to change typically meets resistance. Even violence.

We jokingly refer to people as Luddites when they seem slow to adopt new technology. Forgetting that Luddites were a real group of individuals in 19th century England who burnt down textile factories fearing the rapid advance of new technologies. Technologies intended to streamline processes seen as inefficient and slow by Industrialists, but technologies that threatened their very way of life.

That probably explains why most Change Management pundits characterize what they do as “the application of a structured process and set of tools for leading the people side of change to achieve a desired outcome”. I wonder how much simpler John Kay and James Hargreaves lives would’ve been with the application of PROSCI’s ADKAR system.

Business today is in the midst of a similarly foundational transformation. This one driven by that universal term “digital”.

And, not surprisingly, the same lines are being drawn.

New unfamiliar processes versus old familiar practices.

 Technology versus humanity.

 Flexibility and responsiveness versus Intractable and plodding.

 Strategy versus Culture.

The latter is so frequently quoted it has become the most over-used and over-wrought meme on LinkedIn. A day seldom passes when Peter Drucker and the immortal “Culture Eats Strategy for Breakfast” line doesn’t appear in my newsfeed. (Apologies for adding another instance)

For those who scratch beneath Drucker’s phrase – not merely like, share and comment “Amen” – the insight is alarmingly simple and profound.

Strategy is a fast moving, adaptive requirement for any business. Particularly those in a digital age, meeting the heightened demands of digitally-empowered customers, and looking to eke out the benefits of speed and efficiency that digital offers.

Culture, in contrast, is an entity grown over time. Shaped and nurtured by the previous successes and failures of an organization. An internal short-hand that employees characterize, often flippantly, as “just the way we do things around here”. Something that, unlike Strategy, doesn’t dramatically change when a 90-day analyst’s call goes pear shaped.

But, as noted culture academic Edgar Schein has written about extensively, Culture is way way more critical than an internal short-hand. Culture articulates what an organization considers important – its Values – and how it will act in accordance with those values – its Behaviours.

And, ultimately, it’s those behaviours that will be the arbiter of whether your digital transformation is a genuine success. And whether your organization’s transformation has been substantive or just superficial.

Consider the Values of collaboration, inclusion, accountability, customer-centric and transparency.

I’d venture it wouldn’t be unusual, or even unique, to have those exact Values at your organization. And for you and your colleagues to have a pretty decent handle on the associated and acceptable behaviours linked to those.

Now consider an organization poised to implement the significant potential of a digital transformation.

Or consider the new behaviours employees of a digitally-transformed organization face.

Collaboration that now enables loyal customers, and even random members of Joe Public, to directly participate in new product development and, furthermore, to have those same customers expect to be directly remunerated for that product’s success. Who determines which idea is best? Can you push and cajole people who aren’t on your payroll?

Inclusion that now includes a legion of freelance contractors with on-demand remote access to your proprietary systems and IP on a project-by-project basis. Freelancers who’re quite likely to be working with your competition when they aren’t working for you. Who do you trust? How far do you trust them?

Accountability that now utilizes mountains of “big data”, historical analysis and increasingly projective algorithms to codify and score each and every decision made within an organization. No more hiding. No more fudging. No more decisions made on “gut”.

Customer-centric systems that now push the decision making ability down to the very point of interaction between customer and your organization. No longer vetted by the senior and seasoned executive making the call. Now it’s to the junior bank teller. It’s the harried customer representative at the airport departure gate. Or the call-center operator at the end of her shift. Will they make the “right” call? Will they balance the needs of each customer with the needs of the organization? Will they go too far – or not far enough – to satisfy those needs?

Transparency that now means droves of employees enthusiastically using open-source social media platforms to comment and opine on the organization’s actions on issues like gay rights, access to water, the environment, sustainability and labour practices. Where are the borders between important discussions and time-wasting social pontification? Just how free do you want speech to be internally? Just how open do you want your organization to be? Read this brilliant real-life example from IBM if you don’t believe this is a real scenario.

Ultimately the digital transformation of your category, your organization, your team, and even your career, is inevitable. The benefits are just too compelling.

The success of that transformation will require more than just brilliant software and services. It will require a sense of humanity for the customers you serve and a deep empathy for the colleagues you lead.

A recognition of the people side of the changes you’re trying to drive.

A need to align Strategy and Culture.

(In recent week’s there’s been a tsunami of opinion on the Culture of a digitally-centric organization – Amazon – and how brutal it supposedly is. And that’s an organization that grew up digital. If you’re looking for a great example, then I always recommend another digitally-centric organization, NetFlix. I’d encourage you to read this brilliant Slideshare document to see how they keep their Culture strong.)

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About the author  ⁄ Hilton Barbour

Hilton Barbour

An insatiable curiosity is my defining characteristic. Which is probably why I got into advertising over 15 years ago. I know it aint a real job in comparison to say, a fireman or a nuclear physicist but hey. Along the way I've developed an opinion on a coupla things.

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