Creating a Strategy-Supportive-Culture

Importance of a Strategy-Culture Fit

Beliefs, Goals and Practices underpinning a strategy’s success may or may not be compatible with company’s cultureWhen they are not, culture may impede or even

defeat the implementation

Strong culturesPromote good performance when fit exists

andHurt performance when little fit exists

Creating a Strategy-Supportive-Culture Fit

Changing culture to fit a new Strategy is a tough executive challengeEspecially when prevailing culture is entrenched

and unhealthy

Linkage

There has to be strong linkage between Strategic Management and Organisational Culture….

Weak linkage can jeopardize performance and success

Deal and kennedy Emphasized that making strategic changes in an organisation always

threatens a culture :

“People form strong attachments with heroes, legends, and rituals of daily life, the hoopla of extravaganza and ceremonies, and all the symbols of workplace. Change strips relationships and leaves employees confused, insecure, and often angry. Unless something can be done to provide support for transitions from old to new, the force of a culture can neutralize and emasculate strategy changes.”

New Strategies are market driven and dictated by competitive forces

Hence….Changing a firm’s culture to fit a new strategy is more effective than changing an strategy to fit an existing culture

Senior Executive must personally lead efforts to create a strategy-supportive culture

Mindset

Strategists should strive to preserve, emphasize, and build upon aspects of existing culture that support new strategies.

Step by Step Method

Step 1Diagnose which facets of present culture are strategy-supportive and

which are notStep 2

Talk Openly and candidly about aspects of culture needing change

Step 3Follow talk with swift,visible action-

Substantive or Symbolic

Substantive Culture Changing Actions

• Benchmarking and best practices• Stake out new business positions• Increase commitments to employee

training• Re-allocate budget-Downsizing &

Upsizing

Bring in new blood replacing

old traditional managers

Make Major Re-organisational Moves

Lewin’s Three Step Model

Unfreezing

Kotter’s Eight Step Plan

1.Establish a sense of urgency by creating a compelling reason why new strategies are needed

2. Form a coalition with enough power to lead the change3. Create a new vision to direct the change and strategies for

achieving the vision4. Communicate the vision throughout the organisation.5. Empower others to act on the vision by removing barriers to

change.6. Plan for, create, and reward short term “wins” that move the

organisation towards new vision7. Consolidate improvements, reassess changes, and make

necessary adjustments in the new programs.8. Reinforce the changes by demonstrating the relationship

between new behaviours and organisational success.

Set world class performance targets

Change reward structure

New strategies must seem to be more attractive and rewarding than previous strategies .