Culture vs. Strategy: which one is more important?
It’s the age-old business question.
Of course, they are both important. But as Peter Drucker said years ago, “Culture eats strategy for breakfast.” He was saying that culture is more important than strategy.
I am not taking anything away from the importance of developing a competitive strategy, but with regard to culture, ask yourself a few questions.
- Are you externally focused on customers?
- Are you internally focused on employees
- Do you have a hierarchal culture, where it is all about rules and regulations and compliance with a pre-determined set of rules; or are you relying upon people to be entrepreneurial – or entrepreneurial inside of the organization?
There is no right or wrong answer in terms of culture; but you have to pick a culture that serves your purposes, and use it.
Now, why do we say culture is more important than strategy?
Strategy is what it is you’re doing. Culture is how you’re doing it. (Click to tweet.)
I’ve likened it to the relative importance of water vs. air to our bodies. We all know we need hydration. If you don’t have water for a few days, you’re going to die of dehydration. But what if you couldn’t breathe? And you didn’t have anything to drink? Well, you wouldn’t care very much about the lack of water because, in just a few minutes without air, you are going to be in serious trouble.
The same is true for organizations. You can have the greatest strategy in the world, but without a culture that supports the execution of that strategy, you will not be effective in the marketplace.